After launching the first-ever RMB-denominated bond fund to buy Australian real estate last week, Agincourt Capital has said it plans to invest in AUD500m
After launching the first-ever RMB-denominated bond fund to buy Australian real estate last week, Agincourt Capital has said it plans to invest in AUD500million of real estate by January, reported Bloomberg. Apparently, the Hong Kong-based firm plans to announce contracts on two buildings within the next two weeks and plans to spend the rest of the fund’s first capital by early 2012. The five-year convertible bonds issued by Agincourt will provide investors with an annual coupon of 4 per cent. That they’re denominated in RMB is to take advantage of record deposits of the currency in Hong Kong, not to mention its continued appreciation against the greenback. The first tranche of AUD500million is hoped to be secured by the end of September followed by a second AUD500million in early 2012 according to Agincourt CEO, Craig Turnbull.
Commenting on Australia’s real estate market, Turnbull said that there’d been a complete lack of new supply of commercial property over the last “three or four years”, adding that residential projects were also suffering from a lack of funding. Turnbull said that AUD350million of the first funds raised would be invested into “core” office properties with the other AUD150million going into developments. “This allows us to go for smaller assets, AUD30million to AUD50million, which offer us higher returns,” Turnbull was quoted as saying. He added that by combining smaller assets with a couple of larger assets, yields would be higher “and our chance for uplift is higher”. The two buildings Agincourt is looking at are believed to include a multistage development on Queensland’s Gold Coast and an apartment complex joint venture in Brisbane.
