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Augusta buys Broadway beauty for $143m

NZ Newswire logoNZ Newswire 21/12/2016 Rebecca Howard

Augusta Capital says it has inked a deal to purchase a development in Newmarket, Auckland, for $143 million.

The Auckland-based fund manager and property investor said it has entered an agreement with Mansons Broadway, which will continue to construct the building at 33 Broadway.

Under the agreement, an Augusta nominated syndicate or fund will ultimately acquire the property following an equity raising, it said in a release to the New Zealand stock exchange.

Augusta Funds Management said it has entered unconditional underwriting commitments for the equity component, but the structure of that investment entity is still being finalised.

The deal announced Thursday involves a fixed amount payable at settlement, further drawdowns made on a cost to complete basis as it progresses and retention amounts payable on achievement of certain milestones.

The agreement is conditional on several things including all parties agreeing on the loan facility agreement and associated documents by Jan 24 as well as approval from the anchor tenant by the end of January. Settlement is currently slated for July 1, subject to earthworks and piling having been completed.

Augusta diversified into funds management last year when it bought KCL Property and Investment Property Titles. It now has around 155 properties to manage and some $1.4 billion in funds under management, according to its website.

The company said Thursday's deal was strategic as it moves into the funding and development of investment grade assets.

Augusta's shares last traded at 95 cents and have declined 5 per cent this year.

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