Ivanhoé Cambridge, the real estate arm of Canada’s second-largest pension fund, La Caisse de dépôt et placement du Québec, has confirmed its acquisition of a 25 percent stake in Sydney’s Liberty Place, in partnership with the Blackstone Group. This is the first direct investment made by Ivanhoé in Australia, and also represents the first core-plus investment by the New York-based private equity firm Blackstone in Asia.
In February this year, PERE had reported that Blackstone had acquired the interest in the core office property from La Salle Investment Management via a core-plus mandate for a client in a deal valued at A$240 million (€171.94 million; $181.48 million). The name of the investor wasn’t disclosed at the time.
Confirming the deal in a statement released this morning, Rita-Rose Gagne, executive vice president, growth markets for Ivanhoé Cambridge said: “We are enthusiastic about the opportunity to invest in Australian real estate. Blackstone’s strong knowledge of the Australian market and its established presence in Australia have been key to the success of this transaction.”
The deal is understood to reflect a yield of 5.6 percent.
“Liberty Place fits the core-plus strategy extremely well as a high quality, well-leased asset in a global city,” said Christopher Heady, senior managing director and head of real estate at Blackstone.
The 42-storey office tower is also the headquarters of the Australia and New Zealand Banking Group (ANZ) in Sydney. The remaining interest in the tower is owned by the unlisted GPT Wholesale Office Fund, a $4.8 billion fund launched in 2006 by the Australian property group GPT, which has a 50 percent stake in the tower, and the Australian superannuation fund-backed ISPT, which has a 25 percent stake.
Gagne also said that Ivanhoé Cambridge is exploring the possibility of increasing its investments in Australia and other parts of the Asia-Pacific region in 2015.
In October last year, the firm also announced its first direct investment in Mexico, by entering into a $500 million joint venture partnership with Denver-based private equity real estate firm called the Black Creek Group. The partnership was set up to invest in property assets in the US and Mexico.
As of December 2014, Ivanhoé Cambridge had C$42 billion (€31.57 billion; $33.33 billion) in assets in management.