Michael Gutman

Following a solid year of investment into value-add opportunities, Assembly Funds Management (AFM) has reopened its second real estate fund, ADPF2, to investors targeting a net 13-15% per annum return with an average 8%-10% distribution post the investment period.

“With 65% of the fund already invested, investors can gain immediate exposure to more than $110 million in high-conviction opportunities across the Retail and Living sectors, with the ability to put the lion’s share of their capital to work from day one,” said Michael Gutman, AFM’s CEO. “The fund assets include a share of the Woodgrove investment,” he said.

Earlier in the year AFM completed the acquisition of the $440 million Woodgrove Shopping Centre, which marked the AFM founder’s first investment back into retail since the sale of the international Westfield business to Unibail-Rodamco in 2018.

“We are pleased with the strong performance to date at Woodgrove, a centre which is  considered the  heart of the rapidly growing city of Melton. The centre is 99% leased with various levers available to drive outperformance,” said Mr Gutman.

“Our unique strategy for the fund series has been to create a diversified portfolio that blends strong demographic growth underpinning the Living sector coupled with opportunistic investment in Retail and Office where we see irreplaceable assets being undervalued relative to previous market cycles.”

The Seniors Living sector within Australia has seen significant investment activity over the last 12 months as both institutional investors and public markets better understand the investment dynamics of this sector, while underlying demand for the product continues to be robust.

The sector has seen a surge in investment activity over last twelve months, with the $3.85 billion sale of Aveo to The Living Company, the $845 million sale of Retire Australia to Invesco, and the $750 million IPO of GemLife Communities which hit public markets in July 2025.

AFM has focused its attention on two sub-markets of the seniors Living sector, targeting downsizers through the creation of Land Lease Communities and Retirement villages.

“While asset selection remains critical alongside a clear understanding of the underlying tenant dynamics, we continue to see highly attractive opportunities in the Retail and Office sectors where investment can be made at significant discounts to peak valuations and replacement costs,” said Tim Meurer, AFM’s CIO.

“Our ability to undertake these transactions is strengthened by the committed capital in our funds which we see as being only more valuable as we enter this cycle. Evidence that the cycle has bottomed for retail and office assets is becoming clearer with transaction levels and competition from both domestic and offshore buyers driving improved valuations.”

“There is also a growing appetite from the domestic banks to grow their commercial real estate exposure again,” said Mr Meurer.

With listed equities at record highs, capital allocators and advisors may see APDF2 as an attractive opportunity to realise some gains and reallocate towards real assets that offer greater stability and long-term value.

ADPF2 is now open for investment and investors in the fund will gain priority access to keenly sought co-investment opportunities that are too large for the fund.

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