Bridget Carter & Gretchen Friemann

The real estate sector is believed to be heating up with respect to prospective initial public offerings, with the $1 billion United Petroleum said to be back in the frame for a potential float, along with Propertylink, run by the founder of the former Valad Property Group, Stephen Day.

Propertylink is said to have Goldman Sachs working up a prospective listing in the coming months, while United Petroleum has been working with Credit Suisse and Morgan Stanley on what has been an on-again, off again deal over recent years.

It is understood fund managers have been told that a non-deal roadshow may soon be in the planning stages for United Petroleum ahead of a potential IPO, although sources close to the deal say no plans for the roadshow are currently under consideration.

Property companies listed on the Australian Securities Exchange are in favour following a recent interest rate cut, with and a further cut predicted.

The rate cuts have sparked a rally in major AREITs as yield-hungry investors pile into the stocks.

Around May last year, there were plans flagged for United Petroleum to float as a $1bn company, but they were placed on hold.

The owners of the Victoria-based petrol retailer are Eddie Hirsch and Avi Silver, South African entrepreneurs who founded the business more than 30 years ago.

They own an extensive a property portfolio, including office buildings, and it’s unclear whether some of those assets will be carved out of the business ahead of a float.

Under consideration last year was a deal where the company would be restructured and United Petroleum’s real estate and operational arms hived off into separate entities.

UBS was previously on the ticket but is no longer working with the company.

KPMG Corporate Finance was also a financial adviser in July 2013 with Hirsch and Silver instructing the firm to explore a sale or strategic alliance with an international partner.

Another petrol station property owner, Viva Energy, which has a portfolio of sites with Coles-branded petrol stations, is slated for a listing this year.

Propertylink is a real estate and infrastructure fund manager led by Stephen Day, who chaired the once-listed Valad Property which was purchased by Blackstone following its downfall in the global financial crisis.

It has amassed more than $2 billion in assets and bought more than $600 million of property last year, prompting speculation that a listing could be imminent.

Goldman Sachs was a major backer of its funds and could be in search of an exit, sources said.

Extracted in full from The Australian.

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