$500M INVESTMENT FOR QIC

ONE OF Australia’s fastest growing superannuation funds has shown confidence in the Gold Coast property market following a $500 million investment in QIC Property Fund, the owner of Robina Town Centre (RTC).

The injection by AustralianSuper will allow QIC to acquire additional cornerstone assets in the retail and shopping centre space.

Head of global real estate Robert Carter, would not speculate on acquisition targets.

“QIC does not comment, or speculate, about its future business strategies. What I can say, however, is that we are actively managing our portfolio and will continue to investigate opportunities in south-east Queensland due to its strong economic conditions and population growth,” he says.

QIC Property Fund’s portfolio focuses on major regional shopping centres in population growth corridors, with other assets including Castle Towers shopping centre in Sydney’s north-western suburbs, Watergardens in Melbourne’s western suburbs and the Canberra Centre in the ACT.

Carter cites RTC as one of the company’s growth assets with further expansion of the centre committed until the end of this year.

“Robina Town Centre on the Gold Coast is a strategic retail asset in QIC GRE’s property portfolio and over the past three years we have invested $400 million in a multi-stage, landmark expansion of the Centre,” he says.

“By the end of 2010, the final stage of the expansion will deliver a new two-level Myer department store and additional specialty retailers, further reinforcing its position as the Gold Coast’s super regional shopping centre.”

He says there’s a strong alignment between AustralianSuper’s investment objectives and QPF’s long-term growth strategy.

“Importantly, AustralianSuper is highly compatible with QPF’s existing investors,” he says.

“QIC Global Real Estate (QIC GRE) has a track record of delivering stable returns from its portfolio of properties since the commencement of real estate investment activities in 1989. The assets in the QPF have predictable income streams and significant potential for further growth.

“QIC GRE’s in-house development, asset management, and leasing teams are fully engaged in the delivery of the QPF’s investment performance. Our approach has been to acquire dominant properties in population growth areas and then further develop these investments to meet the needs of these expanding communities.

Deputy chief executive at AustralianSuper Mark Delaney, says the investment represented a reweighting of AustralianSuper’s core property portfolio in the lucrative regional retail market.

“The opportunity to invest in a portfolio of retail assets of this quality is extremely rare and we are delighted to be able to increase our holdings in the sector, particularly in regional shopping centres, which have provided high relative returns with low volatility over the past 20 years,” he says.

The investment in QPF will make up 15.2 per cent of AustralianSuper’s total property investments, based on the portfolio configuration as at 31 December 2009, and will increase AustralianSuper’s Balanced Option property sector exposure from 10 per cent to 11.7 per cent; and total fund exposure from 9 per cent to 10.6 per cent.

QIC Property Fund has around $5.1 billion in property assets including $4.2 billion of retail property.