Uncertainty reigns for Investa Commercial Property Fund

The $3 billion Investa Commercial Property Fund is expected to win more time to progress a plan to internalise, leaving the future of one of the country’s top office landlords in limbo.

Unitholders in the wholesale trust are backing the internalisation plan and meetings were being held late Wednesday, while hopes of a speedy resolution with Mirvac Group, that has sought to acquire the fund’s management, appear to be fading.

Mirvac was neither rejected nor dismissed by ICPF’s unit holders, sources say. However, the influential coterie of superannuation funds supported the plan which would see them buy the trust’s management.

The fund is yet to receive a green light from Morgan Stanley Real Estate Investing, which is selling the Investa Property Group real estate empire it bought prior to the global financial crisis for $6.6 billion.

The real estate house, advised by Morgan Stanley and UBS, had hoped to fully exit by the end of the year but the time frame may be in doubt.

ICPF’s independent directors last month called in Grant Samuel to provide counsel on a move that could see it acquire the $8.9 billion Investa Office platform. ICPF’s $3 billion portfolio includes coveted office assets, including a stake in Sydney’s Deutsche Bank Place.

The moves mean that Mirvac’s $400 million-plus bid for the platform, that includes the management of the listed Investa Office Fund, and the running of a portfolio of towers sold to Chinese sovereign wealth fund China Investment Corporation for $2.45 billion, will remain on the sidelines, at least until it receives the support of ICPF unit holders.

Mirvac’s grasp over the listed fund IOF has already slipped after the independent board committee, aided by Fort Street Advisors and Macquarie Capital, launched a strategic review of the business last month, opening up the possibility of a takeover.

The Australian has revealed rivals Cromwell Property Group and Charter Hall Group are circling IOF, though a buyout of that vehicle would require the backing of capital partners.

Fund managers are keen for that fund to internalise and remain listed.

“The management team have done a good job and have rightfully won a lot of respect and credibility from the market,” Antares Equities investment manager Brett McNeill says.

This article originally appeared on www.theaustralian.com.au/property.