This article is from the Australian Property Journal archive
GPT has launched an $800 million capital raising to fund its increased share in the Darling Park 1 & 2 and Cockle Bay Wharf complex after a shuffling of ownership interests, and to also further its investment in the buoyant logistics sector.
Most of the raising will go towards GPT’s $531 million purchase of a 25% interest in the project, which overlooks Darling Harbour and is co-owned by Brookfield and AMP Capital, taking the combined ownership of GPT and its GPT Wholesale Office Fund to 75%, after the latter exercised a pre-emptive right over the asset.
Brookfield is believed to be reducing its 30% holding, and AMP Capital increasing its share by 5% to 25%.
Through the Darling Park acquisition, GPT will also have a 25% interest in the proposed $649 million Cockle Bay Park development, for which stage one was given development approval by the NSW Independent Planning Commission last month despite objections from Sydney Council.
A fourth tower in the precinct had been redesigned and its height slashed from 235 metres to 183 metres, and will have around 63,000 sqm of office space across 40 levels, as well as 10,000 sqm of shops, restaurants and bars.
The Darling Park 1 & 2 component comprises two 27-level towers with a total of 103,600 sqm of office space, and Cockle Bay Wharf will have 8,151 sqm of dining and retail space.
“The group is excited by this compelling Sydney office investment opportunity. Darling Park provides the group with an enhanced exposure to the strong Sydney office market via modern, high quality assets and access to future growth through the Cockle Bay Park development,” GPT’s chief executive officer, Bob Johnston, said.
GPT is also looking to raise up to $50 million through a non-underwritten security purchase plan, taking the total equity raising to $850 million.
Johnston said the proceeds would also be applied to funding the next stage of growth from within the group’s development pipeline across the office and logistics sectors, ensuring GPT “has the capacity to continue to make additional investments, while also maintaining a very strong balance sheet position”.
The new developments now underway include a 26,400 sqm facility at Truganina in Melbourne’s west, with a development cost of $33 million, and respective facilities in Brisbane’s Wembley Business Park, of 20,500 sqm, pre-leased to an international logistics provider and with a development cost of $44 million, and of 14,350 sqm at $25 million.
GPT is also “well progressed” on securing a new 50,000 sqm pre-leased logistics investment opportunity in Western Sydney via a fund-through arrangement.
The group has just acquired a $212 million portfolio of logistics assets in Sydney at an initial passing yield of 5.4%, and is on track with the delivery of its 26,000 sqm, $266 million office development at 32 Smith Street, Parramatta, which will be anchored by QBE.
Commencement of the new office and retail development at Melbourne Central is expected in 2020.
GPT’s hefty raising follows major landlords and developers Mirvac undertaking a $750 million raising for several major acquisitions totalling $2 billion, including a build-to-rent project on the high-profile Munro site opposite Melbourne’s Queen Victoria Market, and Dexus’s $900 million raising to partially fund its record-breaking $1.476 billion purchase of 80 Collins Street in the Melbourne CBD.
New securities as part of GPT’s placement will be issued at a fixed price of $6.07 per security, at a 4.1% discount to Tuesday’s closing price, while new securities issued under the placement will be offered at $5.94 per GPT security and rank equally with existing securities, and be entitled to the full distribution for the six months ending 30th June.
