Dexus retreats from infrastructure, reviews A$7.3B in funds after AMP Capital takeover
Australian property group Dexus is scaling back its infrastructure business three years after acquiring AMP Capital's platform, with several funds set to sell assets and return capital. The review covers A$7.3 billion of third-party funds and follows a court dispute over a stake in Melbourne Airport
Australian property group Dexus is scaling back its infrastructure business three years after taking over AMP Capital’s domestic real estate and infrastructure platform, with several of the infrastructure funds it inherited set to sell assets and hand capital back to investors.
Dexus has reviewed its infrastructure funds and mandates and found that clients across a number of funds are seeking liquidity, with the company set to refocus on office, industrial and retail, plus a targeted alternatives platform, according to an ASX filing on Wednesday. The infrastructure vehicles represent A$7.3 billion of third-party funds under management, Dexus said.
The shift represents a retreat from a strategy that Dexus had endorsed just two months ago. Its 2026 annual report, released on 20 August, listed infrastructure and healthcare among the six sectors where it would invest. When the review began in June, the infrastructure business represented about 20 per cent of Dexus’s third-party funds under management.
“The infrastructure review has given us a clear basis to simplify the platform and focus our capital and capability where Dexus can deliver the strongest long-term outcomes,” Group CEO Ross Du Vernet said. For fiscal 2027 the Dexus Diversified Infrastructure Trust, which has A$2.0 billion of third-party funds under management, will focus on asset sales to provide client liquidity, according to Dexus’s AGM presentation. The A$1.3 billion Dexus Community Infrastructure Fund is “reviewing all options” to deliver liquidity to clients, it said.
Macquarie Capital was engaged to support the review, which included consultation with more than 70 parties. The review also covered the Dexus Core Infrastructure Fund, which Dexus told investors in November 2025 had been terminated, and which is still selling its remaining assets. Infrastructure will not disappear entirely, with Dexus saying it will limit future infrastructure activity to areas predominantly enabled by physical real estate. Its alternatives platform is focused on data centres, specialised living subsectors and pan-sector opportunities such as healthcare precincts, while it will continue to deliver on existing commitments in healthcare, public-private partnerships and transport, Dexus said.
A separate review is under way at the Dexus Healthcare Property Fund (DHPF). Following a rise in redemption requests, the fund’s responsible entity has engaged an independent adviser to review options including asset sales, alternative capital and ownership structures, or a wind-up. DHPF has A$1.1 billion of third-party funds under management, and Dexus has a A$180 million co-investment in it. Together, the funds under review account for about A$8.4 billion, or 23 per cent of Dexus’s A$36.1 billion in third-party funds under management, according to a Mingtiandi calculation.
The retreat from infrastructure also follows a dispute over a stake in Australia Pacific Airports Corporation (APAC), the owner of Melbourne and Launceston airports, held by Dexus-managed funds. The Dexus Bloc, a group of interests representing about 27 per cent of APAC, came under Dexus’s management through the 2023 AMP Capital transaction, and in May the NSW Supreme Court handed down a judgment against it in proceedings relating to a sale process. That ruling upheld a default notice that could force the bloc to sell its stake to APAC’s other shareholders. The judgment prompted Dexus to launch the infrastructure review in June. On Monday, the court ordered Dexus to pay the costs incurred by APAC, IFM Investors and Future Fund in the fracas, with the bill coming to about A$30 million, according to an ASX filing on Tuesday. Dexus said the costs were within the A$60 million of estimates that the company expensed in FY26. The bloc’s appeal remains scheduled for 30 November to 2 December, and any challenge to the decision on reimbursement of costs may be heard at the same time. Dexus has warned that the strategic review may not be finalised until the appeal outcome is known.
Dexus is also pursuing a sell-down of its own real estate holdings as it tries to close the gap between its share price and asset values, with the company’s securities trading at a 35 per cent discount to net asset value. “The security price materially understates the value of the underlying investments and value in the platform,” Chair Warwick Negus told the AGM. “The Board acknowledges this disconnect, and we are working with management on improving it, both in the near-term and sustainably over time.” The group is targeting the release of more than A$2 billion of capital over FY27-28 by bringing third-party capital into core long-term holdings, including a partial sell-down of Atlassian Central. It is also exploring opportunities to bring institutional investors into portfolios of high-quality office assets it owns on balance sheet. Released capital could repay debt, fund new investments or support a buyback, Dexus said. Dexus has completed about A$2.5 billion of divestments, exceeding its A$2 billion target for FY25-27. These include the sale of two Hickson Road offices in Sydney and 123 Albert Street in Brisbane to BGO and its partners, which reached initial settlement after quarter-end.
