Abacus Property cashed-up for National Storage REIT takeover bid

Abacus Property Group managing director Steven Sewell. Picture: Aaron Francis

The $402m equity raising by Abacus Property this month got the market talking about whether the real estate group was securing the funds to make a takeover bid for National Storage REIT.

Abacus has an 8 per cent interest in National Storage, and many have predicted that the $2bn Abacus will be keen to bid for the $2bn target after it came close to being bought by Public Storage earlier this year.

The thinking is that the recent equity raising would give it the firepower to do it.

When it raised equity earlier this month, Abacus indicated that the funds would be used to pay down debt and for “growth capital”.

Abacus’s strategic focus is to target storage assets and reduce exposure to retail and industrial.

However, the understanding is that Abacus has no plans to target National Storage for now.

Some are wondering about its intentions for Australian Unity Investment Real Estate and particularly the Australian Unity Office Fund that it manages.

Abacus bid for the office fund in the past with Charter Hall, but was rebuffed.

However, some think Abacus may have more sway with major shareholder Hume when it comes to convincing it to accept a rival bid.

Australian Unity Office Fund has a $354m market value and Abacus has aspirations to grow.

The office owner is seen as the best value in the sector and deal-makers are focused on how to unlock value.

Hume Partners holds about 19.9 per cent of the company, while the manager owns about 15 per cent and Singapore’s Keppel is a major shareholder.

Abacus is understood to only want some assets last time around — Charter Hall is to take the remainder.

No doubt if Abacus decides to pursue the target there will be plenty of investment bankers on hand next year more than willing to provide advice, given many have recently jumped ship to new firms.