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
6 June 2014: Cromwell buys half of Oyster, McKellar to chair it
Attribution: Company releases.