The property asset management division of Colonial First State Global Asset Management (the 'Asset Manager') is a full service property, leasing and development management business responsible for managing approximately $17 billion of assets for a variety of listed funds, unlisted funds and private investors. It is a stand-alone business based at Chadstone Shopping Centre in Melbourne.
The Asset Manager is the exclusive provider of property, leasing and development services to CFX under an agreement which also provides income (flowback or alignment fee) to the Trust and CFX unitholders. The entitlement to flowback is based on the proportion of the Asset Manager's income derived from the management, leasing and development of CFX assets in proportion to the total income generated from the management of assets on behalf of the Colonial First State Global Asset Management suite of property funds.
The Asset Manager originated as part of the Gandel Group (and was then known as Gandel Retail Management (GRM)) which was established in 1983 by John Gandel AO to manage the shopping centres owned by the Gandel Group of companies.
In 1994, the Gandel Group listed the Gandel Retail Trust on the Australian Stock Exchange. At that time, GRM managed a portfolio of six shopping centres valued at approximately $1.1 billion. In October 2002, when the Gandel Retail Trust acquired the Colonial First State Retail Property Trust, the Trust changed its name to CFS Gandel Retail Trust and GRM was managing 31 shopping centres valued at approximately $5 billion.
The Asset Manager currently manages an Australian retail portfolio valued at over $13 billion.
The Asset Manager seeks to maximise opportunities for its further growth over the medium-to-long term by ensuring that the properties it manages on behalf of owners are maintained and developed to their full value and potential.
Asset management’s focus on intensive asset management adds significant value to the Trust by leveraging economies of scale and long-term relationships with local, national and international tenants, as well as key service providers and contractors for products such as centre cleaning, air-conditioning, security, marketing, insurance, repair and maintenance.
The asset management division operates within a centralised structure. Head office manages the leasing, development, management, finance and people services function to allow the centre management teams to focus on driving retailer sales and customising each centre’s offer to its local trade area and community.
Industry-leading procedures and systems ensure a consistent reporting platform across all centres. This leads to operational efficiency across the portfolio, with most shopping centre contracts let on a national basis.
The Asset Manager's specialist retail property management skills enable property owners to receive the benefit of master planning and development expertise, which is critical to ensuring that assets are enhanced and strategically positioned for long-term growth and success. This was highlighted by the Trust’s involvement in the acquisition of the Myer Melbourne site. The acquisition proposal, which included a $500 million redevelopment of the centre by Asset Management, was eventually chosen not only on price, but predominantly for the retail development solution provided for existing tenant and vendor, Myer Pty Ltd. Over the six months to December 2009, the Asset Manager completed $525 million of CFX development projects ($850 million at 100% ownership), a record for any period in the Trusts history.
Associated entities
Commercial
In 2008, the Asset Manager’s capability was expanded to include commercial office and industrial assets and the insourcing of Commonwealth Property Office Fund’s (CPA) property management business to an affiliated entity was completed. This provides a greater alignment of interests between CPA and the Asset Manager’s affiliate whilst delivering a new income stream for CPA unitholders.
