QIC Launches Billion Dollar Property Fund

Queensland Investment Corporation (QIC) has launched a US$1.4b property fund to invest in US retail property, according to The Australian Financial Review. 

The portfolio largely comes courtesy of an existing arrangement QIC has with US partner Forest City Realty Trust, a $US9 billion investment platform based in Ohio.

One of the properties, The Shops at Tanforan centre in the San Francisco Bay, is held solely by QIC. It bought it last year for almost $US175 million.

Steven Leigh, Managing Director QIC Global Real Estate[/caption]

The Australian reported QIC has accumulated stakes in 12 US shopping centres, all but one through the venture with Forest City. The joint venture deals began three years ago when QIC first entered the US. Through these shopping centre deals, QIC has now amassed a portfolio of more than $3 billion on the US mainland, boasting a low average occupancy cost of 11.2 per cent.

QIC's Global Real Estate managing director, Steve Leigh, told The Australian Financial Review that the fund would be a core plus open-ended fund targeting direct investments in US regional shopping centres.
 "Initial market soundings confirm our view that there is strong institutional investor interest in participating in this fund.

"The retail market in the United States is attractive to QIC due to the supportive fundamentals of a sound and growing economy, employment growth and positive consumer confidence," Mr Leigh told The AFR.

QIC's global property platform now manages $16.5 billion worth of real estate according to The AFR.

 QIC has reportedly spent a decade in the US performing market analysis before this announcement to enter the US retail property market.

Under a separate mandate from AustralianSuper, QIC reportedly secured a $1.1 billion stake in an Hawaiian shopping centre.