Return to search

Australia’s Future Fund bags £200m Bullring stake

The government managed investment fund has purchased a 33 percent stake in the Bullring Shopping Centre in Birmingham, England as it seeks to invest outside Australia in assets that will help it meet pension liabilities.

Future Fund, the Australian government managed investment fund, has purchased a 33 percent stake in the Bullring Shopping Centre in Birmingham, England, for approximately £200 million ($323 million; €220 million).

The fund, which was set up in 2006 to strengthen the Australian government’s long-term financial position by investing in assets to offset its public sector superannuation liabilities, purchased the stake from UK REIT Land Securities.

Land Securities placed the stake on the market in April 2008 after developing the 1.2 million square foot shopping centre alongside Birmingham Alliance, fellow UK REIT Hammerson and fund manager Henderson Global Investors.

Bruce Nutman, head of retail capital markets at Richard Ellis, the broker which advised Australia’s Future Fund, said: “This sale is a strong indicator of investor confidence in the prime shopping centre investment market in the UK.  The Bullring is a modern, world class retail destination and the purchase reflects a net return of circa 7 percent.”

The Future Fund had A$61.04 billion ($52.6 billion; €35 billion) of assets as of 30 June of which A$757 million, or 1.4 percent, were real estate investments.