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U.S. and Canada comprise 13% of Aware Super's global

property

assets

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Looking for sites near major population centres that will

attract good tenants

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Recently made deal with Goodman for 3 sites in Los Angeles

By Scott Murdoch

SYDNEY, Oct 2 (Reuters) - Australia's Aware Super, a

major pension fund, said it is looking at investing further in

U.S. property, confident the country's longer term economic

fundamentals and domestic consumption levels will not be

derailed by current political volatility.

The A$190 billion ($125 billion) fund, one of Australia's

five biggest pension funds, announced this week that it would be

embarking on a $1.3 billion venture with Australian developer

Goodman Group ( GMGSF ) to buy a U.S. industrial property fund

that owns three logistics sites in Los Angeles.

Funds participating in Australia's A$4.1 trillion ($2.7

trillion) compulsory retirement savings scheme, known as

superannuation, are increasingly turning to international

investments to notch higher returns.

Aware Super's head of property Alek Misev said the U.S. was

attractive as global interest rates were likely to fall further,

and because technology advances and the country's domestic

consumption rates remained strong.

The U.S. and Canada make up 13% of Aware Super's global

property assets, while Australia accounts for 65% and the UK and

continental Europe account for 20%, according to the fund.

"You need to take a view longer term and have conviction

that short-term volatility will even out in the long run over

time. And it's not different in Europe or in Asia-Pacific. You

need to look at the fundamentals," Misev told Reuters in an

interview Thursday.

The U.S. government is currently in shutdown after Congress

failed to pass a funding bill for the new fiscal year - the

deadlock stemming from a standoff over healthcare policy and

federal spending priorities.

Misev said Aware would focus on well-located property

assets, close to major population centres that could attract

high-quality tenants.

"Demand is there, there's not much supply coming in and

interest rates are probably going to come down over time," he

said.

"In property, those are the tailwinds you would like to see.

If you then look at where pricing is, we think it's somewhere at

the bottom in the U.S. and Europe and Australia."

"That is why we are more active right now."

Tenants at the three sites in the Goodman deal include

Amazon ( AMZN ) and Maersk, Aware said.

Aware Super's senior portfolio manager Anjana Moran noted

that as the fund was working through the deal, it had to factor

in U.S. President Donald Trump's April announcement of sweeping

tariffs on trading partners.

"There were announcements around tariffs and when we were

thinking about logistics assets and potential exposure to the

trade risk, that obviously gave us pause and we needed to do

more work to get comfortable and we were able to do that," Moran

said.

The fund is the most exposed to industrial property at 32%,

while residential accounts for 30% and office properties

represent 17% of its portfolio.

($1 = 1.5117 Australian dollars)