Macquarie Capital Bankers are believed to be hard at work on options for the investment bank's main Australian real estate investment trusts, Macquarie office Trust and Macquarie Countrywide Trust.
The smaller Macquarie DDR trust is widely thought to be in wind-up mode, but the fact that the boards of MCW and MOF are considering their futures - potentially with another investment bank assisting independent directors - is now being canvassed.
The most obvious path is internalisation and J P Morgan analysts have already noted that Macquarie's future as a manager of listed reits is unclear given the internalisations of the higher profile and more profitable infrastructure funds MAP and MIG, as well as the old Macquarie Leisure, now Ardent Leisure Group
There are also thought to be some more complex ideas on the table.
These include creating a new vehicle out of the Australian office and shopping centre assets controlled by MOF and MCW.
An internalised Australia only group would be a formidable competitor to existing diversified propert players including GPT group.
The heavily leveraged US assets in both Macquarie funds could be spun off or even combined with the smaller centres in Macquarie DDR.
JP Morgan reckons the possibilities include an MIG style carve out between the domestic and off shore assets for MOF and MCW, an internalisation of management or even keeping the status quo.
The analyst doesn't see material cost savings from bringing the funds' assets and management functions in house as they are unlikely to pay Macquarie potentially lucrative performance fees for some time. The multiple paid to internalise Macquarie Leisure implies the cost for MCW would be $40 million, and $100 million for MOF.
While internalistion may be inevitable, JP Morgan says justifying such break fees would be difficult.
MCW Price at posting:
58.0¢ Sentiment: LT Buy Disclosure: Held
