GURNER™ raises $1.75 plus billion build to sell development fund
Multi-billion-dollar developer GURNER™ has secured a deal which is believed to be one of the largest institutional-grade capital investments into a residential developer in Australia.
The $1.75 billion fund for its Build-to-Sell (BTS) business, comes off the back of an unprecedented institutional placement of capital totalling $400 million from a global institutional investor to develop BTS across Australia.
The deal will allow the business to add an additional $1.75 billion in projects to its $10 billion pipeline of current and future projects across its BTS interests.
The institutional capital raise is a significant step forward in GURNER™ CEO Tim GURNER’s 10-year strategy to transform the company from a private Australian property business into an institutional grade developer, fund manager and multi-platformed lifestyle brand.
“This capital raise represents a huge milestone for our business as we continue to drive towards our goal of transforming GURNER™ Group into a fully diversified capital light developer, fund manager and lifestyle brand,” said GURNER.
“This gives us huge dry powder now in the Build to Sell sector to focus on opportunities that arise out of the market dislocation that will occur in the next 12 months, specifically in Sydney as we grow our brand there while also supporting our Melbourne and Queensland endeavours.
“We believe the timing is ideal as the cost of capital and interest rates continue to rise, alongside substantial cost hikes in the construction sector, which we expect will create a lot of opportunities for us.
With a large gap developing between the listed and private residential developers due to the large requirement for capital, GURNER™has filled that void picking up a number of large mixed use sites off market.
“We believe the next six to 18 months will be critical as many developers may struggle to hold onto sites due to rising construction and holding costs, which will create serious opportunities for those who have the capital to act quickly.
“With a lot of dry powder we will continue to actively but carefully pursue new sites across the eastern seaboard of Australia. We are considering a vast range of opportunities that fall anywhere within the $30 million to $200 million land bracket,” GURNER said.
The funding announcement comes off the back of the developer’s $1.2 billion Build to Rent (BTR) fund secured in 2021, in partnership with alternative real estate investment manager Qualitas for the Groups’ GQ BTR platform.
The GQ BTR platform has already secured four seed sites totalling over 1350 apartments and commenced construction on two major Build-to-Rent projects in Melbourne, with another Melbourne and Sydney site to commence construction in early 2023.
Over the past 10 years GURNER™ has evolved from an entrepreneurial brand to an institutional grade corporate business and brand with five unique business units across multiple divisions including both Build-to-Sell and Build-to-Rent property development, hospitality, wellness and operations.
The brands now operate under the umbrella of the GURNER Group parent company, which is serviced by a team of more than 90 across three offices in Melbourne, Sydney and now Brisbane, with former Southern Cross Austereo CFO Nick McKechnie recently appointed as the GURNER Group CFO.