Quintessential Equity targets property acquisitions after completing $145 million capital raise
22 November 2019
Quintessential Equity is set for an active 2020 in the commercial property market, after completing a successful round of capital raising for the Quintessential Equity Master Fund No.2 of more than $145 million.
Factoring in leverage, the diversified commercial property group will target purchasing opportunities around the country with a buying firepower of around $250 million.
The raising was completed in just two months, the fast turnaround being a sign of confidence from investors in a fund which projected to provide a net internal rate of return of no less than 8%
The group raised $113 million in April 2018 in its inaugural Master Fund and subsequently acquired office assets at 431 King William Street, Adelaide and 8 St Georges Terrace, Perth, as well as a large industrial property in South Australia.
Harry Rosenberg, Director at Quintessential Equity, says the group will continue to use both micro and macro indicators to find opportunities around the country where they can add value.
“We have a strong track record founded on our core fundamentals, being patient and only acquiring properties that meet our strict buying criteria.” he said.
“We will continue to look for opportunities where we think a property has reached the bottom of a value cycle that looks set to turn.”
Quintessential Equity’s Executive Chairman, Shane Quinn, believes the more cautious, risk adverse approach from banks to lending means being ‘capital ready’ is vital to success.
“Being capital ready allows you to be counter cyclical, so that when assets with inherent value become available you can proceed to purchase them without needing credit from banks, then reposition them to extract long-term secure income,” he said.
“I think it will be very important over the next 24 months while vendors are under pressure to drop their loan to value ratios (LVRs) and meet banking interest coverage ratio (ICR) covenants.”
Quintessential Equity has delivered a weighted average net internal rate of return of 22.2% (as at 30 June 2019) since commencing in July 2010.