This article is from the Australian Property Journal archive
ASX-listed alternative real estate investment manager Qualitas has secured a second commitment of $700 million from a wholly-owned subsidiary of the Abu Dhabi Investment Authority (ADIA).
It takes committed capital in the Qualitas Diversified Credit Investments (QDCI) to $1.45 billion, and follows ADIA’s initial $700 million investment a year ago.
Qualitas’ co-investment in QDCI has increased from $35 million to $50 million.
Qualitas’ total funds under management now stands at $7.5 billion, of which 78% is in private credit and 81% is invested on behalf of institutional investors.
“A repeat commitment at this scale from a long-term strategic investor such as ADIA is a strong endorsement of Qualitas’ funds management platform, growth potential, as well as our track record and experience through multiple cycles in the highly specialised commercial real estate (CRE) sector,” said Andrew Schwartz, group managing director and co-founder.
It has grown funds under management by 80% since its IPO in December 2021.
In the financial year it has raised A$1.45 billion of incremental capital in the Australian CRE private credit sector, after announcing it had secured a $1 billion mandate with a global institutional investor in May. It now has $2.3 billion of “dry power ready to be deployed into the Australian CRE sector to take advantage of further dislocation in the financing market, as traditional financiers appear to continue to retreat, particularly in the residential and development sectors”.
Qualitas recently announced expansion of its build-to-rent platform alongside developer Tim Gurner, unveiling new projects in Melbourne’s inner east, South Melbourne and Brisbane.
ADIA can exercise options
In August last year, Qualitas granted options to ADIA under which ADIA could acquire up to 32.6 million new ordinary shares. The new mandate means ADIA can exercise its options to acquire an initial tranche of 22.8 million shares at a strike price currently at A$2.50 per share, until the options expiry date of 1 August 2024. ADIA holds options for the issue of three additional tranches. Each tranche of options has 3.26 million ordinary shares in Qualitas with the same expiry date as the initial tranche options.
Each tranche is exercisable upon financial close of $100 million additional commitments.
