May 17, 2018 / 9:30 PM / 4 months ago

UPDATE 2-NZ's Goodman Property Trust sells VXV portfolio to Blackstone funds

* 88,000 sqm VXV portfolio comprises seven office buildings

* Singaporean fund GIC holds 49 pct of VXV portfolio via a JV firm

* Deal comes after rumoured Blackstone purchase of HNA Group’s Sydney building (Adds background on Blackstone Group’s recent activity)

By Aaron Saldanha

May 18 (Reuters) - New Zealand’s Goodman Property Trust (GMT) will sell its majority-held VXV office portfolio to a number of Blackstone funds for NZ$635 million ($436.44 million), in the U.S. private equity giant’s latest move further into Oceania.

The deal was announced by the property trust’s manager, Goodman (NZ) Ltd, on Friday and represents a move away from commercial property for GMT in the country as it reorients itself closer to Auckland’s industrial market.

The VXV portfolio is owned by Wynyard Precinct Holdings Ltd, a joint venture firm held 51 percent by GMT, with Singapore’s sovereign wealth fund, GIC, holding the balance.

The manager said both firms agreed to the sale, which is not expected to have a material impact on GMT’s earnings or distributions for fiscal year 2019. The manager did not name the Blackstone funds involved in the sale.

The VXV portfolio includes seven low-rise office buildings, totalling about 88,000 square metres.

“With an expected loan-to-value ratio of below 20 percent following this sale, we have substantial capacity for future development and investment opportunities,” said John Dakin, chief executive officer of GMT’s manager.

Dakin said that following the deal and other contracted sales, GMT’s NZ$2.2 billion portfolio will be almost fully invested in the industrial market of New Zealand’s largest urban area.

While Blackstone has been active in the Australia-New Zealand region, the Goodman deal marks the latest move in the countries’ real estate space for the alternative investment firm’s largest fee-grossing line of business.

According to sources, a Blackstone unit was the buyer when indebted Chinese conglomerate HNA Group announced the sale of a Sydney office building for A$205 million ($154.00 million) earlier this year.

The growth of Blackstone’s real estate business has been a factor in former real estate head and Blackstone lifer Jon Gray being named its chief operating officer and president in February.

Beyond the real estate space, Australian automotive aftercare firm AMA Group sold its vehicle panel repair arm to funds advised by Blackstone in April for an enterprise value of A$508 million. ($1 = 1.4550 New Zealand dollars) ($1 = 1.3312 Australian dollars) (Reporting by Aaron Saldanha Additional reporting by Chris Thomas in Bengaluru Editing by Leslie Adler and Chris Reese)

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