This article is from the Australian Property Journal archive
HMC Capital says it is six to 12 months ahead of plans to become an alternative asset fund manager with $10 billion of assets under management.
Unveiling a strong set of full-year results, HMC Capital – which rebranded from Home Consortium in March – announced two new unlisted real estate funds targeting daily needs and healthcare sectors, to go with its ASX-listed counterparts, as it continues its transition from a large-format retail and convenience retail property owner born out of a portfolio of former Masters hardware stores. It completed the sell-down of its remaining direct property earlier this year.
HMC posted 143% growth in pre-tax funds from operations to $91 million, and of 126% on a per security basis to 31.0c.
Funds management revenues jumped from $10.9 million to $64.1 million, and external assets under management grew 321% to $5.8 billion. There was $4.6 billion of gross transactions during FY22, including the $2.3 billion acquisition of rival Aventus Property Group and September IPO of the HealthCo Healthcare & Wellness REIT.
“Our strategy and ambition to create Australia’s leading ASX-listed diversified alternative asset manager is now well underway following a period of transformational growth in FY22,” HMC managing director and CEO David Di Pilla said.
“As a manager we also demonstrated strong discipline and alignment through our proactive response to the rising interest rate environment and market volatility this year. We strengthened the capital position of our funds through opportunistic asset sales which took advantage of the disconnect between property and global capital markets,” he said.
“We are currently tracking six to 12 months ahead of our previously stated AUM growth target of $10 billion by the end of 2024 and we believe the current market environment is creating compelling and strategic opportunities which could accelerate our growth.”
HMC has just launched the HMC Capital Partners Fund 1 with a $300 million first close fund raising, which made a first investment in Sigma Healthcare that is now up 22% on the purchase price.
Di Pilla said the fund will target “undervalued asset-rich companies where we can influence positive change”.
“The fund expands our platform into new alternative sectors including private equity and gives us greater flexibility to deploy capital during times of market volatility and dislocation.”
HMC believes its FFO result is “repeatable as we continue to scale our existing platform and execute on transformational opportunities” but the “unpredictable nature of the timing of transactional income makes it challenging to provide an FY23 FFO forecast at this time”
FY23 distributions per security guidance of 12.0c is in line with FY22.
