** Note to mods - not sure if we should just have an IPO thread that we update for these type of threads? There is already the Myer and Kathmandu IPO threads? ***
Anyway this will be the first of the next wave of A-REIT IPOs.
Key features are:
- Initially seeded by seven A-grade commercial office tenants with a Sydney and Melbourne focus.
- Properties will be sourced from Investa stable of unlisted funds.
- Properties will have large weighting 'blue chip' tenants Telstra, Commopnwealth of Australia and Westpac (88% of income).
- Initial IPO gearing will be 0%; fund can be geared up to 20-30% and will have first rights on certain building's in the Investa development pipeline (including The Ark in North Sydeny).
- yield will be 7% cash and 35% tax deferred.
- Book build starts next week.
- Raising is via Macquarie and Morgan Stanley.
- Looks like an external management model under an Investa fee model.
Investors will come in at $3 per share top raise $950m. Portfolio valuation at the moment is $929m at current valuations and this shows a 7.7% initial portfolio yield. EV is $1b with the balance being capital needed for capex and lease incentives.
The source of all this is today's AFR plus some intuition but it is also obviously doing the institutional rounds at the moment. This will be on the back of strong insto demand for a pure Aussie play which is not surprising.
As I said, this will be the first of a few in 2010 IMO as the various sectors recapitalise.
For those not in the know to the background of this, Investa was purchased by some Morgan Stanley real estate trusts a few years back. This is a part of the recapitalisation and sell down of that deal I would say.