Peet raises $300m for Alkimos land acquisition

Property group Peet Ltd has announced the successful launch of its wholesale funds management business with the completion of a $300 million wholesale land syndicate for Alkimos, 40 kilometres north of Perth.

The Peet Wholesale Land Syndicate was established to acquire and develop a 243 hectare residential zoned property with 1.7 kilometres of ocean frontage within the Alkimos Eglinton project, a planned growth area in Perth's northern coastal metropolitan corridor.

The majority of the syndicate capital raising has been subscribed for by institutional investors including cornerstone investors MTAA Super and The Myer Family Company Pty Ltd, with Peet Ltd taking a 10 per cent interest in the syndicate

Peet Ltd managing director Brendan Gore said diversifying its capital sources to include institutional investors would allow Peet to further leverage its business model and participate in a larger and more diverse range of opportunities.

He said there would be opportunities for Peet's syndicate investors to participate in the project through a Peet Alkimos syndicate to be launched later in the financial year.

"We believe the site represents what may be the last opportunity to acquire a significant coastal parcel of land between Yanchep and Mandurah," Mr Gore commented.

Based on current estimates, the project is expected to have a duration of 12 years and yield some 2,800 lots and total land sales revenue of approximately $1.4 billion.

The purchase is timely given plans to open up Perth's northern corridor even further with the current extension of Marmion Avenue though the property, and beyond to Yanchep, expected to be completed by August 2008.

"This really is a unique coastal property acquisition - arguably the only opportunity for a new major coastal residential estate within 40 kilometres of a capital city in Australia," Mr Gore said.

Peet Ltd, will act as development and marketing manager for the project, which is north of its existing Burns Beach Estate.

Commenting on the MTAA decision to invest in the Alkimos project, fund principal executive officer Michael Delaney said it was attracted to the opportunity because of its location, planning and potential returns to its members.

"The fund has been actively seeking quality opportunities to invest in Western Australian property and the opportunity to participate in a project with a group having the experience and reputation of Peet Limited is consistent with the investment philosophy of the fund and continues the diversification of the fund's property portfolio."

Mr Gore said establishing the Peet Wholesale Land Syndicate, and an institutional distribution capability, had been a key strategic goal for the company over the past 12 months.

Peet Ltd has the third largest land bank of any ASX listed property group and the Alkimos land acquisition brings its land bank to around 38,000 lots with an estimated on-completion value in excess of $7.6 billion (if sold at today's prices).