Property dynamo Centuria Capital Group (ASX:CNI)
is set to acquire a 14-level office building in Victoria for $224 million for its new unlisted ‘Centuria Government Income Property Fund’.
Centuria will seek to raise $133 million to fund this spree balancing it with 49 per cent debt which classifies the capital raising as the country’s largest within 15 years as said by Jason Huljich, Centuria Joint CEO.
“Centuria has a 22-year track record for delivering successful fixed-term unlisted funds. This will be our largest capital raise to date for a single-asset unlisted fund with a target of approximately $133 million. In fact, it’s the largest retail equity raise undertaken in Australia for a single-asset fixed-term unlisted fund within the past 15 years".
The 20,191sqm building which is the fund’s sole asset is 100 per cent leased mostly by the Victorian Government (91 per cent) which includes City West Water (32.5 per cent), State Trustees Limited (31.1 per cent) and to the Victorian Government’s Treasury and Finance Department (27.5 per cent).
The A-Grade office building, located at 1 McNab Avenue, Footscray has a 11.8-year weighted average lease expiry on a market capitalisation rate of 4.7 per cent.
Mr Huljich said the company has seen an increased demand for office property investments amid retail punters.
“With rising white-collar employment and workforces increasingly returning to the office, we believe office asset investments will increasingly deliver strong results. Already within the past few months, we’ve witnessed several large office transactions in the domestic market.”
The Fund’s capital raise is expected to open from Thursday 1 July 2021 and anticipated to close 28 July 2021.
Shares in Centuria Capital Group (ASX:CNI)
are trading 0.19 per cent higher at $2.695.
Image from: https://www.agcoombs.com.au/our-experience/one-mcnab-avenue-footscray/