The exit by Dutch group ING of its ING Real Estate Investment Management business took a further step forward today as the unit holders of its ASX-listed logistics real estate fund, ING Industrial Fund, approved its sale to an investment club led by Sydney-based developer and fund manager Goodman Group.
Goodman’s partners in the investment club include China Investment Corporation, Canada Pension Plan Investment Board and Netherlands-based Algemene Pensioen Groep.
ING REIM received 93 percent approval to sell the fund, which has 60 properties, 44 in Australia and 16 in Europe, for approximately A$2.5 billion (€1.76 billion; $2.46 billion) at a price of A$0.55 a share. The deal was originally agreed with ING Management Limited, the entity responsible for the fund, at the end of December. It is expected to be completed on 29 March after gaining necessary judicial and other approvals.
“This transaction is part of ING’s previously stated intention of undertaking a phased withdrawal from the Australian real estate investment management business in a timely and controlled manner,” ING REIM said in a statement.
The transaction was conducted concurrently with ING’s exit of its main ING Real Estate Investment Management business, which was sold to Richard Ellis for approximately $1 billion last month. That business will be merged with CBRE’s own investment management business, CBRE Investors which has become the world’s largest company in the sector with about A$96 billion of assets under management.
ING also said it had finalised a strategic review of its Australian REIM platform which consists of five ASX-listed funds with combined assets under management of A$4.14 billion. “ING, together with the independent board of ING Management Limited as the responsible entity for the five funds, have evaluated various options for each fund with a focus on unlocking the best value for unit holders,” ING REM said.
The funds include: the ING Office Fund, which has an office portfolio predominantly occupied by Australian government and other ‘blue chip’ occupiers and is valued at A$2.9 billion; the ING Real Estate Community Living Group, which manages A$738 million of senior housing communities in Australia, New Zealand and the US; the ING Real Estate Entertainment Fund, which has various entertainment and leisure venues in Australia and New Zealand and is valued at $323.4 million; and the ING Real Estate Healthcare Fund, Australia’s only healthcare REIT. This comprises six assets valued at A$180 million.
ING REIM said: “Significant progress has been made evaluating the alternatives to determine the future ownership structure for these funds and work is currently being completed including active discussions with a number of external parties.”