FLOATS: Financial services group Australian Unity is finalising a proposal to list the near $400 million Australian Unity Office Property Fund on the Australian Securities Exchange.
The long-mooted float of the unlisted property fund, which spans a portfolio of eight office towers in NSW, Victoria, the ACT, South Australia and Queensland, is partly driven by the group's desire to grow its $391m portfolio. 
Australian Unity Real Estate Investment general manager Mark Pratt said the group was well positioned to progress the listing, revealed by The Australian a year ago.
"We believe an ASX listing is in the best interests of existing investors, as it will provide access to additional equity for the sustainable growth of the fund and liquidity to those investors seeking to withdraw," he said.
The float will be the first A-REIT to list on the ASX this year, and fund managers are keen for new product. Institutional marketing will begin shortly, handled by joint lead managers Credit Suisse, UBS and NAB.
The listed Australian Unity Office Fund will seek to raise up to $155m, and proceeds will allow the trust to trim its gearing back to about 30 per cent and support a significant withdrawal offer to existing investors.
Australian Unity will retain a stake of about 15 per cent in the strongly performing fund. The portfolio was 96.5 per cent occupied and had a weighted average lease expiry of 4.7 years at the end of   April.
The float had partly been hanging on a six-year lease renewal with the NSW government at 10 Valentine Avenue, Parramatta. The recent renewal meant the tower's value jumped to $69.5m.
An explanatory memorandum will be sent to investors once the institutional marketing process has been finished.
The trust has a forecast distribution yield of 7.4 per cent for financial 2017, rising to 7.8 per cent annualised for the second half of the calendar year."If investors pass all resolutions set out in the notice of meeting, we anticipate the fund will be listed around   June 30," Mr Pratt said.