Barings snares Altis Property Partners platform in $6bn move

Left to right: Alastair Wright, executive director at Altis, Duncan Robertson, head of international at Barings, Altis executive director Shaun Hannah and Paul Notaras from Altis.

Global investment manager Barings has forged deeper into the Australian market with the acquisition of the $6bn Altis Property Partners platform.

While the firm already has a well-regarded debt operation, the purchase will make it one of the top private equity real estate players in the country as conditions for more opportunistic property plays ripen.

Barings is one of the global giants of investment management with a near $US350bn ($502bn) global empire, and it has the heft to take on big global players like Brookfield and Blackstone as it chases local deals.

The future of Altis, which was founded by property veterans Paul Notaras, Shaun Hannah, Alastair Wright and Chris Packett in 2008 in the shadow of the Global Financial Crisis, was the subject of sale speculation earlier this year.

The senior executives will commit to Barings and look to capitalise on the global balance sheet, with the international manager backing their reputation for savvy purchasing and repositioning across a wide range of real estate sectors.

Altis’s holdings span office, industrial, residential and tourism and leisure projects, as well as infrastructure plays, including Bankstown Airport in Sydney.

Altis sports deep ties with superannuation funds across Australia and was one of the early movers ahead of the industrial property boom. It also has a strong reputation in suburban office assets and its flagship funds have been strong performers.

The deal also displays the value of real estate funds operations which have been under pressure on the sharemarket. But property players are still keen on the area.

Just last week, South African-backed Growthpoint Properties Australia snapped up the Fortius Funds Management business which controls a near $2bn real estate empire.

Barings has more than 200 investment professionals across 16 offices in nine countries and a major presence in the US and Europe. Its global real estate platform handles real estate debt and equity of $US48.9bn.

The deal will add Altis’s 44 professionals and $6.08bn in assets, mainly focused on value-add strategies that complement Barings’ real estate debt team in Australia.

“We’re excited to welcome Altis to our real estate platform as we strengthen our local investment capabilities in Australia and continue to expand our footprint in the region. Asia-Pacific makes up about a third of Barings’ third-party AUM and is expected to be a key driver of growth for us,” Barings chairman and CEO Mike Freno said.

He added that Barings had led private credit and real estate debt investments in Australia. “We’re confident Altis will help us broaden our investment capabilities in the region.”

Barings flagged a focus on Australia before expanding into other markets such as Japan and Korea.

Altis executive director Alastair Wright said Barings had a “similar team-based approach, culture and investment philosophy”.

“Altis has built a strong investment track record and solid relationships with our long-term clients. We will continue to execute on our existing strategies, delivering outstanding results for these clients, and we look forward to offering our investment solutions to a broader global client base,” he said.

Altis has been busy ahead of the deal. In June, it set up a new property platform with Aware Super, which oversees the fund’s directly owned local build-to-rent, industrial and office holdings.

Aware already has a $1.5bn property portfolio of local industrial, office and residential assets. These include build-to-rent developments – including essential-worker affordable housing – in Sydney, Melbourne, Perth and Canberra, and industrial sites in western Sydney.

Last August, US investment giant Starwood Capital and Sydney-based global investment firm Arrow Capital Partners struck a deal to recapitalise a national portfolio of office and industrial assets held by Altis.