The investors in the AMP Capital Wholesale Office Fund (AWOF) have today voted to appoint Mirvac as their new trustee and Fund Manager in a blow to both AMP and Dexus.
AWOF is comprised of 11 prime grade assets concentrated in the Sydney and Melbourne markets. The
portfolio is underpinned by high quality modern assets such as Quay Quarter Tower, Sydney, along with
iconic assets such as Collins Place, Melbourne, and features a WALE of 5.5 Years, an occupancy rate of
92.5% (by income) and NABERS Energy Rating of 5.3 Stars.
It is expected that the Mirvac Trustee will become trustee of AWOF in mid-October 2022 (âEffective Dateâ).
From the Effective Date, Mirvac will be the investment manager and property manager (in respect of
AWOFâs wholly owned assets) of AWOF.
The required majority of AWOF unitholders did not vote in favour of the constitutional amendments relating to the governance of AWOF and to give effect to the liquidity facility (described below). It is, however, expected that the Mirvac Trustee will propose equivalent constitutional amendments at a subsequent meeting of the AWOF unitholders within 20 business days following the Effective Date. Once these constitutional changes are made, AWOF will be known as the Mirvac Wholesale Office Fund.
Subject to those amendments being approved by AWOF unitholders, Mirvac will then offer AWOF a total of $500m of liquidity. It is expected that this liquidity will be utilised within six months of the Effective Date.
As a result of the transaction, Mirvacâs third-party capital under management will grow by ~76%, increasing to ~$18.1bn.
Mirvacâs CEO & Managing Director, Susan Lloyd-Hurwitz, said âWe are pleased to have been entrusted
by AWOF unitholders with the management of one of Australiaâs leading unlisted office funds. The
addition of the $7.7bn fund is an acceleration of Mirvacâs long stated strategy to grow our third-party
funds under management with aligned capital partners, and further enhances our position as a top
tier manager of prime office assets in Australia.
âWe are pleased to offer AWOF unitholders reduced fees, a standalone trustee with a majority
independent board and access to Mirvacâs market-leading, integrated asset creation and curation
capabilities and platform including our $9.2bn office and mixed use development pipeline. Todayâs
vote by AWOF unitholders demonstrates their faith in Mirvac as a stable platform with a clear focus
on governance and a long track record of delivering unitholder value.
âAWOFâs modern, high-quality portfolio, recently enhanced by the completion of Quay Quarter, is
strongly aligned with Mirvacâs investment strategy and existing portfolio. We look forward to working
with unitholders to continue to enhance the performance of AWOF over time.â
AMP Capital and Dexus put forward a combined proposal to retain management of the fund including
enhancements to governance and significant alignment capital, but were insufficient to sway the decision of the investors.
The decision to change manager and trustee does not affect the sale of AMP Capitals’ (Collimateâs) real estate and domestic infrastructure equity business to Dexus, which is currently anticipated for the end of September. The earn out amount payable to Collimateâs by Dexus under the SPA will reduce to a maximum of approximately $75 million taking the maximum potential price to approximately $325 million including the $250 million upfront cash payment. Dexus will no longer acquire Collimateâs committed co-investment stakes in AWOF totalling circa $270 million.
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