From east to west for Pindan Capital

Pindan Capital is banking on its east coast expansion to bring investment back to Western Australia, following the purchase of two Sydney development sites.

The fund manager and property syndicator recently closed two off-market transactions to add to its Sydney portfolio.

At Turramurra on Sydney’s north shore, Pindan Capital paid $14.2 million for a development site already approved for a 52-unit complex, located 150 metres from the suburb’s train station and town centre.

The other acquisition was the $13.3 million purchase of a commercial office building in Crows Nest, which has been leased back to the vendor, Warner Music, for a five-year term.

Pindan Capital general manager Scott Staniforth said both deals were brokered off-market, which presented an opportunity to negotiate good prices.

The fund manager entered the Sydney market in February last year, focusing on boutique apartment developments pitched to be sold to local investors or owner occupiers.

A construction start is imminent on Pindan Capital’s first Sydney project, Eden Lane, where is will develop a 36-apartment complex.

Nearly all of the apartments have been sold, with just four remaining on the market.

Mr Staniforth said the biggest challenge for Pindan Capital had been not overpaying for sites in a heated NSW property market.

“We were happy to sit and wait, but we have found projects in that process,” he said.

Mr Staniforth said Pindan Capital was keen to replicate its success at its first investment in South Brisbane, an apartment project joint venture with superannuation fund HostPlus and Singaporean development group Roxy-Pacific Holdings.

That project, New World Towers, will comprise 431 apartments and has a three-year completion date.

HostPlus and Roxy-Pacific subsequently signed Pindan Capital as its development manager for a 4.4-hectare former industrial site in North Fremantle, which was acquired for $59 million in April last year.

“Both of those investors weren’t really looking at WA, but through the process they saw the North Fremantle site and saw a good investment opportunity, which is exactly what we wanted to be able to do,” Mr Staniforth said.

“Pindan’s model of building partnerships means we are doing more than one project with our respective clients.”

The east coast focus is also a key plank of Pindan Capital’s strategy of building a diversified portfolio for its investors, Mr Staniforth said.

“Every market in Australia is different, every capital city at the moment is going through different stages, so to have access to those markets helps our investors and obviously helps the group,” he said.

“You try and buy at the right times in the cycles and the like, so we have to be careful, especially in east coast markets, which are getting to the top or have just passed the top.

“But there is still good buying there, as there is in WA, where the cycle is towards the bottom.

“Having the ability to play in all of the markets is very beneficial to the group.”