AMP Life is offering to sell units in AMP Capital’s $4.2bn (€2.58bn) Australian shopping mall fund at a 7% discount to their net asset value, according to people familiar with the matter.
The parcel of units, valued at A$300m, in the AMP Capital Shopping Centre Fund, has come onto the secondary market at a time of uncertainty about retail real estate.
The fund owns some of the largest and best-known shopping malls in Australia, including Macquarie Shopping Centre, Warringah Mall and Liverpool Shopping Centre, all located in densely-populated Sydney suburbs, and the Westfield Southland Shopping Centre in Melbourne.
Although Australian fund managers of retail assets, including QIC and Lendlease, have been besieged by redemption requests, as institutional investors seek to reduce their exposure to the sector, funds managed by AMP Capital are believed to have fared better.
In May, IPE Real Assets reported that an estimated A$5bn of units had come onto market from wholesale real estate funds in Australia, the majority of which involved funds focused on retail property.
AMP Capital declined to comment on the new secondary-market offering.
A source told IPE Real Assets that AMP Capital fund did not receive redemption requests at its last liquidity window in November 2017. The fund will hold its next redemption window in November 2022.
IPE Real Assets has been told that AMP Capital fund is “broadly performing in line with the industry benchmark for wholesale shopping centre funds”.
The reason for the decision by AMP Life to offload its units is not known, although the business has embarked on a restructure of its investment exposure.
AMP Life is one of the largest investors in the shopping centre fund, with an interest of 13.71%.
Existing investors will have pre-emptive rights to any units offered for sale.
Lendlease recently sold its 50% stake in the Westfield Marion Shopping Centre in South Australia for A$670m to SPH Holdings, which today told its shareholders at an AGM in Singapore that the asset had good long-term prospects.
QIC is reportedly selling five shopping malls in the US to meet redemption requests.