Mirvac has become the second Australian property giant in a fortnight to undertake a large capital raising to shore up its balance sheet.

The listed company, led by managing director Nicholas Collishaw, said last week it had raised A$500m (£215m), comprising a A$428m (£184m) discounted and underwritten share offer, and a A$72m (£31m) institutional placement.

The equity raising was part of Mirvac’s wider capital-management initiative.

This is aimed at paying back debt, reducing Mirvac’s gearing level from 32.5% to 26.6%, revising its projected earnings and providing A$1.3bn (£560m) of liquidity to satisfy its capital commitments for 2009 and 2010.

Mirvac also said it was in talks with its banks to roll over a A$1.1bn (£474m) debt facility that is due to expire in June 2009.

Collishaw said: ‘In these uncertain and volatile markets the board and management have determined that it is prudent to proactively undertake a number of initiatives to strengthen Mirvac's balance sheet, and position the group to flexibly respond to changing market conditions.’

Mirvac’s capital raising follows that of Goodman, which two weeks ago announced plans to rehabilitate its balance sheet after three years of international growth.

Goodman is raising A$955m (£379m) of equity by selling shares and A$510m (£202m) from selling investment properties.

Postscript

For more on the Australian slowdown, go to www.propertyweek.com/globalozwoes