Pacific Property brings its largest public offer to market
TAURANGA 6 August 2019 - Today PMG Property Funds Management Ltd (PMG) has launched an opportunity to invest in Pacific Property Fund Limited (Pacific Property), the largest and most diversified unlisted commercial property fund, managed by PMG.
Available to retail investors the funds raised during the Offer will see Pacific Property complete the largest industrial property transaction in the Wellington region so far this year. The high-quality industrial park at 43 Seaview Road and 120 Hutt Park Road in the sought-after area of Seaview, will be acquired for $56.17m following the Offer period.
PMG CEO Scott McKenzie says the Seaview properties will join 12 quality, New Zealand commercial properties which are diversified by sector, location and tenant mix in Pacific Property Fund.
“Over the last two years Pacific Property has delivered, on average, gross cash distribution returns to shareholders of 7% after expenses but before tax,” says McKenzie.
“This represents a good return when compared to cash investments such as term deposits which returned 3.24% over this same period, and considering the average rate of 4.20% at which the NZX50 is currently delivering.”
“With the Official Cash Rate at an historic low, we’re seeing an increase in investors moving away from term deposits and listed stocks to higher cash return investments like Pacific Property’s expected return for the full year ended 31 March 2021 of 7% ,” says McKenzie.
PMG is offering investors a minimum of 36,000,000 new shares and a maximum of 40,000,000 new shares in Pacific Property with a minimum parcel size of 20,000 shares ($21,000) and 10,000 ($10,500) thereafter.
Pacific Property is currently paying an equivalent annualised gross cash distribution return of 7.25 cents per Share. Pacific Property is targeting an increase in the annualised gross cash distribution return (net of expenses but before tax) of 7.35 cents per share following settlement of the Wellington properties from 1 October 2019.
“The six-year-old unlisted commercial property fund has an AA rating by investment research house FundSource, a proven track record of delivering regular and reliable cash returns, with good liquidity and value growth over time, and is professionally-managed by a manager with 26 years of experience,” says McKenzie.
Pacific Property currently has a portfolio value of $189 million with 12 industrial, office and retail properties which are home to 66 diverse tenants. Following the Seaview properties acquisition, the total value of the Fund’s portfolio will be $250 million with a weighting of 62% to the strongly performing industrial sector.
Those interested in the Offer can download a Product Disclosure Statement by visiting www.pmgfunds.co.nz or by contacting PMG’s investor relations team including Matt McHardy in Tauranga, Mat Harvie in Auckland, or Jordan Forrest in Canterbury on 0800 219 476.
The Offer is live on 6 August 2019. Applications to acquire shares must be received no later than 5:00pm on 25 September 2019. This Offer is not available to investors outside of New Zealand.