Canadian investor Oxford Properties has moved to divest $1.5 billion worth of office towers around Australia in a bid to fund capital reinvestment.
Oxford, the real estate arm of Canadian pension fund giant OMERS, is moving quickly to offload the assets in order to focus on acquiring and managing premier properties and development schemes in Sydney and Melbourne.
The assets for sale are part of Investa Office Fund's $4.4 billion 19-asset portfolio which Oxford acquired late last year.
The collection includes five buildings in Brisbane, two in north Sydney, one in central Sydney and one building in Canberra.
The Brisbane listings, comprising of two groups of contiguous assets, include 239 George Street and 15 Adelaide Street; and at 295 Ann Street, 140 Creek Street and 232 Adelaide Street.
In Sydney, 6 O'Connell Street is for sale, along with 99 Walker Street and 111 Pacific Highway in north Sydney. In Canberra, 16-18 Mort Street is also on offer.
All of the listed assets are located in established commercial markets, strategically situated and secured by strong tenant covenants across diversified industries.
The disposition will enable Oxford to gather enough capital as an investor in other to forge new opportunities emerging in the local market.
Oxford, which has a record of sounding out major commercial towers acquisitions in gateway cities, will look to recycle the proceeds to finance the growth of its existing portfolio as well as future acquisitions.
“We have carefully identified a collection of high quality, well-located properties for sale that we believe will be very attractive to the market,” Oxford Properties Group director Alec Harper said.
The scale of the sell-down is significant because it indicates Oxford could realise enough capital from the process to enter the fray again as an investor in other opportunities emerging in the local market.
“This will enable our team to focus on the assets that most closely align with Oxford’s overall global investment strategy,” Harper said.
“I provides us the opportunity to recycle sale proceeds to fund growth in our existing portfolio as well as future acquisitions of on-strategy, premier assets in Australia’s gateway cities.”
Cushman & Wakefield's Josh Cullen and Mark Hansen have been appointed to advise on the overall sell-down process.
Cushman & Wakefield national director Josh Cullen highlighted that the assets on offer had been exceptionally well-managed by Investa, contributing to the significant in the properties.
It is now expected that the listed properties will be sold individually or in small groups, rather than as a single portfolio, as Oxford looks to maximise its return from the 10-asset collection.
“We believe that bringing the assets to market as a collection provides scale that offers additional investment potential for market participants on this already attractive offering,” Cullen said.
Oxford's parent company OMERS first arrived in Australia three years ago as part of a consortium with the Future Fund, QIC and Global Infrastructure Partners which bought out the Port of Melbourne on a 50-year lease.
The group recently sold a smaller Perth tower, located at 66 St Georges Terrace, to property funds house Corval for $72 million after being valued at $65 million.
Oxford has also partnered with builder Grocon in the $2 billion Barangaroo Central project in Sydney.