Investec Australia Property Fund CEO Graeme Katz. Picture: SUPPLIED
Investec Australia Property Fund CEO Graeme Katz. Picture: SUPPLIED

Investec Property plans to raise about R1bn by selling 76.9-million new units in its Australian fund as part of its plans to seek a primary listing for that fund on the Australian Securities Exchange (ASX).

Investec Property, which manages about R35bn in real estate assets, acts as an external manager for the Investec Property Fund and the Investec Australia Property Fund, which listed on the JSE in 2013.

The company planned to lodge a “product disclosure statement” regarding the unit offering with the Australian Securities and Investment Commission “shortly”, Investec Australia Property Fund said on Friday.

The new units would start trading on the ASX at the end of May. At the same time, the fund’s secondary listing in Bermuda would be terminated, meaning Investec Australia Property Fund would be “dual primary listed” on the JSE and ASX, it said.

Units would be offered to retail investors in Australia and New Zealand, and to certain institutions in SA, Australia, New Zealand, Hong Kong and Singapore.

The final subscription price was expected to be between A$1.30 and A$1.35. About A$100m (R1bn) was expected to be raised and the proceeds would be used to repay debt and pay the costs associated with the offer.

Investec Australia Property Fund had net assets worth A$621.5m at the end of March, it said in a separate disclosure on Friday. That equates to a net asset value of A$1.30 per unit.

The group’s investment properties – mainly office and industrial assets in Australia and New Zealand – were valued at A$1.1bn at the end of March.

The fund’s distributions to unitholders for the year to end-March grew 2% to 10.23c before withholding taxes, or 1.2% to 9.40c after subtracting withholding taxes, it said.

JSE-listed Investec Property Fund said in a separate statement it had agreed to sell up to 45-million of the Investec Australia Property Fund units it owns to institutional investors if the fund’s ASX offering was oversubscribed.

“The fund is supportive of the sale as a means of reducing Investec Australia Property Fund’s register concentration in order to facilitate broader investor engagement in Australia and improving aftermarket liquidity in [its] units.”

Even if all 45-million units were transferred to other institutions, Investec Property Fund would still retain an about 10% stake in Investec Australia Property Fund, it said.

Meanwhile, Investec Property Fund said in a separate statement on Friday it was co-investing in a “pan-European light industrial property platform”.

It had committed a total of €64.5m (R1bn) for a 42.9% stake in Luxco, an “unlisted portfolio and pipeline of properties” in France, Germany and the Netherlands.

“The potential portfolio is expected to comprise 21 properties, of which four assets located in the Netherlands have already been acquired,” Investec Property Fund said.

The gross asset value of the “potential portfolio”, which was 90% let, was expected to be €116m.

The investment was expected to generate total returns “that significantly exceed the fund’s cost of capital”.

“The transaction is complementary to the fund’s existing investment into the Pan-European logistics platform that was concluded during 2018,” Investec Property Fund said.

The deal would “enhance the fund’s presence in a very strong segment of the real estate market across Europe”.

“The strategy will look to benefit from growth of e-commerce across Europe and its expected impact on last mile logistics.”

hedleyn@businesslive.co.za