Sunsuper was one of many investors that bought into a $500 million direct property secondaries offering from another domestic institution in the past week and a half.
The $13 billion industry fund bought a $70 million piece of the AMP Capital Shopping Centre Fund, confirmed chief investment officer David Hartley, after $230 million of capacity in the fund was offered on the secondaries market.
On Thursday May 13, the AMP Capital Investors’ flagship property fund, the $4.6 billion Australian Core Property Portfolio (ACPP), began accepting bids for about $500 million of its combined exposures to the shopping centre fund and another in-house fund, the AMP Capital Wholesale Office Fund, from current and new investors within Australia.
Sunsuper, an existing property investor with AMP Capital, moved quickly. Three business days after the secondaries offer went live, Hartley told I&T News the fund had allocated to the shopping centre fund, which holds assets such as Sydney’s Warringah Mall, Westfield Southland in Melbourne and Bayfair Shopping Centre on New Zealand’s North Island. Megan Chan, the fund’s property and infrastructure portfolio manager, performed due diligence on the product.
And the big industry fund wasn’t alone. I&T News understands that the secondary offer is close to fully subscribed.
However AustralianSuper, already an investor in the ACPP, chose not to buy exposure from the fund, primarily because it recently invested $500 million in the QIC Property Fund to specifically gain exposure to shopping centres in ‘growth corridors’ on the periphery of Sydney, Melbourne and Brisbane, Jack McGougan, head of property at the $30 billion fund, said.
The ACPP remains a “significant” investor in the $1.9 billion shooping centre fund and $2.4 billion office fund, an AMP Capital spokesperson said. Its decision to offload some of its exposure was made after improving property valuations made the assets more attractive to investors, and to achieve a better balance of its investments in predominantly Australian office, retail and industrial properties.
The spokesperson said the ACPP’s retail property investments provided the best performance during the financial crisis, while industrial properties underperformed. Occupancy rates among its retail and office properties was currently more than 98 per cent, the spokesperson added.