- The latest offering included Australia's largest single-asset retail capital raise for an unlisted fund
- The raise closed early thanks to high demand
- A disinvestment for another government-tenanted asset resulted in 8% returns
Centuria Capital Group’s (ASX: CNI) strategy to secure high-quality office assets that are government-tenanted is resonating with investors.
The latest offering included Australia’s largest single-asset retail capital raise for an unlisted fund, closing early thanks to high demand.
The Centuria Government Income Property Fund (CGIPF), which was only launched on 1 July 2021, closed its $133 million capital raise after acquiring an A-grade office building in Footscray, Victoria.
Over 90% of the building is leased to Victorian government departments and agents such as City West Water, State Trustees Limited and the Treasury and Finance Department.
Centuria Joint CEO, Jason Huljich, said across the group platform, there are $6.7 billion of office assets under management with about 28.5% of these currently leased to local, state or federal governments.
“Quality assets backed by resilient government tenants form a key acquisition strategy across the Centuria Group, which includes our listed and unlisted funds in both Australia and New Zealand,” said Mr Huljich.
“Our strong conviction in this acquisition strategy is also illustrative with our newly launched Centuria Government Income Property Fund (CGIPF), closing early due to significant investor demand.”
Jason Huljich, Centuria Joint CEO
Another success is the Centuria Scarborough House Fund (CSHF) which divested its 12-storey A-Grade building for $83 million – delivering a yield of about 8% per anum to investors.
The property was originally purchased in November 2016 for $72.3 million and is currently 99% leased to the Australian Government Department of Health.
Centuria’s head of Funds Management, Ross Less, added that the rationale for the fund was to provide investors with stable, high yielding income returns from commercial property in the health precinct of Canberra.
“Canberra benefits from a high proportion of public sector employment. Other markets, such as Victoria, are increasing their public sector workforce, which has a knock-on effect for the office market and reinforces our investment strategy for our Footscray office acquisition, which is CGIPF’s single asset.”