ING REIM sells stake in Australian real estate healthcare fund to APN

ING Real Estate Investment Management (ING REIM) has agreed to sell its 60 percent interest in ING Healthcare Pty, the manager of the ING Real Estate Healthcare Fund, to APN Property Group. ING REIM declined to disclose the closing price. 

According to an announcement today by Dutch group, ING REIM, the Australian real estate investment manager APN will also purchase the 1.4 percent stake in the Fund owned by ING entities. The transaction is part of ING's plan to steadily phase out its participation in the Australian property funds management business, as well as exit the real estate investment business globally.

APN is also acquiring a further 7.5 percent interest in ING Healthcare beneficially owned by the Fund's senior management, who will continue to own a 32.5 percent interest in ING Healthcare. CEO Miles Wentworth and director of acquisitions and developments Chris Adams will continue to manage the Fund. 

“We believe that this proposal is in the best interest of unit-holders of the Fund,” said Hein Brand, newly-appointed chief executive officer of ING REIM in a statement. “This proposal is the next step as we move through our phased withdrawal from the Australian real estate investment management market.”

As part of the deal, APN will maintain the current strategic direction of the Fund and remain a pure play healthcare property specialist listed on the Australian Securities Exchange. ING Management, the responsible entity of the Fund, will be replaced by APN Funds Management. 

The ING Real Estate Healthcare Fund, Australia’s only healthcare Australian Securities Exchange-listed real estate investment trust, is a portfolio of six properties. The properties include hospitals, medical centres, rehabilitation facilities, laboratories and other purpose-built healthcare facilities. The fund partners with 94 healthcare tenants and has total of A$190 million (€143 million, $205 million) in assets under management. It has investments in Victoria and Queensland.

In February 2011, ING had finalised the strategic review of its Australian REIM platform and its five Australian Securities Exchange-listed real estate funds and implementation had commenced. On 17 March, unit holders of ING Industrial Fund approved the proposal by Goodman Industrial Funds Management as trustee of the Goodman Trust Australia to acquire all of the units in the Fund via a trust scheme. On 28 March, ING transferred management of the ING Office Fund to Investa Property Group. 

According to the Dutch firm, evaluation of alternative ownership structures for ING Entertainment Fund and ING Community Living Group is ongoing. 

The announcement of this deal immediately follows news of ING REIM selling its US-based global real estate securities business, ING Clarion Real Estate Securities, to Richard Ellis.