Mirvac the frontrunner as AMP fund investors mull move to new manager

The understanding is advisers will recommend a party to manage the fund, which may in fact be AMP itself, before investors cast their vote. Picture: NCA NewsWire/Steven Saphore

Investors in the $7bn AMP Capital Wholesale Office Fund are believed to be gauging the appetite for a change in manager as the fund’s adviser seeks feedback as to what party would be the most favoured replacement.

The understanding is advisers will recommend a party to manage the fund, which may in fact be AMP itself, before investors cast their vote.

For the recommended party to take the reins as manager, investors holding more than 75 per cent of the fund need to be in favour, and the investors are said to be discussing internally how to proceed and whether the vote should go ahead.

Dexus, Mirvac, GPT, Charter Hall, Stockland and Queensland Investment Corp were all shortlisted as possible parties to take over the running of the fund after they earlier submitted proposals.

The market talk is Mirvac is the front runner, given it does not already have a wholesale funds management arm, which may render it less conflicted than other contenders.

Already, Sunsuper, which owns the central Melbourne office block at 330 Collins Street, has pulled its investment management mandate from AMP Capital for the office asset.

The process for AWOF comes after the trustee this year set up an advisory committee of three real estate and corporate figures – former Future Fund property head Barry Brakey, Wesfarmers director Sharon Warburton and property veteran Paul Say – to advise on options.

Working as an adviser on the options to the fund’s investors is investment bank Jarden.

Major investors in the fund include UniSuper, Victorian Funds Management Corp and Treasury Corp.

AMP Capital’s real estate and infrastructure units has been under attack from rivals hoping to wrest control of its funds away from AMP after a tumultuous few years that included revelations from a royal commission of fees being charged for no service, sexual harassment claims against former AMP Capital boss Boe Pahari and a string of departures among top staff.

Already, investors in the AMP Capital Diversified Property Fund have voted to replace AMP as its manager with Dexus.

AMP Capital has been earmarked for demerger, but some believe those plans may be derailed should AWOF fall into the hands of another manager.

Potentially on offer to another real estate group is managing prized office assets in AWOF: a stake in the Quay Quarter complex at Circular Quay, the office complex at Sydney’s Angel Place and its Collins Place office development in Melbourne.

AMP comprises a bank, wealth management unit and the AMP Capital funds management arm.

Last year the financial giant was subject to a buyout proposal by private equity firm Ares Management, but it opted not to pursue the proposal.