Published & updated 16 September 2019
Oyster Property Group Ltd opens its offer of $17.9 million of equity today to launch its new industrial property fund.
The syndication group has 2 Wiri properties lined up to seed the fund, 12 Harbour Ridge Drive & 101 McLaughlins Rd, backed by 2 Westpac NZ Ltd loans totalling $18.68 million, including a $3.15 million bridging loan. The company says in its Oyster Industrial Ltd product disclosure statement it intends to maintain a 49.15% gearing ratio long-term.
Oyster, 50% owned by ASX-listed Cromwell Property Group, manages a $1.7 billion portfolio of retail, office & industrial properties.
The share offer has been underwritten up to $14.75 million. Minimum subscription is $50,000. The offer has 2 closing dates – 18 October if it’s fully subscribed, 31 March 2020 if not.
Update: From the product disclosure statement, I wrote: “Unlike other syndicators & property fund managers, Oyster doesn’t offer a buyback scheme or resale market.”
Oyster told me today it does facilitate resales – 123 last year for a total over $10 million.
The first 2 properties in this fund are new-builds:
101 McLaughlins Rd, built in 2018, high stud 5500m², 1326m² clearspan canopy, 350m² adjacent office building on 9605m² site; tenant Plumbing World Ltd on lease expiring 31 May 2029, 2 5-year rights of renewal, current rent $849,310/year + gst, 2%/year fixed reviews, market review at year 5 with 5% cap/collar; yield of 4.59% on current JLL valuation of $18.5 million
12 Harbour Ridge Drive, built in 2017, high stud 3500m² warehouse, 690m² clearspan canopy, 492m² 2-storey office building on 6140m² site; tenant infant milk formula processor NBL (NZ) Ltd, subsidiary of NBL (Guangzhou) Natural Nutritional Food Co Ltd, on lease expiring 30 November 2027, 2 5-year rights of renewal, current rent $632,958/year + gst, 2.5%/year fixed reviews; yield of 4.83% on current JLL valuation of $13.1 million.
Attribution: Product disclosure statement.