Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Caniwi Capital in $57mln purchase of Inghams properties

Caniwi Capital in $57mln purchase of Inghams properties from US investor

By Pattrick Smellie

July 18 (BusinessDesk) - Wellington property investor Caniwi Capital has bought and leased back seven of nine New Zealand properties housing Inghams Enterprises chicken farming operations in a $57 million deal that releases capital for Texas Pacific Group, the US private equity firm that paid A$880 million for the Australasian Inghams operation in March last year.

The transaction represents the New Zealand leg of TPG's plans, announced in March this year, for the sale and leaseback of A$650 million of Inghams properties in Australia and New Zealand.

With a portfolio of New Zealand properties worth some $210 million after the Inghams transaction, Caniwi specialises in very long term leased properties, taking a greater interest in the quality of leasehold arrangements and cashflows than traditional commercial property investors, who are generally more attracted to shorter leases and property valuation.

Inghams will continue to operate the facilities and has leased them from Caniwi for an initial term of 25 years with rights of renewal for a further 50 years. The properties are located largely in the rural areas around the Waikato region.

"The common theme in the assets acquired by Caniwi is exceptionally long term leases with annual rent increases linked to (inflation) with high quality tenants," said Caniwi chairman Troy Bowker. Caniwi's weighted average lease term (WALT) of 19 years represented a low risk investment philosophy and is in tune with other assets in its portfolio, including a newly renovated office building in Tory Street Wellington leased to ANZ Bank on a new 12 year lease, a student accommodation building in Boulcott Street, Wellington, leased to Victoria University on a 15 year lease, and two chicken processing plants leased to Tegel on 25 year leases.

Bowker told BusinessDesk that Caniwi has no plans "at this stage" to take its offering public, and is pursuing a strategy for earnings "more in common with a structured bond investment."

"You never rule anything out," he said of future plans for Caniwi, which he established four years ago after returning to New Zealand from an international banking career. "But our gameplan hasn't changed. We will just keep on acquiring these really solid long term leases. We believe there's some arbitrage."

However, the prices on available transactions in Auckland were "fairly toppy", while the company's focus on long term leases meant that "provincial locations are providing good buying opportunities."

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Half Full: Dairy Payouts Steady, Cash Will Be Tight

Industry body DairyNZ is advising farmers to focus on strong cashflow management as they look ahead to the 2015-16 season following Fonterra's half-year results announcement today. More>>

ALSO:

First Union: Cotton On Plans To Use “Tea Break” Law

“The Prime Minister reassured New Zealanders that ‘post the passing of this law, will you all of a sudden find thousands of workers who are denied having a tea break? The answer is absolutely not’... Cotton On is proposing to remove tea and meal breaks for workers in its safety sensitive distribution centre. How long before other major chains try and follow suit?” More>>

ALSO:

Scoop Business: NZ-Korea FTA Signed Amid Spying, Lost Sovereignty Claims

A long-awaited free trade agreement between New Zealand and South Korea has been signed in Seoul by Prime Minister John Key and the Korean president, Park Geun-hye. More>>

ALSO:

PM Visit: NZ And Viet Nam Agree Ambitious Trade Target

New Zealand and Viet Nam have agreed an ambitious target of doubling two-way goods and service trade to around $2.2 billion by 2020, Prime Minister John Key has announced. More>>

ALSO:

Scoop Business: NZ Economy Grows 0.8% In Fourth Quarter

The New Zealand economy expanded in the fourth quarter as tourists drove growth in retailing and accommodation, and property sales increased demand for real estate services. More>>

ALSO:

Scoop Business: RBNZ’s Wheeler Keeps OCR On Hold, No Rate Hikes Ahead

The Reserve Bank has removed the prospect of future interest rate hikes from its forecast horizon as a strong kiwi dollar and cheap oil hold down inflation, and the central bank ponders whether to lower its assessment of where “neutral” interest rates should be. The kiwi dollar gained. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news