Thu, 09 Aug 2018, The Australian Financial Review
Brisbane-based Aurora Assets Management Group has acquired the management rights to two Sydney apartment projects being developed by ASX-listed Abacus Property Group in the first deals of their kind in NSW for almost a decade.
Management rights, which allow operators to earn income from caretaking, maintenance and letting services, have traditionally been mostly prevalent in Queensland developments with NSW and Victorian developers preferring to appoint in-house facility managers.
However, that is changing with Aurora – led by Wei Yan and Jian Xiong – expanding its portfolio of 13 Queensland towers with more than 3000 apartments into both NSW and Victoria.
The pair have acquired the off-the-plan management rights to 175-unit One A at Erskineville and 100-unit Ashfield Central for $2.2 million, both of which are being developed by Abacus.
Aurora has also acquired the rights to Melbourne developer Kokoda's 320-unit twin tower Chester and Ella development in Brisbane for $4.6 million and recently purchased rights to another Newstead apartment project, 220-unit Haven by HCAP Developments, for $3.14 million.
"It was a natural progression for us to expand our portfolio into NSW and Victoria with the acquisition of One A and Ashfield Central creating a strong foundation to support our company's growth strategy," the joint Aurora directors said.
'Benefits for all stakeholders'
All four deals were negotiated by management rights specialist Tim Crooks of Resort Brokers, who said they underlined the strength of the new residential management rights market despite reports of an investment apartment oversupply.
"Publicity a long time ago about a small number of disputes between managers and owners' corporations, plus the influence of real estate agents with vested interests in property management, put a dampener on the industry in the Sydney market," he said.
"But developers have again realised the benefits for all stakeholders that flow when management rights are incorporated in new residential developments, and these are the first two of many more we expect will follow."
Last month, Financial Review Rich Lister Paul Little put the management rights to a Gold Coast high-rise development up for sale asking $15 million.