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Property Syndication

Delivering returns to customers from high performing property assets under management

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  • Raising Capital Since 2010 NZ Wide
  • Investor Equity $580 Million
  • Property Sales $1.175 Billion
Property Syndication

A property syndicate is a direct property investment where a number of investors pool their capital to purchase real estate, which forms the syndicate or scheme. Syndications offer above-average cash returns with the relative security of proportional ownership and are an effective investment tool in our client’s portfolios.

 

Colliers Syndications team specialises in bringing high-performing property syndication opportunities to the market on behalf of a range of clients. We leverage the knowledge and experience of our people across the New Zealand market, whilst drawing on Colliers national market reach, meaning we're well positioned and connected to tap into proportionate ownership markets nationwide. 

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Property syndication provides investors the opportunity to access premium, high yielding commercial and industrial property offerings with minimum investments ranging from $10,000 to $50,000. This involves investment in proportionate ownership schemes, allowing experienced property investors to enjoy earnings from high performing property without having to self manage the assets.

Syndication is typically a passive form of ownership most commonly in office, industrial or retail property and comes with a full management package. It enables smaller investors to participate in higher-yielding property that would otherwise only be available to wealthier individuals or institutional investors.

Colliers syndication experts specialise in bringing syndication schemes to the market, linking investors with high-performing schemes and opportunities.

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The returns from commercial property tend to be more stable over time versus volatility compared with other asset classes.

Cash returns available from property syndications are generally higher than bank term deposits and are more likely to outperform residential property investments.

Investor’s funds are pooled and they become investment partners in good buildings, with good tenants and long leases. The property is fully managed on behalf of the investors with forecast cash returns distributed monthly into the investor's bank account.

Many investors choose to benefit from diversification through investing in properties in various locations (throughout New Zealand and Australia) and differing property types such as retail, commercial and industrial, along with different tenant profiles.

 
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A subscriber has the right to sell a proportionate share at any time during the term of the scheme, subject to the requirements of the relevant ownership and management deed or deed of participation relating to the syndicate.

For example, all outstanding amounts need to be paid by the subscriber and relevant anti-money laundering verification information needs to be provided for the prospective purchaser of the proportionate share.

Our clients operate a secondary market facility to arrange secondary transfers. There is also the ability to purchase secondary units on the Syndex Exchange, a secondary unit trading platform.

 
Property Syndication secondary sales

Property is purchased using investor equity or through a blend of investor funds and borrowings from a bank. The amount borrowed from the bank will be secured by non-recourse first mortgage over the property. The purchase will be carried out by a nominee who will hold the title to the property as a bare trustee on behalf of each investor on a proportionate basis.

Most syndicates have a minimum investment requirement, which generally ranges from $10,000 to $100,000. Once the property has been purchased, a Scheme Manager is appointed and becomes responsible for the day to day management of the asset. The syndication company will take care of the accounting and distribution of income to the investors.

Most Syndications do not have a termination date and will continue until a majority of investors vote in favour of winding them up. Investors can expect to have their money in the scheme for 5 – 10 years, unless they decide to sell their interest through the secondary market.

Potential investors should seek independent, competent advice about this type of investment product if they are not familiar with the various factors that can affect a commercial property's income stream and capital value.

 
The process of property syndication

Offers may only be open to wholesale investors and those qualifying as eligible investors under the FMCA2013.

A wholesale investor is an investing entity who meets one of the requirements below:

  • Investing a minimum of $750,000
  • Has net assets of at least $5m
  • A professional investment business
  • Invested at least $1m in financial products (excluding category 2 e.g. retirement products) in the last two years 

An eligible investor must self-declare their previous investment experience and provide independent verification from their accountant, lawyer or authorised financial advisor. The offeror must then satisfy themselves that this experience qualifies the investor as eligible to invest in this product.

Property syndication wholesale investors

Latest news

23 Mar 2021

Compelling investment opportunity available with new Oyster Large Format Retail Fund

A compelling opportunity for investors to enter a newly established Large Format Retail Fund is being offered by leading property and fund manager Oyster Property Group.
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14 Dec 2020

Jasper’s new industrial fund fully subscribed with a $15.2m equity raise

A new industrial property investment fund from proptech company Jasper has been oversubscribed with $15.2 million in new investor equity raised.
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Latest research

2 Feb 2021

Colliers Essentials | Wellington Industrial Report | First Half 2021

Vacancy rates increased from record lows over 2020 rising to 2.4% from the 2019 total of 0.9%. Despite the easing in conditions, vacancy continues to sit well below the 10-year average of 4.4%. Any further increases in vacancy, if any, are likely to be minimal given the rebound in tenant demand apparent over the second half of 2020.
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15 Dec 2020

New Zealand Industrial 2020 Review and 2021 Forecast

While the COVID-19 pandemic has caused disruption across New Zealand, the impact on the industrial property sector has been mitigated by a number of factors. Many manufacturing companies were classified as essential services and therefore permitted to continue to trade, during level three lockdowns, while demand for services such as storage and distribution increased.
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Case studies


C:Drive

Syndication of Auckland’s award-winning C:Drive tech hub

Offeror: Oyster

Property: Institutional-grade office investment property on 2.1 hectares of land leased to ASB Bank on a 9 year lease

Address: 33 Corinthian Drive, Albany

Capital Raise: $29,250,000

Minimum investment: $50,000 minimum investment, 585 interests available

Forecast pre-tax cash return: 6.5% per annum

Outcome: Fully subscribed in just over two weeks

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Halls Portfolio
Proportionate ownership scheme of two substantial industrial facilities on long term leases

Offeror: Silverfin

Property: Over 3 hectares of industrial property on long term leases of 12 and 15 years to national tenant Hall’s Transport

Capital Raise: $30,400,000

Minimum investment: $50,000 minimum investment, 334 investment parcels

Forecast pre-tax cash return: 8% per annum

Outcome: Fully subscribed in three weeks

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Managed investment of a property portfolio on long term lease to Inghams Poultry

Offeror: Silverfin

Property: Portfolio of six properties in the Waikato with a combined land area of 186ha

Capital Raise: $46,600,000

Minimum investment: $50,000 minimum investment, 932 investment parcels

Forecast pre-tax cash return: 8.25% per annum

Outcome: Fully subscribed in three weeks

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