Cromwell to wind up flagship office fund to return capital to investors
The Cromwell fund owns about $500m worth of assets, including the tower at 545 Queen St in Brisbane.
Property group Cromwell will wind up its flagship unlisted property fund for retail investors, which owns about $500m worth of assets, after they flagged that they wanted their capital back.
The fund manager conducted a liquidity event for the Cromwell Direct Property Fund in July and said withdrawal requests exceeded 50 per cent of the units on issue, which meant it was required to begin the process of realising assets, leading to an eventual wind-up.
The fund owns buildings across Australia, with a focus on Queensland assets, and has stakes in two of Cromwell’s unlisted trusts.
95 Grenfell St, Adelaide.
The directly owned assets are worth $464.95m and the fund stakes take the total portfolio to $542.12m.
The buildings are mainly in suburban markets that have shown signs of stability, giving the manager a range of options as it looks to sell down assets and return funds.
Cromwell is yet to indicate its preferred strategy or a time frame for the wind-up, but it is most likely to opt for a carve-up of the portfolio. The fund owns buildings in Brisbane including 545 Queen Street, 100 Creek St and 33 Breakfast Creek Road, as well as 420 Flinders Street in Townsville.
In NSW, it has 163-175 O’Riordan Street in Mascot and 11 Farrer Place, Queanbeyan. In Adelaide, it has 95 Grenfell Street, and in Victoria is has 19 George Street in the Melbourne suburb of Dandenong.
The disparate nature of the buildings means that selling to individual buyers would produce the highest prices.
As well as the six directly owned offices it has stakes in the Cromwell Riverpark Trust and Cromwell Property Trust 12. Cromwell said disposing of these interests would ultimately depend on when those trusts realise their assets.
The whole portfolio was revalued externally as at the end of May, resulting in a 0.9 per cent decrease from the prior valuations, on a look-through basis. Cromwell said the portfolio had positive leasing outcomes, with a current weighted average lease expiry of 3.4 years and occupancy of 96.6 per cent as at the end of June.
