Archive | Securities – overseas

Greenland & Golden Horse start 1400-apartment job on old Goodman industrial site

Chinese state-owned developer Greenland Group & Golden Horse Group of Hong Kong turned the first sod on Thursday for a 6.9ha 1400-apartment joint-venture project at Erskineville in Sydney’s inner-west, on a former industrial site which Goodman Group sold to Golden Horse in 2014.

Construction partner for stage 1 of the Park Sydney development is local family-owned builder Richard Crookes Constructions Pty Ltd, which has worked on several Greenland projects.

Image above: Park Sydney masterplan, highlighting amenities.

The masterplanned residential community will be developed in 5 stages and will ultimately feature 9 development blocks ranging in height from 2-8 storeys.

Park Sydney, 4km from Sydney’s cbd, will have a 7446m² public park, a supermarket & specialty shops, a fresh food precinct, eat street, medical centre & childcare centre.

Greenland Australia managing director Sherwood Luo said: “Together with Golden Horse Australia, we’ve been planning Park Sydney since 2016, so it’s particularly exciting to see major projects of this scale starting to take shape and watching how they transform the local area.

“We are converting this large former industrial precinct into an engaging & inclusive residential community that will ultimately become home to some 3000 residents.”

The value to Goodman of its exit

Golden Horse Group expanded into Australia in 2013 and bought the former industrial site in Erskineville from Goodman Group the next year. For Goodman (owner of NZX-listed Goodman Property Trust’s management company & cornerstone investor in the trust), that deal was among many as the group sold $A1.9 billion of mostly industrial assets in a year, and reinvested the lot to generate higher development returns.

Builder with long list of staff support programmes

On a different tack, the builder on this project has a lot to say about how it treats its staff – an eye-opener at a time the New Zealand construction sector has been grumbling about contract arrangements, and this government (like the last one) is talking about increasing training for & numbers in the construction industry.

Richard Crookes Constructions says on its careers page: “RCC believes the success of every project depends on the ability of their personnel and the synergy of the project teams… RCC’s business is based on maintaining long-term relationships with clients, partners & subcontractors.”

It also lists a number of staff-supporting views that I’m sure would be novelties if espoused in New Zealand:

  • We build a talent pipeline
  • We expect our staff to engage in the business and be part of its success, growth & evolution. In return we invest in their growth & development. We give people autonomy, support & the resources they need to perform at their best
  • We maintain a flat management structure with an open door policy and an honest & collaborative culture
  • Fitness passport gives individuals & families access to multiple facilities (gyms, swimming pools) which allows you to go as often as you like
  • Exercise incentives, health assessments, mindfit programme, access to trainers, $A100 annual rebate & annual flu vaccinations
  • RCC offers corporate rates with BUPA to all employees in an effort to encourage healthy lifestyles
  • Every employee receives one day off every 6 months – employees are encouraged to use the leave for engaging in health & wellbeing activities, spending time with family & friends or to relax
  • Each employee has the ability to purchase an additional 2 weeks of annual leave/year
  • Maternity & paternity leave is offered when members of the RCC family start or expand their own families
  • We would like your salary to work as hard as possible; for this reason, we offer salary packaging options such as novated leases (a lease arrangement, usually for a vehicle, where the employer takes on the obligations of the lessee to the financier, which ceases if the employee leaves the job)
  • Our staff can access a range of discounts from partnering retailers
  • RCC has a financial advisor in-house who is available to meet with staff one on one
  • We believe in & support females at RCC; one of the programme offerings is our women’s leadership lunch & learns
  • We offer an array of learning & development for our employees through coaching sessions, formal mentoring programmes, external training, role-specific technical training & leadership development programmes across all levels.

Park Sydney
Greenland Australia
Golden Horse Australia
Richard Crookes Constructions

Earlier story:
17 August 2015: Urban renewal lifts Goodman Group

Attribution: Joint venture release, Greenland, Golden Horse & Richard Crookes websites.

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Goodman Group sets up Brazilian logistics investment partnership

ASX-listed Goodman Group, which manages the Goodman Property Trust in New Zealand, has established a $US700 million ($NZ1 billion) Brazilian logistics partnership to invest in Sao Paulo & Rio de Janeiro.

One of those projects is Goodman’s proposed 27,000m² flagship development 20km from São Paulo, provisionally named ABCD1 (pictured), near 2 highways & the Mario Covas ring road, providing easy access to Santos Port, the largest port in Latin America.

Goodman Brazil chief executive Cesar Nasser said on Wednesday the Goodman Brazil Logistics Partnership would invest in prime logistics & industrial assets in the 2 gateway cities, starting with a $US250 million investment in existing assets & work in progress.

He said the partnership would allow Goodman to invest alongside its global capital partners, the Dutch pension funds manager APG Group NV, the Canada Pension Plan Investment Board, First State Super of Australia and the Singaporean sovereign wealth fund GIC Pte Ltd, who shared the same investment horizon & confidence in the Brazilian market.

“The partnership has been established with about $US270 million (1 billion real, $NZ390 million) of existing assets & work in progress that can be developed to deliver over 1 million m² of high quality logistics space. With the Brazilian market experiencing under-supply of modern, high quality space, we have an opportunity to expand our global platform in Brazil for the benefit of our customers.”

Goodman Group entered the Brazilian property market in 2012, owning, developing & managing modern high quality logistics & industrial properties.

The group has built up a $US28.3 billion global operating platform of 375 properties in 16 countries. It has 17.3 million m² under management.

APG Group
Canada Pension Plan Investment Board (CPPIB)
First State Super

Attribution: Company release.

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2 new Blackstone funds have $US9.4 billion to invest in Asia

US fund manager Blackstone Group LP closed investment in 2 Asian funds this week – its first Asian private equity fund, Blackstone Capital Partners Asia, on Tuesday, and its second Asian opportunistic real estate fund, Blackstone Real Estate Partners Asia II, on Wednesday.

At $US2.3 billion, the private equity fund is comparatively small – the real estate fund has $US7.1 billion of capital commitments. But the whole of Blackstone’s private equity business has $US111 billion of assets under management.

Coupled with associated commitments from its global buyout fund, Blackstone’s capital partners fund has a minimum of $US3.8 billion of equity to invest in Asia.

Blackstone’s global head of private equity, Joe Baratta, said: “The region continues to experience strong growth compared to other major markets, presenting compelling investment opportunities across sectors.”

Blackstone Real Estate global co-head Ken Caplan said the real estate fund was the largest it had ever dedicated to real estate investing in Asia. He said it gave Blackstone flexibility to pursue a range of opportunities and commit capital with speed & scale.

Blackstone’s real estate business has about $US120 billion in investor capital under management. Its portfolio includes hotel, office, retail, industrial & residential properties in the US, Europe, Asia & Latin America. It also operates a real estate finance platform, including management of the publicly traded Blackstone Mortgage Trust.

Link: Blackstone Group

Earlier stories:
18 May 2018: Goodman & Singapore fund sell VXV portfolio to Blackstone
2 February 2018: Blackstone’s Arena Living buys Mt Eden Gardens
17 February 2016: Blackstone buys Lendlease’s NZ retirement villages

Attribution: Company releases.

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Unibail-Rodamco completes Westfield deal

Unibail-Rodamco SE completed the acquisition of Westfield Corp Ltd at the end of last week to create an owner of 102 shopping centres in 13 countries – including some offices & convention spaces, a €62 billion ($NZ104 billion) portfolio.

It doesn’t include the former Westfield mall assets in Australia & New Zealand, moved to the Scentre Group in 2014.

The enlarged mall-owning entity based in Amsterdam & Paris, Unibail-Rodamco-Westfield, describes itself as “the premier global developer & operator of flagship shopping destinations”.

88% of its portfolio is in retail, 7% in offices and 6% in convention & exhibition venues. 56 of its malls are flagships in Europe & the US.


Earlier stories:

25 May 2018: One last step for UnibailRodamco takeover of Westfield
13 December 2017: Unibail-Rodamco strikes deal to buy Westfield

Attribution: Company release.

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One last step for UnibailRodamco takeover of Westfield

Westfield Corp Ltd securityholders voted overwhelmingly on Thursday to approve the mall owner’s acquisition by UnibailRodamco SE and the demerger of OneMarket Ltd.

The vote to proceed won support from 97.55% of shares, 93.85% of securityholders. UnibailRodamco shareholders voted 95% in favour on 17 May.

The whole process is due to culminate in implementation of the takeover on Thursday 7 June, but the deal remains subject to final court approval of the acquisition scheme of arrangement. That’s due back in the New South Wales Supreme Court next Tuesday, and the entire deal is scheduled to go through in Australia on Wednesday.

Unibail-Rodamco will acquire all Westfield’s securities for $US2.67 cash plus 0.01844 new Unibail-Rodamco stapled shares per Westfield security, which by default are to be issued in the form of Unibail-Rodamco-Westfield CDIs (Chess depositary interests), listed on the Australian Securities Exchange, and will be fully exchangeable with the new group’s stapled securities listed in Amsterdam & Paris.

Westfield will simultaneously demerge retail technology offshoot OneMarket Ltd on the basis of one OneMarket share for every 20 Westfield securities held.

Trading in the new CDIs will open on the ASX next Thursday, and trading in OneMarket shares will open on a deferred settlement basis on Thursday.

Westfield Corp has its headquarters in Sydney but all its 35 malls, worth $A35 billion, are in the US & UK. When Westfield Group split in 2014, the Australia-New Zealand part of it went into SCentre Group Ltd. That’s outside this deal.

Unibail-Rodamco & a newly created Dutch real estate investment trust (reit) holding Westfield’s US operations will become stapled entities.

Adding Westfield’s $A35 billion portfolio to UnibailRomdamco’s €43 billion gives a portfolio value of $NZ110 billion. UnibailRomdamco has 67 malls, plus 13 office buildings and 11 convention & exhibition centres totalling 4.6 million m² of gross lettable area.

Image above: Westfield’s 175,000m² Stratford City mall, which is also to have 1200 apartments. In the background is London Stadium, built for the 2012 Olympics and now home to West Ham United football club.


Earlier story:
13 December 2017: Unibail-Rodamco strikes deal to buy Westfield

Attribution: Company releases.

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Goodman & Singapore fund sell VXV portfolio to Blackstone

The joint venture between the Goodman Property Trust & Singapore sovereign wealth fund GIC has sold its VXV office portfolio along Fanshawe St in the Auckland cbd to funds managed by US asset manager Blackstone Group LP for $635 million.

The gross sale price of $635 million – $165 million above the estimated value after 2 buildings were added to the portfolio last June – reflects a passing yield of 6.6%.

GIC entered the joint venture, Wynyard Precinct Holdings Ltd, in 2014, making its first investment in New Zealand property. Goodman held 51% and GIC 49% of the venture.

The VXV commercial precinct is on the Victoria Park end of the Wynyard Quarter, which has turned a former industrial & port district into a smart & upmarket office, café & residential precinct. The VXV portfolio comprises 7 lowrise office buildings containing about 88,000m² of space.

John Dakin, chief executive of the Goodman trust’s manager, Goodman (NZ) Ltd, said today: “This is a defining transaction for our business as it completes a repositioning programme that has established the Goodman Property Trust as the country’s leading provider of high quality industrial space. Following this & other contracted sales, Goodman’s $2.2 billion portfolio will be almost 100% invested in the Auckland industrial market.

“We have made tremendous progress with our development programme over the last 5 years, with more than $670 million of new projects improving an already high quality portfolio. The $1.2 billion of asset sales funding this development activity have also deleveraged the balance sheet. With an expected loan:value ratio of below 20% following this sale, we have substantial capacity for future development & investment opportunities.”

The transaction, which remains subject to Overseas Investment Office & freehold landowner approval, is expected to settle late in the 2019 financial year (in the first quarter of next calendar year) and will add about 2.5c to the trust’s pro forma net asset backing. The settlement timing means the sale is not expected to have a material impact on earnings or distributions for the 2019 financial year.

Earlier stories:
2 February 2018: Blackstone’s Arena Living buys Mt Eden Gardens
27 June 2017: Goodman-GIC joint venture settles Bayleys House purchase
14 May 2017: Goodman-GIC joint venture adds Bayleys House to portfolio
>17 February 2016: Blackstone buys Lendlease’s NZ retirement villages

27 March 2015: Fletcher & Goodman sign up for new Wynyard Quarter building
7 November 2014: Goodman Group buys another Wynyard development block
7 November 2014: GIC buys into Goodman waterfront partnership

Attribution: Company release.

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Singapore reit manager ARA buys 19.5% Cromwell stake

Singapore-based real estate fund manager ARA Asset Management Ltd has agreed to buy the bulk of a 23% stake in ASX-listed Cromwell Property Group from a Johannesburg investor, Redefine Properties Ltd.

The transaction is subject to approval of the Australian Foreign Investment Review Board.

Cromwell manages $A11.2 billion of assets and operates in Australia, New Zealand & 10 European countries. In New Zealand, Cromwell owns 50% of syndicator & funds manager Oyster Property Group Ltd.

ARA has agreed to buy 19.5% of Cromwell for $A405.87 million at $A1.05/share, leaving Redefine with 3.06% of the Australian company.

Redefine chief executive Andrew Konig said: “For us, it is about optimising capital efficiency while still benefiting from future distributions & the redevelopment of certain quality assets in Australia.”

ARA manages $S40 billion of assets and recently embarked n a global expansion programme, establishing platforms in Europe & Japan.

Chief executive John Lim said: “Asia Pacific remains a focus for ARA even as the company expands its footprint globally. We entered Australia in 2015 and have been steadily increasing our investments in the market over the last 3 years. Australia continues to offer strong investment & capital-raising opportunities to support the growth of our funds platforms.

“We are attracted to the strength & depth of Cromwell’s platforms, track record of pursuing value-enhancing real estate strategies & strong corporate governance.”

ARA is one of the largest real estate investment trust managers in Asia ex-Japan, managing 5 listed reits – Fortune, dual-listed in Singapore & Hong Kong; Suntec & Cache Logistics Trust, listed in Singapore; and Hui Xian & Prosperity, listed in Hong Kong. The group also manages 6 privately held reits in South Korea and 9 private funds investing in Asian real estate, and provides property management services and convention & exhibition services, including managing the Suntec Singapore Convention & Exhibition Centre.

ARA Asset Management

Attribution: Cromwell, ARA, Redefine, Mingtiandi, Straits Times.

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Kiwi Property sets bond rate, settles Majestic sale

Kiwi Property Group Ltd has set the interest rate for its $125 million issue of 7-year fixed-rate senior secured bonds at 4.33%/year.

The offer closed yesterday and trading in the bonds will open on Wednesday 20 December.

S&P Global Ratings has assigned an issue credit rating of BBB+ to the bonds.

Majestic sale settled

Kiwi Property said on Monday it had settled the $123.2 million sale of the Majestic Centre in Wellington to Investec Property Ltd, as the responsible entity for the Investec Australia Property Fund. Kiwi Property will continue to manage the building for Investec.

Earlier story:
15 November 2017: Kiwi Property sells Majestic to Investec fund

Attribution: Company releases.

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Cromwell makes placement to Singaporean investors in its new European reit

Brisbane-based Cromwell Property Group announced an $A170 million strategic placement on Monday to SingHaiyi Group Ltd & Haiyi Holdings Pte Ltd, entities associated with Gordon & Celine Tang of Singapore.

The Tangs are cornerstone investors in the Cromwell European real estate investment trust (CEReit), which listed on the main board of the Singapore Stock Exchange on 30 November.

SingHaiyi Group, which specialises in property development, real estate investment, real estate co-investing & real estate management services, is also listed on the Singapore main board. Haiyi Holdings is the Tangs’ private holding company. Their interests span Singapore, US & Europe.

Cromwell chief executive Paul Weightman said the company would use placement proceeds to repay short-term debt associated with its investment in CEReit and for general corporate purposes, including investment in value-adding opportunities in the portfolio and potential acquisition opportunities.

The Tangs will get 175 million new Cromwell stapled securities at A96.91c, a 4.9% discount.

ASX-listed Cromwell has become a global real estate investment manager. At 30 June, it had market capitalisation of $A1.7 billion, a direct property investment portfolio in Australia valued at $A2.3 billion and total assets under management of $A10.1 billion in Australia, New Zealand & Europe.

Cromwell bought a 50% stake in New Zealand syndicator Oyster Property Group Ltd in 2014 and Michelle McKellar took over as Oyster.

Ms McKellar established CBRE’s New Zealand operation in 1987 and later was the Hong Kong-based managing director of CBRE’s Greater China operations. She was subsequently chief executive of Jen Group and is a founding director of China-based Dash Brands. She’s been a Cromwell director since 2007.

The initial portfolio for Cromwell’s European reit comprises 74 properties with an aggregate lettable area of approximately 1.1 million m² and a total appraised value of €1.354 billion as at 30 April. The 74 properties are in 5 countries – Denmark, France, Germany, Italy & the Netherlands – and are concentrated on office, light industrial & logistics.

Cromwell has historic New Zealand ties – in the 1980s, NZSX-listed Corporate Investments Ltd, headed by Peter Masfen, created an associated listed company, Corporate Equities Ltd, to invest in Australia. Corporate Investments survived, evolving into wine company Montana Group (NZ) Ltd, and Corporate Equities went through a couple of changes before turning into Cromwell with a recapitalisation in 1998.

Cromwell Property Group

Earlier story:
6 June 2014: Cromwell buys half of Oyster, McKellar to chair it

Attribution: Company releases.

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Unibail-Rodamco strikes deal to buy Westfield

European mall owner Unibail-Rodamco SE has entered into an agreement to buy Westfield Corp, the northern hemisphere part of the former Westfield Group which has interests in 35 shopping centres in the US & the UK and total assets under management of $US32 billion.

The announcement was made yesterday in Sydney, Amsterdam & Paris. The transaction requires the approval of shareholders in both groups and is expected to close in the first half of 2018.

When Westfield split in 2014, the Australia-New Zealand part of it went into SCentre Group Ltd. That’s outside this deal.

Sir Frank Lowy AC, who’s 87 and cofounded Westfield in 1960, will retire as chair of Westfield and his sons Peter & Steven Lowy will retire as co-chief executives, but will retain other roles. The group will have its headquarters in Paris & Schiphol (Netherlands), and 2 regional headquarters in Los Angeles & London.

On completion, existing Unibail-Rodamco shareholders are expected to hold about 72% of the group’s stapled securities and Westfield securityholders- including Lowy family interests – will hold about 28%.

Unibail-Rodamco & a newly created Dutch real estate investment trust (reit) holding Westfield’s US operations will become stapled entities. The group intends to establish Chess depositary interest listed on the Australian Securities Exchange, which will be fully exchangeable with the new group’s stapled securities listed in Amsterdam & Paris. Westfield securityholders will be able to elect whether to receive the scrip consideration in Unibail-Rodamco stapled securities or the group’s CDIs.

$US72 billion portfolio

The transaction implies an enterprise value for Westfield of $US24.7 billion, and a total value of $US7.55 (or $A10.01)/Westfield security based on UnibailRodamco’s closing price of €224.10 on Monday, representing a 17.8% premium based on Westfield’s closing security price of $US6.41 ($A8.50) on Monday, and a 22.7% premium based on Westfield’s volume-weighted average closing security price of $US6.1516 over the last 3 months. 38.7 million Unibail-Rodamco stapled securities will be issued to Westfield securityholders to fund the scrip consideration and $US5.6 billion will be paid as the cash consideration, resulting in a 65% stock, 35% cash consideration mix.

The enlarged Unibail-Rodamco will own & operate a portfolio with a total gross merchandise value of over €61.1 billion ($US72.2 billion) and a pro forma proportionate net rental income of €2.3 billion ($US2.6 billion) for the 12 months to 30 June 2017. The shopping centre portfolio will represent 87% of the pro forma group’s gross merchandise value alongside Unibail-Rodamco’s existing office (7%) and convention & exhibition (6%) portfolios, both located in Paris.

Unibail-Rodamco, created in 1968, is Europe’s largest listed commercial property company, with a presence in 11 EU countries and a portfolio of assets valued at €42.5 billion as of 30 June 2017. It owns & operates 69 shopping centres and has €8.1 billion of development projects, including Mall of Europe in Brussels & Überseequartier in Hamburg.

Sir Frank Lowy.

Commenting on the transaction, Sir Frank Lowy said it was “the culmination of the strategic journey Westfield has been on since its 2014 restructure. We see this transaction as highly compelling for Westfield’s securityholders & Unibail-Rodamco’s shareholders alike. Unibail-Rodamco’s track record makes it the natural home for the legacy of Westfield’s brand & business. We look forward to seeing Westfield continue to grow as part of the world’s premier owner of flagship shopping destinations.”

Future control structure

Unibail-Rodamco will maintain its 2-tier board structure – a supervisory board & a management board. Colin Dyer, who retired as president & chief executive of real estate consultancy JLL in October 2016, will continue to chair the supervisory board. 2 Westfield board members, including Peter Lowy, will join it. A newly created advisory board, to be chaired by Sir Frank Lowy, will provide the group with independent advice from outside experts on its strategy.

The management board will consist of group chief executive Christophe Cuvillier & group chief financial officer Jaap Tonckens. The senior management committee will include top executives of both Westfield & Unibail-Rodamco.

Steven Lowy.

Steven Lowy will chair the board of OneMarket (formerly Westfield Retail Solutions) when a 90% interest in Westfield’s retail technology platform is spun off into a newly formed ASX-listed entity. The Unibail-Rodamco Group will retain the remaining 10% interest. OneMarket will have $US200 million in cash at 31 December.

Westfield Corp

Attribution: Joint release.

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