Investa captures A$110m for Australia core fund

The Sydney-based real estate fund manager has raised a second tranche of equity for its Investa Commercial Property Fund which will be used to acquire interests in two Australian office buildings.

Investa Property Group has raised A$110 million (€84.4 million; $109.7 million) from institutional investors for its Investa Commercial Property Fund.

The Sydney-based property fund manager, acquired in 2007 by Morgan Stanley Real Estate Investing, announced today it had consequently brought its capital raising for the core office fund to A$175 million during 2011 and A$470 million over the past two years.

The capital has already been earmarked for the acquisition of interests in two office buildings – a 50 percent position in 120 Collins Street in Melbourne and a 5 percent stake in 400 George Street in Sydney.

“A number of factors underpinned the success of the capital raising, including the quality of the acquisitions, the alignment with fund strategy and the strong outlook for Australian office markets. Investa’s significant office operation operating platform was also a key investment consideration,” the firm said in the announcement.

Campbell Hanan, head of Investa Office, said: “On a risk adjusted basis the investment case for Australian prime office remains very compelling –rents are rising, supply is low, demand is resilient and our portfolio is well occupied. These strong fundamentals underpinned the raising despite the uncertainty in the financial markets.”

Investa, which manages both listed and unlisted funds, has assets under management valued at more than A$9 billion and capital under management of approximately A$4.2 billion. Offices make up the majority of its assets, comprising more than 50 buildings valued at more than A$7.5 billion.