July 27 (Reuters) – Australia’s Charter Hall (CHC.AX) is launching a A$200 million ($180.5 million) industrial property fund, an executive from the property firm said on Tuesday, in a sign of recovery in the unlisted retail market previously hit by redemptions.
Charter Hall, which earlier this year bought Macquarie Group’s (MQG.AX) real estate business, hope to raise as much as A$110 million in the next two years from retail investors with a target of buying a portfolio of assets of up to A$200 million with debt, Richard Stacker, chief executive officer for Charter Hall’s direct property business, told a briefing. The closed-end fund will aim to deliver an average annualised yield of 8.7 percent.
The unlisted retail market was one of the sectors hardest hit by the global financial crisis with many funds frozen, but some high net-worth clients remain keen to get steady income returns from property, he said.
Stacker said raising new funds “would definitely be a challenge” but some self-managed pension funds targeting high-net worth individuals were seeking such investments.
He also said demand for unlisted property products was firm, with the listed property trusts trading at a discount and seeing volatile sessions.
Charter Hall has more than A$10 billion assets under management through listed and unlisted vehicles.
Demand for industrial space was picking up in Australia and Grade A warehouse rents were expected to rise 3 to 4 percent each year for a few years from 2011, Kevin Stanley, executive director for CB Richard Ellis, told the same briefing.
(Reporting by Eriko Amaha; Editing by Ed Davies)