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

 

Scoop Business: Wheeler Downplays Scope For ‘Large’ Rates Fall

Reserve Bank governor Graeme Wheeler says some market commentators are predicting further declines in interest rates that would only make sense for an economy in recession, although some easing is likely to be needed to maintain New Zealand’s economic growth. More>>

ALSO:

Ruataniwha Dam: Consent Conditions Could Mean Reduced Intensity

Legal advice sought by the Hawke’s Bay Regional Council on the Ruataniwha Dam consent conditions has confirmed that farmers who sign up to take water from the dam could be required to reduce the intensity of their farming operation to meet the catchment’s strict nitrogen limit. More>>

Health And Safety: Bill Now Sees Rules Relaxed For Small Businesses

Health and safety law reform sparked by the Pike River coalmine disaster has been reported back from the industrial relations select committee with weakened requirements on small businesses to appoint health and safety representatives and committees. More>>

ALSO:

Bearing Fruit: Annual Fruit Exports Hit $2 Billion For First Time

The value of fruit exported rose 20 percent (up $330 million) for the June 2015 year when compared with the year ended June 2014. Both higher prices and a greater quantity of exports (up 9.0 percent) contributed to the overall rise. More>>

ALSO:

Interest Rates: NZ Dollar Jumps After RBNZ Trims OCR

The New Zealand dollar jumped more than half a US cent after Reserve Bank governor Graeme Wheeler cut the official cash rate by a quarter-point and said the currency needs to be lower, while dropping a reference to criteria that justified intervention. More>>

ALSO:

Drones: New 'World-Class' Framework For UAVs

The rules, which come into effect on 1 August, recognise the changing environment and create a world-class framework that accommodates ongoing development while still ensuring the safety of the public, property and other airspace users. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news