Tauranga group closes $44 million property raise

Closed: New offer triples previous closings, says Property Managers chief executive Scott McKenzie. Photo / File

Tauranga-based Property Managers Group has closed its largest combined offer, raising more than $44 million in five weeks across two of its managed investment portfolios, says chief executive Scott McKenzie.

The portfolios are Pacific Property Fund and a new dedicated office managed investment scheme, PMG Direct Office Fund.

The capital raised was three times more than previous offers the company has taken to market, said Mr McKenzie.

"Nearly 30 per cent of the funds raised came from investors who are new to Property Managers Group and who have not invested in any of our investment portfolios previously, while nearly $32.5m was raised from existing investors," he said.

Property Managers Group plans to settle the 11 acquisition properties before Christmas, with three properties added to Pacific Property's existing portfolio, and eight going into the new PMG Direct Office Fund.

Pacific Property will acquire the former State Insurance building at 46 Spring St where it has its Tauranga office, and Stag Park, an industrial logistics hub in Taupo.

The third acquisition is Pacific Property's first acquisition in Whangarei, which is tenanted by the Farmers Trading Company on a new 15-year lease.

Pacific Property director Denis McMahon said Pacific Property's assets offered investors geographical and category diversity, with Stag Park Taupo representing a significant redevelopment opportunity.

"We're thrilled to be bringing three new properties into Pacific Property," he said.

Pacific Property is targeting a gross dividend return of 7.2 per cent per annum for the full financial year to March 31, 2018. The Direct Office Fund is targeting a gross distribution return of 7.5 per cent per annum for the first full year to March 31, 2018.

Mr McKenzie said investors had told the company they liked the fact that it managed all of its properties in-house.