Sydney-based Abacus Property Group has finished the year with a flurry of activity, taking gross assets under management to $A800 million & market capitalisation to $A432 million.
In the past week Abacus has:
finalised an $A39.3 million capital-raising with an institutional placement of 31.16 million stapled securities at $A1.26 and
bought 50 Miller St, North Sydney, from Stockland Trust for $A36.25 million on a 10.4% yield after Stockland signed its tenant, Optus, into a new development at North Ryde.
In addition, the Abacus Diversified Income Fund has:
Â· exchanged contracts to acquire 75% of the Matson Resort Cairns and has
Â· established a joint-venture investment fund with Metcash Trading Ltd.
Abacus managing director David Bastian said the placement closed oversubscribed after getting support from a number of new investors. “The increased institutional representation on the register is expected to enhance liquidity in the group’s securities, facilitating potential admission to the S&P/ASX index over time,” he said.
Gearing after the placement will fall to 21%, providing the group with the capacity to pursue further property acquisitions.
The placement was at a 9.2% annualised yield, a 3.1% discount to the closing price on 13 December & a 21.1% premium to net asset backing.
Optus remains the office tenant of the North Sydney property until October 2007, when it will move to a new head office in an $A350 million Stockland development at North Ryde. The North Sydney property has 9940mÂ² of office space over 10 levels, 6 ground-floor shops parking for 76 vehicles.
Mr Bastian said Abacus had bought $A117 million of commercial property in 6 months, growing gross assets to $A540 million and increasing net property income by $A10.5 million on an annualised basis.
Abacus Diversified Income Fund buys hotel, sets up venture with Metcash
The Abacus Diversified Income Fund’s Cairns investment is in a 4Â½-star, 242-room hotel which overlooks the Cairns waterfront. The $A24.3 million purchase from the Japanese Daikyo group is through a 75-25 joint venture.
The fund also has a 75% interest in a joint-venture investment fund with Metcash Trading Ltd set up to acquire community shopping centres. It’s bought, or is in the process of buying the first 4 for $A21 million.
Metcash, still majority-owned from South Africa, announced a bid for Foodland Associated Ltd on 6 December which would leave Foodland’s New Zealand business as a separately listed entity. In the process Metcash would also buy out the South African ownership and become an Australian company, headed by Carlos dos Santos, who ran the South African business and is non-executive chairman of Metcash in Australia.
Mr Bastian said the Abacus fund, established in 2003, had raised almost $A100 million from 3500 retail investors and managed just under $A200 million of assets.
The Abacus group’s chairman, John Thame, was Advance Bank’s managing director and has been a director of St George Bank Ltd since the 2 banks merged.
Managing director David Bastian was managing director of the Canberra Building Society for 20 years before branching out on his own. He formed Abacus Funds Management Ltd in 1996 to source & package property-based investment opportunities for retail clients.
Since then the group has created 25 property syndicates, sourced & managed more than $A100 million in secured loans, raised more than $A500 million from equity & debt markets & facilitated more than $A200 million in residential presales.
It merged a number of trusts & a small development company in 2001 with a stapled trust & company structure, acquired the funds management business in October 2002 and was listed in November 2002.
Websites: Abacus Property Group
Earlier story, 6 December 2004: Metcash proposes Foodland breakup with ASX listing for NZ business