MaxCap and Troon forging a long-term partnership
Successful milestones reached on two key Projects
7 July 2020, Melbourne – MaxCap Group, one of Australia’s leading real estate debt and investment houses, today confirmed it has forged successful joint venture partnerships with Troon Group, a highly respected developer and off-shoot of the 150 year old Victorian builder H.Troon. The two groups have been collaborating for some time and have recently completed their first development together and commenced construction on their second.
The partnership between the groups has seen the recent completion of a significant value add office project in the blue-chip Melbourne suburb of Mont Albert and construction commence on the new BMW Berwick car dealership in the south east. Both projects were being delivered by Troon Group’s construction arm, H.Troon.
Simon Hulett, MaxCap’s head of direct investment, and Tom McInerney, Troon Group’s managing director, said they were both delighted to have been able to form the partnership.
“We are exceptionally proud of our relationship with Troon Group and the results this will deliver to investors. Tom and his team have a unique ability to identify opportunities through their extensive networks across the country and equally strong reputation. This was evidenced with Mont Albert and BMW Berwick – both deals that were sourced off market. Combined with their execution and delivery capability, Troon is a great partner for our Direct Investment business” Mr Hulett said. “Our approach is to establish long term relationships with a select group of leading developers, those that are both well established and those that are on the way up. We can grow with our partners and tailor joint venture capital solutions to their needs to ensure they can successfully deliver outstanding development product across all real estate sectors.”
Mr McInerney said Troon Group had first worked with MaxCap on a debt funding opportunity for the construction and development of the Mentone Centre (Melbourne, Victoria) in 2014.
“Having worked with MaxCap for a number of years now, they understand our business which allows our team to really focus on what we are good at and trust that we will have the capital support we need from MaxCap to execute. Working together as joint venture partners on the BMW Berwick and Mont Albert projects – and with more to come – we enjoy a number of synergies with MaxCap,” said Mr McInerney. “Troon Group is a delivery focused developer with unique whole of Development capabilities forged from 150 years and 6 generations of H.Troon history.”
Mr McInerney emphasised that he saw diversification across various asset classes as bringing resilience to the Troon Group in a post COVID environment. Mr Hulett added this was similar to MaxCap’s diversification of its core debt-funding business over recent years to now include joint venture capital funding through the more recently established direct investment business, allowing MaxCap to provide funding solutions across the full capital stack.
Hamilton Street Mont Albert Project
In less than 12 months, MaxCap and Troon Group acquired, extensively refurbished and re-leased the suburban office building that had stood vacant for more than ten years. The building is well located in Mont Albert, in Melbourne’s Inner East.
The scope of the upgrade included 3,700 sqm of office space over three levels, with 114 basement car parks and new end of trip facilities. Leasing interest was strong from the outset, with 92% of the building pre-leased to Telstra Business Centre and Laing O’Rourke prior to the commencement of construction works.
Located on Hamilton Street, the main commercial and neighbourhood strip of Mont Albert, the building is less than 100 metres from Mont Albert train station, which provides easy access to Box Hill (a Major Activity Centre under Plan Melbourne) and the Melbourne CBD.
“After a decade of sitting empty and derelict, we saw the opportunity to redevelop the building and revitalise the Hamilton Street precinct,” said Mr McInerney said. “That has occurred quicker than expected with pre-leases secured shortly after settlement and construction now completed on time and budget.
Mr Hulett added, “The blue-chip suburban location was supported by the fact that the Inner East suburban office market has been experiencing historic low vacancy rates driven by strong tenant demand and a very limited supply pipeline. In the post COVID environment, we expect to see demand for decentralised workplaces grow and locations such as this thrive.”
MaxCap and Troon have also recently commenced construction on the development of a purpose-built BMW car dealership with Jowett Motor Group (JMG) in Melbourne’s south eastern growth corridor. The site is located on Coventry Road, Narre Warren and will have a built area of close to 3,000sqm.
“Construction commenced in May and is on track for completion and handover for November 2020,” Mr McInerney said. “We are very excited to be working with Jowett Motor Group and a leading luxury car manufacturer like BMW.”