Around 73.5m shares were traded when Propertylink made its debut on the Australian Stock Exchange on Friday, after raising AUD503.5m (€346m) at 89 cents a share.

The Sydney-based property fund manager’s shares opened at 82 cents, closing at 86 cents.

During the day, it hit a high of 87 cents and a low of 81 cents.

Fund managers told IPE Real Estate the figure was a “poor showing”, with shares considered “too expensive” at a 20% premium to the net asset backing of Propertylink assets.

While it is not unprecedented to see such a large volume of shares traded on a first day, one source questioned why investors had sold at below issue price.

Winston Sammut, managing director at Folkestone Maxim Asset Management, said: “Some brokers might have been stuck with more stock than they wanted and were prepared to take a loss to get out.” 

Sammut, who did not take up shares in the Propertylink IPO, added: “We do not need to be there on day one.”

In the prospectus, Propertylink’s earnings forecast was predicated on additional income streams coming from AUD750m of assets expected to be acquired over the next 12 months.

“It will be difficult to get good assets in this market, and, if they manage to buy any, the quality could be questionable,” Sammut told IPE Real Estate.

Propertylink recently bought the Denison portfolio for AUD318.6m.

The deal should lift its total asset under management to AUD1.9bn.