Malaysia’s EPF enters Australian property market

11 April 2017   Category: News, Asia, Australia, Global, Malaysia   By Asia Asset Management

Malaysia’s Employees Provident Fund (EPF), the largest pension fund in the country, is investing A$154 million (US$115.55 million) in a property development project in Australia.

Malaysian industrial group OSK Holdings said the EPF is paying for a 49% stake in Yarra Park City Pty Ltd (YPC), the company’s Australian subsidiary which holds development rights for Melbourne Square, an upcoming five-acre mixed-use development project in Melbourne, Victoria.

OSK will hold the balance 51% stake via another subsidiary, PJ Development Holdings, the company said in a statement last week (April 5).

OSK says the project will transform a former carpark bounded by the Westgate Freeway and Kavanagh, Balston and Power Streets in Southbank into a dynamic mixed-use community and retail centre, with an expected gross development value of A$2.8 billion.

EPF chief executive officer Shahril Ridza Ridzuan says in the statement that the project fits with the pension fund’s long-term objectives and would be a good addition to its overseas portfolio.

“The increasing demand for residential (property) in Melbourne, Australia, will enable EPF to generate returns for its members,” Mr. Shahril says.

This is the second overseas property venture for the pension fund after it teamed up with Malaysian companies S P Setia and Sime Darby to develop the Battersea Power Station in London in 2013.

The EPF had 731.11 billion ringgit (US$164.72 billion) in total AUM at the end of 2016, the fund said in a statement in February.