AUSTRALIA - ING Real Estate Investment Management has taken another step in its phased withdrawal from the Australian property funds sector by relinquishing its role as manager of an office fund.
The real estate investment manager, which is undergoing a merger with CBRE Investors, has entered into contracts to transfer the management of the ING Office Fund (IOF) to Investa Property Group. Investa will also acquire ING Group's 2.5% stake in the fund.
The move comes soon after revelations that ING REIM is to offload its Australian industrial fund to a group of investors led by Goodman Industrial Funds Management.
The transaction will result in a transitional management arrangement where ING Management Limited (IML) will remain as the responsible entity of the fund, while Investa will assume the day-to-day management, replacing ING Real Estate Investment Management Australia (REIMA) as the manager of the fund.
It is intended that in the future Investa will either purchase IML or seek unit holder consent to replace IML with an Investa responsible entity.
Several ING REIMA employees, led by Tino Tanfara, will join Investa, and the ING Office Fund will be renamed Investa Office Fund.
Denis Hickey, chief executive at ING REIMA, said: "Investa is a highly capable office manager with extensive experience in the sector and has a large, well resourced, integrated platform.
"This framework, along with the retention of key members of the IOF management team, will ensure IOF unit holders continue to receive high-quality management at both an asset and fund level."
In February 2011, ING announced it had finalised a strategic review of its Australian real estate investment management platform and its five ASX-listed real estate funds.
ING and the independent board of IML have evaluated various options for each fund, with a focus on unlocking the best value for unit holders.
Unit holders of ING Industrial Fund recently approved a proposal by Goodman Industrial Funds Management to acquire all of the units in the ING Industrial Fund via a trust scheme.
There are three other Australian real estate funds managed by ING REIM whose fates have yet to be decided: ING Entertainment Fund, ING Healthcare Fund and ING Community Living Fund.
ING REIM said significant progress had been made to determine the future ownership structure of these funds and that work was "currently being completed, including active discussions with a number of external parties".