Sep 24 2018Add to Favorites
In 2014 we co-invested with former Managing Director and board member Steve Day, in the headstock of real estate investment management business, Propertylink. Investing in and managing major industrial warehouse portfolios, office tower portfolios, and infrastructure projects, other Propertylink co-investors included Goldman Sachs and London’s Duke of Westminster.
Propertylink was set up with a key focus on industrial logistics property and listed on the ASX with the aim to be an attractive Australian platform combining a large industrial portfolio with a successful investment business with $1.9b funds under management.
The Australian IPO yielded our MP Funds Management investment partners a net annual internal rate of return of 21%.
Most recently just a few days ago, private equity-backed logistics platform ESR is set to take over Propertylink in a $723.4 million deal ($1.20 per share) after both sides announced they had struck a binding agreement on the buy-out.
The deal follows nearly a month of due diligence by the powerful Asia-based platform, which only recently established a presence in the Australian market, and seeking a local industrial platform in Australia, acquired the CIP platform from Charter Hall in July in a $102.5 million deal.
ESR has also taken minority stakes in both the listed Centuria Capital Group, 14.9% and the Propertylink platform, 19.9%.
In September this year, Propertylink launched a $755m takeover bid for the listed Centuria REIT, at the same time taking an 18% stake in the business.
In response to Propertylink's bid for Centura, ESR as a minority shareholder in both Centuria and Propertylink put forward their bid for Propertylink.
As part of its offer to acquire Propertylink, ESR also confirmed it plans to vote its 19.89 percent stake against a move by Centuria to spill the Propertylink board.
ESR is a pure play, pan-Asia logistics real estate platform, one of the largest in the region, with assets under management of more than $US12 billion.
ESR is backed by Dutch pension fund managers APG and PGGM, Canada's CPPIB, Goldman Sachs, Chinese insurance giant Ping An, and South Korean conglomerate SK Holdings.
Mandi Prager is the principal of MP Funds Management. MP Funds Management has provided investment funding for over $1.1bn of real estate based investments across 22 transactions and produced an average annualised investment return of 21-22% (IRR).
MP Funds Management update 1st Oct 2019 and investment pipeline: MP Funds Management has completed its co-investment into the acquisition of a 52,000sqm office asset in Brisbane CBD, right opposite the railway and with 98% of rental income underpinned by government tenants.
MP Funds Management has provided investment funding for approximately $1.3b in unlisted real estate since 2013 and has provided an investment return of approximately 21% annually. Whilst MP Funds Management focuses on unlisted real estate, I am always fascinated by innovation and I personally will sometimes invest in other areas. Recently I caught up with the founder of a very clever new Australian – based app called Stake https://stake.com.auwhich is a Business-to-Consumer based platform that enables Aussies to get direct exposure to the USA equities market.
United States of America
In November 2014 we co-invested with another Manager into the acquisition of a 13-level North Sydney CBD office tower for a purchase price of $36.75m or $4,665 per sqm. A total of $19.5m equity was invested with a gearing ratio of 65%, debt was locked in at a rate of c.4% for the intended five-year investment period.
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