Property Managers Group will open its PMG Direct Office Fund to new subscriptions next Monday.
The Tauranga-based syndicate manager is seeking $20.16 million in subscriptions to buy 2 properties in Auckland & Hamilton for $29.74 million.
Property Managers launched the PMG Direct Office Fund in late 2016 with 6 properties in Auckland, Tauranga & Rotorua, and will sell one of those, at 22 Amersham Way, Manukau, with settlement expected on 28 March.
The 2 new properties are at 65B Main Highway, Ellerslie, valued at $21.8 million (just above purchase price), and 410 Victoria & 12 Alma St, Hamilton, valued at the purchase price of $8.1 million.
After those 3 transactions, the portfolio will have a value of $81 million.
Units in the fund were originally priced at $1. The new units are priced at $1.12. The forecast pretax gross distribution/unit/year on the new offer is 6.7% for the next 2 years, which equates to a 7.5% return on the original investment price of $1.
The offer is scheduled to close on Friday 12 April, and needs to be fully subscribed to proceed.
PMG, the manager, and another of its funds, the PMG Capital Fund Ltd, have committed to subscribe for up to 13.5 million units, leaving a minimum $4.5 million to be raised in the offer.
Fully subscribed, the fund’s gearing ratio will rise from 33.8% to a range between 38-40%.
7 November 2016: Property Managers offers new shares as it reorganises syndicates
Attribution: Company promotion, product disclosure statement.