Published & updated 10 August 2020:
Augusta Capital Ltd has sold down its $35.5 million of units in the Augusta Property Fund in 3 weeks.
Oversubscriptions of 3 million units took the total to $38.5 million and Augusta Capital will take up its usual 10% stake of that higher total.
Marketing agent Bayleys had held only 4 of its scheduled 17 presentations when subscriptions were filled.
The fund was reduced from the originally intended 2 properties on opening, to one, the Anglesea Medical Centre in Hamilton, bought by the fund for $55 million.
The Albany Lifestyle Centre large format retail hub in Auckland was also to have been in the initial portfolio, but in the uncertainty of the Covid-19 lockdown Augusta didn’t proceed with that $89 million purchase.
Bayleys syndicated investments manager Samara Phillips said the reinstatement of tax deductions for depreciation of commercial & industrial buildings as part of the Government’s recent stimulus package would make a significant difference to investors’ after-tax returns.
“With the Augusta Property Fund’s PIE (portfolio investment entity) structure, the forecast after-tax return for those on the maximum tax rate of 28% is 5.84%/year for the first financial period ending 31 March 2021 and 5.72% for the following financial year.”
22 July 2020: Corrected: Augusta relaunches property fund
28 March 2020: Augusta pulls Albany purchase, but property fund may be revived
27 March 2020: Augusta pulls property fund IPO