ASX-listed property investor Abacus has successfully raised $250 million to pursue more than $710 million of new investment opportunities with a focus on office markets and self-storage.
The property group launched the fully-underwritten placement at $3.95 a share, with the proceeds used to increase its stake in the Australian Unity Office Fund, pursue opportunities in self-storage and finalise the off-market acquisition of a Sydney CBD office asset.
Abacus, which announced that it had swiftly completed the placement on Thursday, is the latest trust to join the REIT raising spree — joining Cromwell, Centuria, Dexus, GPT, Charter Hall and others in tapping the market for funds.
Abacus said the proceeds will also firm up its capital commitment in a $230 million Church Street office complex it is developing with Salta Properties as it transitions to a more annuity-style business model.
“The placement enables us to accelerate this transition and positions Abacus for future growth beyond the near-term identified opportunities, with low gearing and over $900 million of acquisition capacity.”
Abacus said it had settled about $180 million in self-storage acquisitions over the last year, with an additional $63 million under contract and $34 million under consideration. The group has identified a development pipeline of 35,000sq m, flagging anticipated annual returns of more than 9 per cent.
Abacus also acquired a minority interest in Storage King.
Abacus’ strategic evolution into self-storage comes as it reduces its exposure in residential and retail — offloading the Liverpool Plaza and Bacchus Marsh malls and disposing about $150 million of residential investment.
The group has reworked its existing retail portfolio, entering into a joint venture with ISPT for a 50 per cent stake in two Abacus retail assets — bringing in more than $200 million after the settlement of Bacchus Marsh.
Abacus said its preliminary unaudited financial year profits sit at 24 cents a share, with a declared distribution of 18.5 cents — a decline from 31.7 cents a share a year earlier. Abacus said its net property rental income has grown 8 per cent over the year to $114 million.
Abacus is concurrently undertaking a share purchase plan at $3.95 a share, which is capped at $25 million.
Abacus resumed trading on Thursday, with its shares closing down 3 per cent at $4.14.