New Star acquires prime assets in Asia & Australia

New Star is delighted to announce that the £644 million New Star International Property Fund has acquired a further three prime properties.

The first property, 414 La Trobe Street, is situated in Melbourne. The asset comprises 17 storeys inclusive of three levels of above-ground tenant parking. The property has a net lettable area of 14,229 square metres and was purchased for AU$67.1 million. The property is let to multiple low-risk tenants.

The second property, Alinta Plaza, is situated in Perth and comprises flexible accommodation across seven floors and four car parking levels. The plaza is built on a net lettable area of 7,800 square metres. The building underwent extensive redevelopment works in 2005, achieving completion to a high specification for tenant use in May 2006. It has a committed occupancy of 100%, with the anchor tenant being Alinta Ltd, which occupies 92% of the net lettable area and has a lease that provides for annual fixed increases in rent up to 2017. The property was purchased for AU$63.5 million.

The third property, 1 Phillip Street, is a prime 16-storey office building and includes a small retail outlet on the ground floor. The property, built in 1993, has a net lettable area of 36,194 square feet and is located in the heart of Singapore’s prestigious Raffles Place office district. The property was purchased for S$99 million.

The New Star International Property Fund is currently 85.2% invested in the Asia Pacific region and 14.7% in Continental Europe and has returned 4.1% relative to a 6.13% decline for the IMA specialist sector since the fund launched on 4 June 2007.

Stuart Webster, head of global property, New Star says: “The combination of these acquisitions plus the acquisitions elsewhere in Asia and Continental Europe provide investors with exposure to a quality, diversified portfolio in what is considered by many to be a potentially more stable asset class in these volatile times.

“The early focus of the fund has been towards prime Asian markets that have thrived. Since the launch of the fund, European markets have experienced a readjustment in price – in light of credit concerns – and we prudently minimised our early exposure to this area. I expect some further weakening in Europe and, as a non-leveraged, cash-rich buyer, the fund is in a strong position to purchase prime assets at increasingly attractive valuations in this market in due course. This represents an excellent opportunity for the fund and its investors going forward.”