AMP Capital has acquired an additional 30% stake in the Auckland South Corrections Facility (ASCF) from UK-based developer John Laing for an undisclosed price.
The purchase will give AMP Capital a total of 70% of the 960-bed facility, which, according to industry sources, is valued at “at upwards of NZ$1bn” (€560m).
John Liang was part of a consortium, known as SecureFuture, which carried out the ASCF public partnership project (PPP) for the New Zealand government under a 25-year contract due to expire in 2040.
In December 2019, AMP Capital bought a 40% stake in ASCF from InfraRed, another foundation investor in the SecureFuture consortium. The price purchase was also not disclosed.
Two AMP Capital funds - the AMP Capital Community Infrastructure Fund (CommIF) and AMP Capital Core Infrastructure Fund (CIF) – now co-own the prison with the Accident Compensation Corporation, a New Zealand government agency.
Charles Savage, CommIF Fund Manager, told IPE Real Assets that his fund would own 45% of the asset, while its sister fund CIF held 25%.
“We look forward to expanding our presence in the New Zealand PPP market and continuing to invest in projects that benefit the community,” he said.
There is a lot of interest from long-term investors in PPP projects because of their (low) risk profile, he said, adding that support from investors had not been impacted by current market volatility.
AMP Capital CIF Fund Manager, John Julian, said the investment would deliver consistent and sustainable returns, including an attractive income yield over the long term, to the fund’s retail investors.
AMP Capital currently manages 18 brownfield assets structured as (or similar to) PPP projects in Australia and New Zealand, with a total enterprise value of approximately A$6.8bn.