Australian Prime Property Fund Commercial

Established in 1994, the Lendlease managed Australian Prime Property Fund Commercial (APPF Commercial) is a core wholesale unlisted property trust, allowing institutional investors to benefit from exposure to a portfolio of prime commercial properties across Australia. The Fund seeks to deliver its target return and superior risk-adjusted core returns to unit holders through the long-term ownership, development and repositioning of quality, environmentally sustainable and predominantly core Australian commercial real estate assets.

INVESTMENT STRATEGY 

The Fund invests in highly efficient, flexible and sustainable commercial assets, which predominantly:

  • Are located in CBD office markets
  • Have balanced low-risk lease expiry profiles
  • Have strong underlying tenant covenants

The strategy looks to deliver its objectives via asset and market selection driven by research; portfolio diversification and scale, and strategic precinct selection.

Property Portfolio

APPF Commercial comprises a high-quality portfolio of 22 predominantly Premium and A Grade assets, covering a total of 736,900 square metres of net lettable area (NLA).

In 2018, the Fund was ranked first globally of all 874 respondents in the 2018 GRESB Assessment, having also achieved this ranking in 2014, 2015 and 2017.

lendlease advantage

APPF Commercial has the ability to secure quality, environmentally sustainable office assets in the Australian market through access to Lendlease’s office development capability and pipeline.

Lendlease's track record of developing commercial office buildings in Australia spans over 50 years. At the forefront of this experience is the Barangaroo South precinct in Sydney, Australia.

Through its unique access to Lendlease’s development pipeline, APPF Commercial holds investments in all three office towers at the Barangaroo South precinct.

Recent APPF Commercial projects that have been sourced through the Lendlease pipeline and developed and constructed by Lendlease have included:

Darling Square

Sydney

A next-generation commercial building leased to CBA, Darling Square comprises over 27,800 square metres of NLA. It targets leading sustainability outcomes including 6 Star Green Star and 5 Star NABERS Energy ratings. APPF Commercial owns 50 per cent of the asset, alongside a mandate client.

International Towers Sydney, Tower One

Sydney

Tower One is the tallest of the three office towers in the precinct and comprises 108,000 square metres of NLA. This includes 48 office levels and three levels of retail. The Premium grade building is targeting leading sustainability credentials. APPF Commercial has a 25 per cent interest in the Trust that holds Tower One of International Towers Sydney.

International Towers Sydney, Towers Two and Three

Sydney

Tower Two is an 89,200 square metres Premium grade office tower, with 41 levels. Tower Three is a Premium grade, 38-level office tower of 82,000 square metres. APPF Commercial currently holds a 25 per cent interest in the Trust that holds Towers Two and Three of International Towers Sydney.

Responsible Property Investment

APPF Commercial has a vision to be recognised as a world leader in the delivery of ESG outcomes in the Australian unlisted property sector. It acknowledges the sustainability aspirations of the broader Lendlease Group and is aligned with Lendlease’s key sustainability objectives.

The Fund has had a Responsible Property Investment strategy in place since 2009.
GLOBAL REAL ESTATE SUSTAINABILITY BENCHMARK (GRESB)
APPF Commercial has participated in the Global Real Estate Sustainability Benchmark (GRESB) since 2011.

The Fund was ranked as the number one fund globally from 874 global participants in the 2018 GRESB assessment. The Fund's global ranking of first exceeds its stated 2018 target of ranking in the top five of all GRESB participants globally.

   2011 2017  2018 2018 change
GRESB Scores        
Overall score  80% 96%  98% +2%
Management & Policy  77% 99%  99% No Change
Implementation & Measurement  82% 95%  97% +2%
GRESB Rankings        
All GRESB participants  11 of 339 1 of 823 1 of 874 No Change
Global, office  4 of 69 1 of 183 1 of 189 No Change
Oceania, office - 1 of 19  1 of 22 No Change

Green Building Certification

Green building ratings for each asset as at 30 June 2018 are disclosed below:

NABERS
ENERGY

NABERS
WATER

WASTE
RECYCLING
 
ASSET
GREEN STAR
DESIGN/
AS-BUILT RATING

GREEN STAR
PERFORMANCE
RATING

CURRENT
RATING
2021
TARGET
RATING1
CURRENT
RATING
2021
TARGET
RATING2
CURRENT
STATUS3
2021 TARGET 
1 Farrer Place – Gov. Macquarie Tower, Sydney -

2 Star 4 5 3.5 4 57% 65%
1 Farrer Place – Gov. Phillip Tower, Sydney - 2 Star 4 5 3.5 4 57% 65%
1 O'Connell Street, Sydney - 6 Star 5 5 4 4.5 48% 65%
 8 Spring Street, Sydney - 2 Star 2  4.5 1 4 N/A4 N/A4
10 Spring Street, Sydney - - 4.5 N/A4  2.5 N/A4 N/A4 N/A4
 16 Spring Street, Sydney  - - 4 4.5 N/A N/A4 N/A4 N/A4
 23 O'Connell Street  - - Not rated Excepted from rating Not rated Excepted from rating  N/A4  NA/4
 Darling Quarter, Sydney  6 Star 6 Star 5.5 5.5 4.5 5 59% 65%
 Darling Square, Sydney  6 Star  - - 5.57  - 4.57  N/A4  65%
International Towers Sydney - Tower One 6 Star6  - - 5.57  - 5.57  77% 80%
International Towers Sydney - Tower Two 6 Star - 5 5.5 4.5 5.5 77% 80%
International Towers Sydney - Tower Three 6 Star  - - 5.57 - 5.57  80% 80%
International House Sydney 6 Star5 - - 5.57 - 5.57  69% 80%
Towns Place Car Park, Sydney N/A N/A N/A  N/A N/A N/A N/A N/A
485 La Trobe Street, Melbourne 4 Star6 5 Star 4.5 5 4 4.5 48% 65%
One Melbourne Quarter, Melbourne -  - - 5.57 - 4.57 N/A4 N/A4
Two Melbourne Quarter, Melbourne  - - - 5.57  - 4.57 N/A4  N/A4
66 Eagle Street, Brisbane - 6 Star 5 5.5 4.5 4.5 64% 65%
BTC (East Tower), Brisbane - 5 Star EXEMPT 5 Not rated 4.5 36% 50%
BTC (West Tower), Brisbane - 6 Star 5 5 Not rated 4.5 36% 50%
60 Flinders Street, Adelaide 5 Star 5 Star 5 5 3 4.5 100% 65%
80 Flinders Street, Adelaide 5 Star 5 Star 4 5 3 4.5 47% 65%
Flinders Link Carpark, Adelaide  N/A N/A N/A N/A N/A N/A N/A N/A
Alan Woods Building, Canberra
- 6 Star 5 5 4.5 5 22% 65%
PORTFOLIO AVERAGE
 - 6 Star8 59  5.5  4.19  4.9 61%9  68%9
 
Minimum NABERS Energy commitment 5 Star per asset, excluding GreenPower (23 O’Connell Street, Sydney is excepted as strata offices cannot be rated under the NABERS program)
2 Minimum NABERS Water commitment 4 Star per asset (23 O’Connell Street, Sydney is excepted as strata offices cannot be rated under the NABERS program)
3 Waste recycling performance as at 31 March 2018
4 Performance and targets of items not available or currently in planning
5 Green Star Deisgn rating only
6 Green Star Design rating only for North Building
7 NABERS target ratings at post completion (after meeting required occupancy threshold levels and 12 months' continuous utility data)
8 Portfolio averages weighted by building area and the percentage ownership of the asset, excluding unrated assets and 1 Farrer Place and car parks (for which the Fund does not have operational control)
Portfolio waste recycling performance and targets excluding assets with less than 12 months operational data and where the Fund does not have operational control