This article is from the Australian Property Journal archive
360 Capital Group has announced a swing to an interim profit and said it is in a “unique” position to grow its funds management platform.
Statutory profit for the first half came in at $3.7 million, improving from the $5.4 million loss a year earlier, coming in at 1.7c per security.
Operating profit was down 13% to $4.1 million, and operating earnings per security by 4.8% to 2.0c.
During HY25, the Group underwrote $43.5 million of loans which it then subsequently sold down to 360 Capital Mortgage REIT (TCF) and 360 Capital Private Credit Fund (PCF), with $8.6 million on the balance sheet. The group also had $4.9 million in co-investment in TCF representing 14.9% of TCF’s units on issue.
TCF undertook a capital raising in December, increasing its funds under management by $8.9 million to $33.8 million, with a further $7.4 million raised in PCF over the past six months from third parties.
“The group is in a unique position as the only Australian real estate manager with both an ASX-listed equity REIT and mortgage REIT with no legacy issues and positioned to grow its funds management platform from its current subscale base,” 360 Capital said.
“Over the past six months the foundations of this growth strategy have been established, commencing with growing real estate credit across the listed and unlisted funds, while equity investing has lagged as the Australian commercial real estate market nears the bottom of its correction cycle.
“With predictions of falling interest rates in 2025 it is expected that commercial real estate values will stabilise setting the foundations to enable the group to grow its real estate equity funds.”
Funds management revenue from credit activities totalled $0.8 million comprising $0.7 million in establishment fees and $0.1 million in base management fees from TCF and PCF.
“As one of only two ASX-listed mortgage REITs in Australia, we believe there is an opportunity to grow and diversify the TCF loan portfolio providing those investors with access to daily liquidity through the ASX while PCF provides wholesale and sophisticated investors unlisted individual loan opportunities,” it said.
360 Capital REIT (TOT) remains the group’s flagship real estate equity fund. Over the six-month period it increased its capital position through raising $1.6 million in DRPs and $3.2 million in its remaining non-core asset sale, with gearing now at the lower end of its range at 33.6%.
TOT’s first-half statutory net profit was down 18.9% to $1.9 million, and earnings per security down from 1.6c to 0.9c. Operating profit was 41.7% higher, at $2.6 million, and operating earnings down 7.7% to 1.2c per security.
Its property portfolio comprises a 50% share in the relatively new 510 Church Street office and healthcare building in Melbourne’s Cremorne, valued at $105 million, as well as an A-grade office building at 38 Sydney Avenue in Canberra’s Forrest, valued at $66.8 million, and a $30 million industrial facility in Cannon Hill, Brisbane, home to Michael Hill International’s global headquarters.
