Analysts welcome property listing

An initial public offering for a new $100 million listed real estate company will give investors an opportunity to tap into rising property prices, analysts say.

The company, which involves developer Jamie Peters and the sons of Auckland investor Peter Francis, will be called Kermadec Property Fund and plans to raise $60 million from the public.

It will register a prospectus next month and has been developed by property syndicator Augusta with real estate developer Starline Group.

Mark Lister, an analyst with ABN Amro Craigs and Shane Solly, investment manager at Goldman Sachs JBWere Asset Managements, both welcomed the listing. Lister said the sector had been growing in wealth but the number of listed investment vehicles had been shrinking.

"The number of options for investors has fallen because there's investor appetite for property and a new company would generate demand," he said.

"A new company would be well-received, but whether it would be attractive to own would depend on dividend yield and valuation of the portfolio, sector exposure, quality of the assets, type of properties and who was managing the company."

Solly said he was watching the listing with interest.

"It is good to see a new listed property security on the market, given the consolidation that has happened over the last few years. The property portfolio is interesting," he said.

Augusta Funds Management yesterday announced it would float the new company which would buy properties worth $100 million.

Companies Office records show Augusta was registered last month and its directors are Chris and Mark Francis, Starline Group's Jamie Peters and Roger Coulson, formerly of Strategic Finance but now Starline's chief executive.

One of the buildings in the float will be part of the Finance Centre which Peters bought from listed developer Trans Tasman Properties two years ago in an arrangement under which he got Brookfields House, the Simpson Grierson Building and the Finance Carpark.

But Peters soon demonstrated he had bought with the intention of selling. By April last year, Bayleys senior commercial broker Bruce Whillans was selling Brookfields House, which he said was valued at $19.5 million.

Peters, a media-shy but influential developer, is working on the $750 million Gulf Harbour project north of Auckland. In 2001, his Starline bought 100ha of Gulf Harbour land for $55 million from a company owned by Singaporean investor Goh Cheng Liang, the project's founder.

Peters is a relative of the Minister of Foreign Affairs, Winston Peters.