Investa Property Group has raised around $602 million for the Investa Commercial Property Fund, its flagship wholesale property fund.
In a statement announcing the capital raise, the Sydney-based property company said its fund management entity Investa Office Management Holdings has raised A$600 million ($452 million; €409 million) in equity and $150 million in debt through its first US private placement issuance.
Investa acquired the fund management platform from Morgan Stanley for A$90 million in February this year, giving it the right to manage the ICPF, in the middle of an extended period of uncertainty as Morgan Stanley gradually exited the business.
“We are delighted with the significant recent equity commitments by investors,” said Jason Leong, fund manager of ICPF. “It repositions the balance sheet following a series of quality acquisitions in a very tight market, ensuring ICPF is well placed to fund the redevelopment of 60 Martin Place.”
The statement further added that the firm has acquired office buildings totaling around A$750 million via the ICPF in the last 18 months. These include a 75 percent interest in 420 George Street, completion of a full stake in 1 Market Street, and a 50 percent interest in 60 Martin Place. All these assets are located in Sydney.
In recent years, ICPF has built up a strong track record of managing its capital position effectively by utilising its balance sheet capacity and attracting ongoing support from a list of blue chip institutional investors. This support has continued following the recent change in ownership of the Investa office management platform and is evidence of the ongoing demand for quality real estate and sector specialisation offered by Investa,” said Peter Menegazzo, the firm’s chief investment officer.
ICPF currently has an office portfolio totaling A$4.1 billion. According to earlier PERE reports, the fund has returned 12.3 percent over two years and 10.1 percent over five years, outperforming the Mercer-IPD Australia Unlisted Wholesale Property Fund Index, the country’s benchmark index.