Australian heavyweights Babcock & Brown and General Property Trust have scrapped the flotation of a E1.5bn (£1bn) European retail property fund.
The Babcock & Brown GPT European Retail Fund was to have been chaired by Chris Bartram, chief executive and chairman of Orchard Street Investment Management and former managing director of Haslemere, and listed on Amsterdam’s Euronext.
But in a statement yesterday investment and advisory firm Babcock & Brown and property investor GPT said the listing had been withdrawn because it ‘would not have sufficiently realised the full value of the initial portfolio’.
The fund was seeking E400m of equity from investors and was to have been seeded with a E1.5bn portfolio of 294 supermarkets and shopping centres.
The two companies said ‘a better outcome can be achieved through other capital raising and structuring options, including through the syndication of equity in the portfolio assets to the direct investment market and/or the creation of a more simplified REIT structure, taking advantage of the
introduction of new legislation in specific European markets’.
The pan-European fund was one of the GPT and Babcock joint venture's first steps to create a large-scale international property funds management business. The partners, which have A$5.7bn (£2.3bn) of property, have set an aggressive target of A$30bn (£12bn) in assets under management in the next five years.
Nic Lyons, CEO of GPT, said: ‘The withdrawal from the IPO process does not alter the joint venture’s strategy to create and grow a funds management business’.