National real estate company The Agency Group Australia (ASX:AU1) has entered into a strategic alliance with MDC Trilogy Group to accelerate market share growth across new and complementary geographical areas. The alliance is underpinned by a services agreement where The Agency manages property management assets purchased and owned by MDC Trilogy.
MDC Trilogy’s first investment vehicle MDC Trilogy Wholesale Yield Fund I has reached financial close on its inaugural investments where it has purchased businesses with over 650 property managements across Sydney and Queensland which are now managed by The Agency.
The alliance facilitates all sales agents and team members of businesses purchased by MDC Trilogy to join The Agency. This provides a significant mechanism for market share growth.
The Agency is always looking for new and innovative ways to expand our market share and grow our agent presence,” The Agency Managing Director Geoff Lucas said.
“That’s why we’re excited to be collaborating with MDC Trilogy under a services agreement; it opens new doors to more opportunity for agents to join our business, across more markets, in more ways. It also allows continued expansion into more geographical areas across Australia in a capital efficient manner for The Agency shareholders.
“An inhibitor to agent recruitment is often an agent owning existing rent roll assets. The alliance with MDC Trilogy provides an opportunity for the agent to sell their business including rent roll assets and join The Agency as a sales agent. The business sale allows the agent to refocus on their selling strengths rather than administrative tasks that enables a focus on superior services and results to the customers.”
Mr Lucas believes that with the financial backing of MDC Trilogy there is significant opportunity for The Agency to further enhance returns on its scalable operating model.
“Across Australia, there are 3.25 million rental properties which we estimate are worth near $3 trillion dollars. This is broadly equivalent to the entire ASX listed stocks value and compared to the ASX listed funds management industry, the management of the residential rental properties has seen limited innovation over recent decades. The fragmented ownership of real estate offices across Australia means that many rent roll assets are not at sufficient scale to operate efficiently, nor can their owners appropriately invest in technology that improves the tenant and landlord experience. This is where The Agency’s operating model and national presence is advantageous, and why MDC Trilogy considered us an attractive services provider for their funds management model,” he said.
“Our partnership with MDC Trilogy is a long-term growth opportunity. These initial settlements are the first of many that we expect with MDC Trilogy, as it becomes a pillar of our broader strategy to grow our national market share through additional geographical markets and does not preclude The Agency purchasing rent roll assets directly.”
About MDC Trilogy
MDC Trilogy Group is a joint venture between Murray Darling Capital (MDC) and Trilogy Funds.
Murray Darling Capital is a corporate advisory firm and investment advisory firm. Murray Darling Capital partners maintain long standing relationships with private and institutional investors in addition to a broad array of investment advisors.
In addition to searching for investment solutions, MDC will advise clients where MDC’s capabilities can deliver debt and equity capital in addition to executing merger, privatisation, acquisitions and strategic advisory services.
Trilogy Funds is one of Australia’s leading fund managers and financiers of property-based investments who have been building wealth together with Australian investors, advisers, developers and brokers for over 24 years. Trilogy has over $1 billion in funds under management on behalf of over 5,000 active investors.
Trilogy Funds has more than 50 team members with broad experience across investment products, property acquisition, management and development, loan and portfolio management, investor relations, treasury, marketing, finance, operations and human resources.