Vinta launches new fund with capital trio

5:00 AM Wednesday July 27, 2016 Colin Taylor

The 12 storey building at 33 Bowen Street occupied by the Ministry of Education.

Property group Vinta Funds Management Limited, one of the largest fully integrated private property groups in Australia and New Zealand, is launching a new $121,230,000 direct, open-ended and wholesale unlisted property fund targeted at New Zealand wholesale investors.  

“Seed assets for the fund will comprise three top quality Wellington CBD office buildings,” says Simon Donohoe, Head of Distribution for Vinta. They are:

• 33 Bowen Street - the recently refurbished and award-winning 12-storey headquarters of the Ministry of Education;

• 110 Featherston Street – an eight-level office building with Māori Trustee and NZ Crown tenants; and

• 13-27 Manners Street – a 15-storey building occupied by quality public and corporate tenants including Nokia and Healthcare of New Zealand.

Vinta is seeking $80.6 million in total equity from investors, of which up to $16 million will be co-invested by Vinta.

The price per unit is $1 with investors applying for a minimum of 200,000 units and multiples of 25,000 thereafter. Forecast income distribution yield for the fund for the first year is 7.6 per cent annualised..

Donohoe says the fund is only available to permitted investors who do not require disclosure under Part 3 of the Financial Markets Conduct Act 2013 which includes wholesale investors.

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The 15 storey property 13-27 Manners Street. 

He says the fund will be overseen by a board of directors led by Fiona Oliver as Chairperson. “She brings diverse domestic and international governance and business leadership experience, developed over more than 25 years in addition to her specialist knowledge of the capital markets, investments and the financial services sector.” 

Applying a core/core-plus investment strategy with initial gearing at 35 per cent of property value, the fund offers a weighted average lease term (WALT) of 9.6 years, measured by income at March 31, 2016.

Donohoe says over 72 per cent of income is sourced from the Crown and from global telecommunications giant Nokia. “The seed portfolio delivered an internal rate of return of 12.1 per cent per annum over 14 years to June 30 last year.”

“The Vinta Fund offers strong fundamentals for long-term wholesale investors, for whom stability and income over time are critical factors. It will provide low volatility and real-property returns to wholesale investors, who can gain access to a slice of the market that is starved of product.

“A key priority of the fund will be to continue to acquire additional properties that complement its investment strategy and provide diversification benefits across asset class, geography, tenant type and income.”

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The eight level building at 110 Featherston Street.  

Donohoe says the fund will be managed by Vinta Funds Management Limited (VFML), a wholly owned subsidiary of Vinta. “We have a 60-year history and track record in developing, owning and managing property - including 15 years as active owners of the three office assets going into the fund.”

Vinta has assets under management in excess of $800 million with its property portfolio built up over 60 years and comprising major commercial and retail assets in New Zealand and Australia. Assets include commercial assets in CBD precincts anchored by major government and corporate tenants and quality shopping precincts in locations anchored by major retail brands.