Hodge family sell out for about $25m

By ANNE GIBSON

Urbus Properties founders the Hodge family have sold the management rights to their property empire, netting what some analysts suggest could be about $25 million cash.

Wellington brothers Brendon and Shayne Hodge yesterday announced the conditional sale of management services for the $119 million Urbus fund, which sprang out of the former Waltus Investments.

"The sale will bring to an end the Hodge family's involvement in the management of Urbus Properties," said Brendon Hodge.

The fund was started 18 years ago by his father, John, who had a compelling vision "to provide all investors with an opportunity to invest in commercial property".

ING bought the management rights for a secret sum but some analysts predicted ING would now roll the listed Urbus business into ING's own listed entity, creating a property fund with assets of over $700 million that would be the second-largest listed real estate grouping.

But ING said the two would be kept separate in the meantime.

"The management and operations of ING Property Trust and Urbus Properties will continue to be carried out by the separate management teams, who will act autonomously and independently of each other and will report to separate boards," it said.

Property experts predict this arrangement will not hold for long and the two will soon be merged.

Although no price was put on the sale, some analysts suggested the deal would be calculated on 5 per cent of assets under management, giving a figure of about $25 million.

Few details are released when property trusts' management entities are sold, but in early 2002 it was announced that Australia's Colonial had bought the management firm of New Zealand's largest listed property outfit, Kiwi Income Property Trust, in a deal that the Overseas Investment Commission later revealed was worth $56 million.

Although the listed property entities have no obligations to pass the deals under their shareholders' or unit-holders' gaze, Kiwi details were released by the Crown-owned commission because of the size of the deal and the fact that an Australian entity was involved.

Waltus was founded in 1986 by the Hodge family.

The Wellington-based property syndicator was dogged with problems, including poor returns from many of its syndicates, unit-holder dissent and a string of court cases. Waltus eventually changed into Urbus with Murray Barclay as its chief.

The deal

* ING (NZ) has bought Urbus Property Management.

* Urbus manages listed property fund Urbus Properties, which has a market capitalisation of $119 million.

* ING (NZ) is 51 per cent owned by ING Group, 49 per cent by ANZ Bank.

* Urbus Property Management was owned by Shayne, Lyndon and Brendon Hodge.

* ING (NZ) manages listed property fund ING Property Trust through ING Property Trust Management, jointly owned with Symphony Investments.