MRDG, a Melbourne-headquartered social infrastructure and healthcare facility property developer, could consider its first equity investment to accelerate growth, said Head of Capital and Investor Relations, Jake Ireland.
In the event of a deal, the company would be flexible around deal structure but, it is unlikely that the current sole owner David Rennex, who founded the firm in 2021, would relinquish a controlling stake, Ireland told Mergermarket after July’s Wholesale Investor event in Sydney.
The company is ready to start engaging with potential investors and welcomes approaches from wholesale investors interested in healthcare such as medical professionals, high net-worth investors, financial advisors with high-net-worth clients, and accountants that look after Self-Managed Super Funds (SMSFs), Ireland said.
MRDG will handle any investment discussions on its own but could bring in external corporate advisors if it decides to pursue a large capital raise, Ireland said. Having completed several individual projects, MRDG is now raising its first healthcare funds, which are being set up as special purpose vehicles (SPVs), Ireland said.
The company is raising for its AUD 29m (USD 20m) Moorabbin - MRDG Healthcare Fund 1, which is expected to start the construction of a state-of-the-art medical centre in Moorabbin in Victoria in 2026, he said. It has raised AUD 4.2m in equity so far and is seeking another AUD 10m in equity, with the rest of the fund to comprise private debt or credit.
MRDG already has a Singapore-based family office as an investor in MRDG Healthcare Fund 1 and welcomes approaches from other investors in Singapore, Ireland noted. It's targeting equity growth of 37.07%, and 8% pa targeted distribution, he added.
MRDG will start raising for its AUD 100m Chadstone - MRDG Healthcare Fund 2 in 2025, Ireland said. It is already talking to a family office interested in becoming a cornerstone investor, he said, noting that the fund will comprise AUD 30m in equity investments, with the rest coming from private debt or credit.
MRDG envisages exits for these funds to be via sales to family offices or property groups with healthcare funds once the projects have been in operation for a year, but would consider earlier exits that still provide a 37% return, Ireland said.
Other Australian property groups with healthcare funds include financial and wellbeing group Australian Unity, real estate investment trust Dexus [ASX:DXS], and Sydney-based Barwon Investment Partners, Ireland noted.
Although there is significant and increasing demand for social infrastructure and health facilities, there are not many single-asset healthcare property funds in Australia, MRDG is positioning to establish a brand in this space, Ireland said.
The company, which specialises in developments involving medical and healthcare-related centres, specialist disability accommodation, National Disability Insurance Scheme (NDIS) supported housing and social housing, is currently focused on developments in Melbourne and regional Victoria, he said.
by Louise Weihart in Sydney
Published by Mergermarket (an ION group company)
