23 November 2006
St Hilliers Property and Macquarie have today announced the formation of an exciting new property venture that seeks to capitalise on a strong working relationship and complementary skills to compete in the property funds management and development arena. Macquarie has made a $30 million equity investment to St Hilliers Property, recapitalising the business to facilitate growth plans.
St Hilliers Executive Chairman, Tim Casey, said the investment by Macquarie reflected a strategic decision to divide St Hilliers existing construction and property activities into two separate businesses, with dedicated balance sheets and boards, and a clear focus on their core operations.
Mr Casey said he was delighted such a pre-eminent financial and real estate institution recognised the potential of St Hilliers Property.
"Together we present quite a formidable team. Macquarie’s credentials and experience in wholesale funds management will greatly complement our proven track record of creating a quality deal flow of development and value-add opportunities," Mr Casey said.
Co-Head of Macquarie Real Estate Capital Matthew Banks said Macquarie’s investment reflects the long and successful relationship between the two groups.
"We have worked with St Hilliers across a number of property activities and are confident the new venture will become a significant operator in property funds management and development," Mr Banks said.
Mr Casey will remain the majority shareholder and Chief Executive Officer of the new property venture. The new business will have a distinct brand, which is currently being developed, and will be independent from Macquarie’s real estate funds management and finance business.
A new board has been established for the property business and comprises Messrs Tim Casey, Trevor Gerber (Director of the management companies of Macquarie Airports Group and Macquarie ProLogis Trust), Dennis Broit (ex Chief Financial Officer, Mirvac) and Macquarie executives, Matthew Banks and Graeme Wilson.
The new property business will continue to focus its activities on its already established diversified property development and wholesale funds management platform with a mandate to operate Australia-wide and potentially in New Zealand.
A third wholesale, value-added fund is proposed to be launched early next year and is expected to raise between $70 million and $100 million. Three seed properties already have been acquired for this fund.
The new property venture will operate independently of the St Hilliers contracting business, of which Mr Casey is the major shareholder. The day-to-day management of St Hilliers Contracting will continue to be the responsibility of the established management team, which also has a shareholding in the business.
"Given what has happened in the construction industry locally over the past decade I have formed the view that our construction business best remains as a private entity," Mr Casey said.
About St Hilliers
Established in 1989 by current Executive Chairman, Mr Tim Casey, St Hilliers is a leading Australian property group providing expertise and services in property development, design management, contracting, asset management and funds management. Its operations are focused on the primary institutional markets of Sydney, Melbourne and Canberra. The St Hilliers group has completed major contracting projects and initiated and managed successful development projects for both private and public sectors clients and business partners. Currently it is involved in excess of $450 million of development projects and is completing construction projects valued at more than $500 million.
About Macquarie Real Estate
Macquarie Real Estate is a diverse, global business with a unique blend of real estate and financial expertise.More than $22 billion in property assets is managed by entities within the Macquarie Bank Group and by associates across a portfolio of listed and unlisted property trusts, unlisted investment and development funds, globally.
For more information please contact:
Macquarie Property Investment Management
Tel: (612) 8232 7227