The real estate fund manager is set to acquire a 50 per cent stake in real estate debt fund provider Bass Capital for $24 million.
Centuria Capital has secured a 50 per cent investment in Bass Capital, with the option to fully acquire the remaining 50 per cent interest in five years.
Centuria has described the arrangement as a 50:50 joint venture, which will expand its unlisted funds platform, while offering non-banking finance for real estate transactions including development projects, bridge finance and residual stock.
Bass Capital founders Giles Borten and Nicholas Goh will continue to lead the real estate debt team.
Jason Huljich, joint chief executive of Centuria, commented his company has partnered with Bass Capital for the last three years across lending opportunities and has “confidence in the team’s abilities and its business model”.
“Our investment in this platform is an opportunity to capitalise on strong demand from our high-net-worth investors for debt products, as they seek a diversified investment risk profile,” Mr Huljich said.
“This investment brings a new business line to Centuria, which expand our unlisted platform, diversify our recurring revenues and provide further investment opportunities to our investor clients.”
The joint venture will begin operating with a circa $270 million committed loan book, with more than $300 million in pipeline opportunities and a $107 million open-ended debt fund.
Centuria and Bass Capital expect financing demand from the non-banking financial sector will continue to grow.
Mr Borten and Mr Goh from Bass Capital have indicated plans to use Centuria’s scale and its resources.
“We will leverage Centuria’s Australasian scale, alternative real estate sectors, to grow the platform significantly,” they stated.
“To date, based upon the strength of our track record and how we have grown our investor base by word-of-mouth, we are excited to proactively deliver our debt offerings to a new group of loyal high net worth investors with the backing of Centuria.”
The deal is taking place as Centuria has made an off-market takeover of rival Primewest, with the merger to result in a real estate fund manager with $15.5 billion in assets under management.
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
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