Arrow joins new fund

Dunedin-founded construction company Arrow International has joined Christchurch-based merchant bank Murray and Co to form a $20 million property development fund.

Arco Property Fund chairman Rob Campbell said there was a relative scarcity of development funding in New Zealand and the new property development fund would seek opportunities around New Zealand, including in the rebuilding of Christchurch.

"This is a good time to develop property projects that possess strong underlying fundamentals, built on a steady domestic economic foundation," he said in a statement.

The Arco fund, which would focus on industrial, office, retail and residential developments, opens for investment in January, seeking 25% of any capital commitment payable upfront.

There would be a geographic investment spread and no more than a third of the fund's capital would be committed to any single project.

Arco would not be exclusively focused on Christchurch's rebuilding, but being based there may provide the fund with privileged access to opportunities, Mr Campbell said.

Arco has no formal obligation to use Arrow's construction services, but Arrow will be the fund's preferred construction partner, with any work done benchmarked by an independent quantity surveyor, at or below market prices.

-simon.hartley@odt.co.nz

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