Michael Chow addresses the crowd at the launch event. Photo / Supplied
Michael Chow addresses the crowd at the launch event. Photo / Supplied
Stonewood Group has launched a business arm dedicated to raising capital to fund property development.
The group, co-founded by brothers Michael and John Chow, unveiled Stonewood Capital last night. Among those at the event included National leader Judith Collins and former Prime Minister Sir John Key.
The division has beenlaunched to provide an alternative to bank funding for developments by the Stonewood Homes franchisees and licensees, said John Chow.
The organisation's first venture will be a $25 million residential property vehicle. That initial target could be extended to $50 million, depending on demand levels.
"We are personally investing our own money into Stonewood Capital, amounting to 10 per cent of the vehicle. And being the first money in, we will be the last money out", John Chow said.
He differentiated the Stonewood Capital approach from bank funding, saying his organisation will not require significant presales.
Former Prime Minister Sir John Key with National Leader Judith Collins in attendance at the event. Photo / Supplied
With Stonewood Group assets already totalling $500 million in value, he said the company was already well capitalised for home building in New Zealand.
"Property development works best with flexible capital, and funding Stonewood Homes developments through Stonewood Capital will enable residential project construction to move fast to meet the underlying demand," he said.
The Stonewood Group already has a number of developments in the pipelines, including five two-storey dwellings in Milford, 10 residential townhouses in Albany, and 16 residential dwellings and three retail opportunities in Belmont.
"With 20 Stonewood Homes franchisee builders nationally, we have the capability, scale and the resources to deliver about 200-300 more homes than we currently are," John Chow said.
John Chow outlines plans for the business. Photo / Supplied
Stonewood Homes has built more than 8,000 homes in New Zealand since the company first opened its doors in 1987.
John Chow said Stonewood Capital's residential ambition was only the start and that there were further plans for a commercial arm.
This would potentially involve funding several significant redevelopments such as the recently purchased 280 Queen Street building which, following a $120 million refurbishment project, is forecast to be valued at over $300 million.
