Aussie partnership 12 months in making

Tauranga-based national property funds manager PMG Property Funds Management Limited has announced a 50 per cent equity partnership with listed Australian-based investment and funds manager, 360 Capital Active REIT.

The deal is worth up to $17.5 million and PMG chairman Denis McMahon, who founded the business in 1992, says it has been a deal 12 months in the making.

“To grow the business and protect the investors from uncertain times, particularly after the global financial crisis, it really became clear to me that you have to have very robust structures around you to survive that sort of thing,” says Denis. “We did, but to take it to the next level an equity partner would have been a very useful thing to have.”

Denis says that over the years he has spoken with numerous parties regarding equity partnership, but nothing ever came to fruition. Finally, 360 Capital presented him with a chance to partner with a company who share his core values.

“When I formed the business, one of my principles was quite a simple one,” he says. “If it was good for investors then it would be good for me. The second one was to co-invest with my investors so that I had skin in the game.

“I think as we went through the journey with the guys from 360 we realised that there were a lot of similarities in terms of values.”

Whilst some may have reservations regarding the New Zealand company branching out across the Tasman, Denis is keen to point out the Kiwi link within 360 Capital, whose own managing director Tony Pitt is a New Zealander.

“If you’re wanting to be in business and expand it’s a fact of life; at some point, you're going to look to further fields,” says Denis. “Logically, Australia is in our backyard. There’s a lot of similarities there.

“The founder is a Kiwi, which is a great story in itself, and he and I shared a lot of similarities.

“We started something on our own and basically built it up over a long period of time. So I think there was a lot of synchronicity in terms of how we look at and value things. I think that was important.”

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