AMP quits Australian property

By Chris Hutching

Friday 8th August 2003

AMP is quitting its last listed property management interest in Australia but retains its unlisted property interests there and in New Zealand it is increasing its involvement in property with the recent establishment of a new development-oriented fund called AMP Property Opportunity Fund.

In a Stock Exchange announcement yesterday AMP Henderson said it was managing an exit from the listed property sector in Australia in line with the trend of recent mergers and acquisitions in that country of listed AMP trusts.

The move comes against a background of increasing numbers of Australian-based trusts, swelled with compulsory superannuation contributions, buying management entities and property assets, some of them from AMP funds based in New Zealand (such as Botany Downs retail centre in Auckland).

Three Australian listed property trusts AMP Shopping Centre Trust, AMP Diversified Property Trust and AMP Industrial Trust were recently subject to takeover offers, which were recommended by AMP Henderson. They own some commercial property assets in New Zealand but the units are only traded only in Australia.

AMP now proposes to sell its interest as the Responsible Entity for AMP Office Trust (not the New Zealand-listed AMP NZ Office Trust) for $31 million to a new management company, Ronin Property Group, although AMP will remain involved in some aspects of management.

The moves are subject to unitholder approval. AMP Life, which represents the interests of 1.7 million policyholders, is the largest unitholder in the Australian-listed AMP Office Trust owning approximately 21%.

If approved, the changes will result in a reduction in gross assets under management of approximately $A1.5 billion.

The annualised net profit after tax impact on AMP Henderson in Australia will be a reduction of around $A4.2 million.

If the latest proposal is approved by unitholders, AMP Henderson will have raised a total of $A87.8 million from its exit.

AMP Henderson will continue to be Australasia's largest manager of unlisted wholesale property assets with a portfolio in more than $10 billion, invested in the office, industrial and retail property sectors.

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