Blog

[SINGAPORE] Property developer Mapletree Investments could be preparing to divest an office portfolio in Australia valued at A$1.4 billion (S$1.2 billion) – potentially marking one of the largest real estate sales Down Under in this decade. 

Citing unnamed “industry players”, Australian media said the Temasek-backed real estate investment giant is likely to split any offer of the properties into at least two tranches, to capitalise on different buyer pools. 

It added that some individual buildings could also be snapped up by private buyers, given that many are suburban assets which could either be repositioned or repurposed.

The potential divestment comes after a period in which mainly city or long-leased assets have transacted. 

While suburban market values have fallen, the portfolio could provide an entry point for new players, or for private investors and value-add firms.

Mapletree’s Australian office portfolio – comprising buildings across major cities – was assembled just before the pandemic. 

The Singapore asset manager, anticipating a market reset then, was one of the top buyers of Australian office properties among foreign investors.

Mapletree first entered the Australian market in 2014, as it looked to capitalise on rental growth amid limited office supply. 

In 2019, the developer closed its Mapletree Australia Commercial Private Trust (Mascot) fund, which raised A$654 million in equity. It retained a 27 per cent stake in the trust. Other backers included Indonesian developer Sinarmas Land. 

Mascot, which was set up with a five-year term with provision for two extensions of one year each, attracted institutional investors such as pension funds, insurance companies, regional banks and corporates, as well as high-net-worth and family office investors. 

It was designed as an income-yielding fund, with 10 Grade A office assets across Sydney, Melbourne, Adelaide, Brisbane and Perth.

In response to queries, a spokesperson said: “Mapletree is constantly evaluating Mascot’s strategy to maximise value for its investors.”

While the property market was disrupted by the Covid-19 pandemic, there is now renewed optimism over the recovery of the office sector.

If the reported divestment materialises, it would mark the exit from one of Mapletree’s largest investments in Australia. 

The portfolio spans a total of about 160,000 square metres of net lettable area, and comprises “reputable” occupiers from industries ranging from technology, media and telecom to government, mining, and oil and gas.