The Goodman Property Trust said today it intended to raise $165 million through new equity initiatives.
John Dakin, chief executive of trust manager Goodman (NZ) Ltd said it would use the new equity for current commitments and future investment & development opportunities in the supply-constrained Auckland industrial market.
The trust also announced the start of 5 development projects, with a total cost of $74.9 million and a preliminary portfolio revaluation of over 6%.
New equity initiatives
The trust is undertaking a $150 million placement today; NZX has granted a trading halt to facilitate the equity raising.
The price of the placement units is fixed at $2.10/unit. The new units will be allotted next Tuesday, 24 September, and will rank equally with existing units.
That will reduce the trust’s committed gearing to just 21.2%.
Goodman (NZ) chair Keith Smith said: “It’s a prudent level that provides the balance sheet capacity to fund the trust’s future development pipeline & any strategic acquisitions, while remaining within the board’s preferred gearing range of 25-35%.
“With around $215 million of projects under construction, a continuation of the current development-led growth strategy remains the priority.
“Completing the build-out of the trust’s greenfield land and activating the value-add opportunities within the portfolio remain the primary investment objectives. It’s a disciplined approach that we expect to underpin the growth of the business.”
The trust will also undertake a retail unit offer targeting $15 million of additional equity, with the ability to accept oversubscriptions of up to $10 million.
Goodman will send details of the offer to all eligible unitholders on or around Friday 26 September. It will allow NZ-resident unitholders to subscribe for up to $50,000 of new units. The closing date for applications is 18 October 2019 and the new units are expected to be allotted around 24 October.
Mr Dakin said the trust’s portfolio was full and, with no vacant warehouses available, these new build-to-lease projects will provide much needed new supply.
The 5 new projects will add 26,600m² of warehouse & office space to the trust’s portfolio.
Attribution: Company release.