New Star International Property Fund, a $1.27 billion (€838.4 million) global vehicle managed by UK-based New Star Asset Management, has acquired three properties in Asia Pacific.
The first property is located in Melbourne at 414 La Trobe Street. The building has 17 stories including three levels of above-ground tenant parking. The property has a net lettable area of 14,229 square meters and was purchased for AU$67.1 million ($62.2 million, €40.8 million). It is already fully let.
The second property, Alinta Plaza, was purchased for AU$63.5 million ($58.9 million, €38.7 million) and is located in Perth, comprising seven floors and four car parking levels. The plaza is built on a net lettable area of 7,800 square meters. The building underwent extensive redevelopment works in 2005, and it has a 100 percent committed occupancy. The anchor tenant is Alinta Ltd, which occupies 92 percent of the net lettable area and has a lease that provides for annual fixed increases in rent up to 2017.
The third property is in Singapore, located at 1 Phillip Street, and was purchased for S$99 million ($71.2 million, €46.7 million). It is a 16 story office building and includes a small retail outlet on the ground floor. The property, built in 1993, has a net lettable area of 36,194 square feet and is located in the heart of Singapore’s Raffles Place office district.
The New Star International Property Fund is currently 85 percent invested in the Asia Pacific region and 15 percent invested in Continental Europe. According to the firm, it has returned 4.1 percent, relative to a 6.1 percent decline for the IMA specialist sector, since the fund launched on June 4, 2007.
“The early focus of the fund has been towards prime Asian markets that have thrived,” said Stuart Webster, head of global property for the firm. “Since the launch of the fund, European markets have experienced a readjustment in price – in light of credit concerns – and we prudently minimized our early exposure to this area. I expect some further weakening in Europe and, as a non-leveraged, cash-rich buyer, the fund is in a strong position to purchase prime assets at increasingly attractive valuations in this market in due course.”
New Star’s International Property Fund invests in commercial properties outside the UK, with a focus on Western Europe, Central Europe, Japan and the rest of Asia. The fund is managed by a global property team headed by Roger Dossett. The team also manages the £2.07 billion New Star UK Property Unit Trust, which invests in UK commercial property.