S.Korea's NPS sells off Australian warehouse equity at $368 mn

National Pension Service (NPS) of South Korea, the world’s third-largest pension fund, said on Monday it has sold off a 50% stake in an Australian logistics center fund at A$560 million ($368 million) to UniSuper, a major retirement pension in Australia.    

The Korean pension fund bought the half stake in the warehouse portfolio at A$149 million via US real estate investor Heitman LLC in 2012. Heitman and Sydney-based real asset manager Dexus formed a joint venture to operate the fund at the time.

The fund manages 20 logistics centers, including 12 assets in Sydney and eight in Melbourne, with a total floor area of 340,000 square meters. The warehouses are leased by high-quality tenants like leading beer company Carlton & United Breweries, grocery retail giant Coles Supermarket, industrial packaging company Visy and industrial and safety products supplier Blackwoods, NPS said.    

NPS has earned a stable revenue stream from the logistics assets and will continue to invest in high-quality real estate assets overseas, Chairman Kim Tae-hyun stated.

The Korean pension fund manages 973.9 trillion won ($746.3 billion) in assets as of May 31. Alternative investments account for 15.9% of its entire assets, exceeding this year's target exposure of 13.8%.

The real estate assets amounted to 48.5 trillion won as of the end of the first quarter. The Americas-based properties make up 38.8% of NPS’ real estate portfolio, followed by European assets with 24.8% and Asian assets with 20.5%, according to the institutional investor’s report issued on Aug. 2.

The pension fund manages 62.7 trillion won in private equity and 38.8 trillion won in infrastructure as of the end of the first quarter.

Write to Byeong-Hwa Ryu at hwahwa@hankyung.com

Jihyun Kim edited this article.