Fortius Joins Growthpoint Properties Australia
Leading family-owned private real estate funds management business, Fortius Funds Management (Fortius), announced today that it has been acquired by Growthpoint Properties Australia (ASX: GOZ) (Growthpoint).
The transaction with Growthpoint follows a strategic review of the business and search by Fortius to identify a partner that would complement and assist Fortius to implement its strategies and deliver on the ever-expanding needs of its investors.
Commenting on the transaction, Founder and Executive Director Ray Sproats, said “Joining with Growthpoint is an ideal outcome for Fortius and our stakeholders as it provides the best path to grow with our investors’ aspirations as well as provide opportunities for our talented investment team. We are enthused by the complementary fit of an active funds manager with a leading office and industrial REIT.
“We are very proud of the returns we have delivered to our investors over the past 30 years. We realise to be relevant over the next 30 years we needed a complementary partner who shared our philosophy, recognised our capabilities, valued our team and could support us with a greater balance sheet through co-investment.
“This transaction will allow us to continue to grow Fortius with our investor base and pursue opportunities with a partner that is aligned with our investment philosophy and, most importantly, is the right cultural fit. The Fortius team and I are excited by the capital support for growth initiatives as well as the continuation of services for our investors. I can think of no better way to build on our 30 years of successful investing”.
As part of the transaction, Ray Sproats will step down from the Board of Fortius, but will continue with the business as Senior Advisor for at least the next two years. Fortius independent Chairman Edwin Zemancheff and independent Non-Executive Director Katherine Allchin will remain on the Board, as will Sam Sproats and a Growthpoint appointee.
Sam Sproats will join Growthpoint’s executive management team as an Executive Director – Funds Management and will continue to lead the funds management team.
Fortius brings $1.9 billion third party funds under management to Growthpoint, with exposure to office, retail and mixed use and debt investments, complementing Growthpoint’s $5.3 billion office and industrial property portfolio1. Post transaction, Growthpoint will have total assets under management of $7.2 billion.
Sam Sproats said “Fortius was attracted to Growthpoint because it understood the value-add and opportunistic nature of the Fortius funds management business and recognised the quality of the experienced investment team that has driven performance to date.
“Both businesses are highly complementary and we are delighted that Growthpoint shares our long-term strategic objectives. Together we can continue to deliver strong investment performance for our investors.
“Importantly, funds will be managed by the existing team and there are no proposed changes to the business model, investments and strategies or how we serve our clients”.
Timothy Collyer, Managing Director of Growthpoint, said, “We are pleased to announce the acquisition of Fortius today and the establishment of a funds management business which has been a key strategic priority for Growthpoint. Fortius is a best-in-class fund manager with an over 30 year track record of generating average IRRs of 17%2 for its investors. We intend to grow the funds management business, delivering incremental growth to earnings and income stream diversification for our securityholders. We look forward to Fortius joining Growthpoint and continuing to deliver great outcomes to its institutional, high net worth and wholesale investors”.
The transaction is expected to complete in 1Q FY2023.
Fortius Funds Management appointed BG Capital Corporation Pty Ltd as financial advisor to the Transactions and Minter Ellison as legal advisor.
For further information contact:
+61 418 708 663
- Growthpoint ASX announcement published 3 August 2022 ‘Acquisition of Fortius Funds Management’. $5.3 billion includes unaudited valuations as at 30 June 2022 and 165-19 Thomas Street, Dandenong, Victoria which settled in July 2022.
- Fortius average IRR calculated as a weighted average of all past Wholesale Funds and Syndicates held for more than 24 months, together estimated IRR’s for SMA assets
Fortius is a private Australian Funds Management group with a proven track record in property funds management. Our approach to real estate investment is driven by a greater understanding of the fundamentals and dynamics of real estate markets, and the ability to identify the potential of individual assets. We have been investing in Australian commercial real estate for close to 30 years. In this time we have built an institutional grade investment processes, systems integration and a competitive edge in investment execution. For more information visit fortius.com.au.
Growthpoint Properties Australia (ASX: GOZ) provides space for you and your business to thrive. For more than 12 years, we’ve been investing in high-quality industrial and office properties across Australia. Today, we own and manage 59 properties, valued at approximately $5.3 billion. We actively manage our portfolio. We invest in our existing properties, ensuring they meet our tenants’ needs now and into the future. We are also focused on growing our property portfolio. We are committed to operating in a sustainable way and reducing our impact on the environment. We are targeting net zero by 2025. Growthpoint is a real estate investment trust (REIT), listed on the ASX, and is part of the S&P/ASX 200. Moody’s has issued us with an investment-grade rating of Baa2 for domestic senior secured debt.