KEY POINTS:
ING Property Trust is not ruling out another tilt at international assets, despite backing away from a $200 million entry into the Japanese market.
Managing director Andrew Evans said while the trust was deferring doing anything now it would continue to monitor the international markets.
"I think the dynamics of the Japanese market are compelling ... and I think there will be a lot of value created for unit holders by investing in Japan but, unfortunately, we won't be part of that at this stage."
The investment, which would have equated to 20 per cent of the trust's portfolio, required unitholder approval.
It was called into question by some of ING Property's major investors who saw it as a risky move away from the local market.
In an announcement to the stock exchange after markets closed on Thursday, the trust said while some investors saw the lack of exposure to international property markets as a weakness, others wanted the trust to stay as a local investor.
Evans said after meeting major investors after the April announcement, the trust decided it did not have a high level of consensus for the Japanese investment.
"We were also conscious that, over that period of time, our unit price had fallen."
Evans said the drop was a result of the Japan announcement and AMP NZ Office Trust's $70 million capital raising attracting investors to the detriment of ING Property.
Since April, the ING Property unit price has averaged $1.26, down from the $1.34 the day before the announcement.
Macquarie Equities investment director Arthur Lim said the company was accepting a hard reality that it would need to go back to basics and meet the desires of investors. "No company likes a backdown."
However, he said it was better for it to admit it was wrong than continue with a plan that was hurting the share price and could hurt growth prospects.
Lim said if ING did believe in the Japanese property market, it would need to attract a different investor base and recognise local investors preferred stable, high yields over growth.
