AUGUSTA CAPITAL LIMITED 31 March 2016
Augusta Capital is pleased to confirm that its offering of Augusta Value Add Fund No. 1 Limited has closed after having attracted a high level of interest. As previously announced, Augusta Value Add Fund No. 1 Limited has been established to acquire a portfolio of five properties including Augusta's property at 36 Kitchener Street. Kitchener Street was acquired by Augusta in October 2015 for $16.5 million and will be transferred at that price as well. All assets in the Fund have the opportunity to add value through re-development or re- positioning. The Fund's intention is to provide investors with yield, and value upside. The Fund has a term of 5 years and will be a portfolio investment entity (PIE).
The offer of $60 million of equity was fully underwritten, with Augusta underwriting $15 million (and committing to take a minimum of $6 million of equity regardless of its underwriting liability). The offer was made to wholesale investors only.
Following processing of applications, Augusta can now confirm that it will take up $9.51 million of equity. The additional $3.51 million of equity that Augusta is taking up above its $6 million commitment results mainly from investors either not being able to complete the required application information in time (such as anti-money laundering due diligence information) or being unable to transfer funds until after the settlement date of 1 April.
Augusta has firm expressions of interests from those investors to acquire that additional
$3.51 million of equity and is currently documenting the secondary transfers, subject to receipt of all required documents. It expects to have completed those secondary transfers by the end of April and to only be holding its commitment of $6 million of equity from that date.
Settlement of the Fund will occur on 1 April 2016. Augusta receives the following fees in connection with the offer, which will be paid on settlement:
An offeror fee of $797,890 for establishing the fund;
An underwriting fee of $600,000 ($300,000 of which was received in December 2015);
An annual management fee of 1.25% of equity, reducing by 25 basis points on the sale of each property, with a base management fee of $400,000 per annum;
A performance fee equal to 20% of the amount by which pre-tax internal rate of return for the Fund exceeds 8% per annum; and
Transaction and project/development management fees are also payable, where applicable.
-ENDS-
For further information please contact: Mark Francis
Managing Director
Augusta Capital Limited | Level 2, 4 Viaduct Harbour Drive | Auckland | New Zealand PO Box 37953 Parnell | P:+649 300 6161 | F:+649 300 6162 | www.augusta.co.nz
Augusta Capital Limited issued this content on 31 March 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 31 March 2016 22:58:30 UTC
Original Document: http://www.augusta.co.nz/?ddownload=1280
