This article is from the Australian Property Journal archive
INVESTORS in the Australian Unity Diversified Property Fund have voted in favour of a capital raising period of up to 12 months.
The unlisted property fund owns a portfolio of 12 assets valued at $256.09 million.
From 3 September 2015, new Class A Units in the fund will be offered at a 5% discount to the net asset value (NAV) per unit.
The capital raising period is expected to remain open for up to 12 months and all money raised by issuing new Class A Units will be used to fund redemptions sought under a special withdrawal facility for existing investors.
Australian Unity Real Estate Investments head of property funds Mark Lumby said more than 99% of investors voted in favour of the first resolution to establish a special withdrawal facility, capped at $50 million, which will be funded by applications for new Class A Units issued during the capital raising period of up to 12 months.
In addition, approximately 99% of investors voted in favour of a second resolution to enable the responsible entity to allow a full redemption of a deceased member’s account after the capital raising period has expired and at a time when the fund’s usual bi-annual withdrawal offers are made.
Lumby said the resolutions will assist Australian Unity maintain the quality and diversification of the assets for the longer term performance of the fund and provide liquidity to those investors who wish to withdraw some or all of their investment.
“Importantly, the changes to the fund’s Constitution will enable Australian Unity to continue to manage the Fund in accordance with its investment strategy.
“This is a continuation of the long-term strategy first put in place for the Fund in 2010, when Australian Unity became the responsible entity. This strategy has involved repositioning the Fund to increase its diversification, to actively manage its assets and increase their value over time and, importantly, to provide investors access to their capital following a significant period of inaccessibility,” Lumby said.
He added that raising equity at a discount to fund withdrawal requests provides a greater level of liquidity to those investors electing to exit their investment than the current capped withdrawal offer.
“For those participating in the discounted equity raising, the forecast distribution yield will be higher than normal for a period of time for every dollar invested, as the buy price will be 5% lower than NAV per unit.
“Importantly, for those investors not participating in the special withdrawal facility, the proposal is not dilutive to the value of their investment in the Fund and provides an avenue for the longer term sustainable growth of the Fund,” Lumby concluded.
Australian Property Journal
