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AIMS eyeing landmark deal

Ben Wilmot

AIMS Financial Group is in talks to acquire an office tower in Sydney's central business district from Investa Property Group and one of its managed funds for about $190 million

The acquisitive group is believed to be keen to pickup 320 Pitt Street as its first major play on behalf of US property funds manager REIT Management & Research LLC (RMR).

AIMS is advising the US firm, which is planning to build a property portfolio of up to $US 1 billion in Australia.

The privately held group, whose United States-Iisted CommonWealth REIT recently took the small MacarthurCook Industrial Property Fund private, wants to build up its holdings over the next year.

It is working with George Wang's AIMS, which managed the small MacarthurCook fund, on buying office and industrial properties across Australia.

Boston-based RMR was set up in 1986 to manage publicly owned real estate investments and has lifted its assets under management to more than $US17 billion and may eventually float a trust in Australia.

The deal on the Sydney tower is likely to show a yield of about 7.75 per cent, market sources said.

It comes as Abacus Property Group continues due diligence to acquire two adjoining Martin Place properties being sold by wealthy publican Cyril Maloney for about $155 million. The sales are likely to demonstrate the growing confidence in Sydney's office investment market for prime towers.

Investa's 320 Pitt Street, Sydney property is tipped to be AIMS's next big acquisition.     Photo: Roa HOMER

The Investa tower has a NABERS energy rating of 4.5 and spans a net lettable area of 29,159 square metres.

The 32-level A-grade tower is almost entirely occupied by Telstra Corporation.

Investa declined to comment on the talks yesterday but in a recent update to unit holders in its unlisted Investa Diversified Office Fund said it was in active discussions with potential buyers for 320 Pitt Street, Sydney.

However, Investa cautioned unit holders that large assets sale were taking time, particularly against the backdrop of an uncertain global economy and when dealing with international buyers.

A deal could allow the unlisted trust to reopen next year if its gearing ratio falls to between 40 per cent and 45 per cent.

There are high hopes that AIMS will complete a deal as it has made its ambitions to expand locally well known in the market.

The group is understood to have put itself forward as a contender for the management rights of a series of unlisted property funds which Brookfield Multiplex is considering selling.

The funds include another listed trust, the Brookfield Australian Opportunities Fund, development funds, a property income fund, as well as offshore-invested vehicles.

AIMS is said to have targeted other property funds management groups that are looking to exit the industry.

AIMS has already set up a global property securities management business with high-profile fund manager John Snowden.

However, the group's next big move is likely to be a direct property play, with the Pitt Street tower seen as a potential landmark transaction.

AIMS Financial Group declined to comment yesterday.

    AIMS eyeing landmark deal