Foresight Australia’s Diversified Infrastructure Trust (DIF) will be wound up and its assets sold over the next three years.

The move was disclosed by True Infrastructure – a fund of funds investor in Foresight’s Australian funds, including DIT, the Energy Infrastructure Trust (EIT) and Australian Renewables Income Fund (ARIF) – in its quarterly report for the three months through December.

It said that during the quarter DIT unitholders voted for a sale of its assets. DIT exceeded expectations for the quarter, delivering a return net of fees of 5.5%, the report noted.

Although DIT was started as an open-ended fund in 2006, about a decade ago it was decided to make it a closed-end fund. Its term ended in the middle of last year, sources said.

The core infra fund is one of many that has faced redemptions in the past few years as super funds shy away from low risk, low return assets.

Australian fund manager Infrastructure Capital Group (ICG) established DIT, as well as EIT and ARIF. ICG was acquired by LSE-listed Foresight in 2022.

Then ICG owner Mike Fitzpatrick established True Infrastructure in 2020 to target rich individuals. It only invests in Foresight’s Australian funds and Atlas Infrastructure, an investor in listed infrastructure companies.

Foresight is already in the process of selling its stakes in remote area energy generation developer Zenith Energy and bus operator Kinetic.

First round bids for Zenith were lodged last week, additional sources said.

The Kinetic sale did not attract enough bidders last year at high enough prices for the whole business, so the seller has moved to selling just its Australia and NZ business, local media reported last month.

Foresight owns 24% of Zenith and close to half of Kinetic. DIT is a shareholder of these businesses, but it is not clear how much of these investments are in the DIT fund.

Other assets owned by DIT include Flinders Ports in South Australia, which is 29.1% owned by Foresight funds, 50% of Port Hedland Airport in Western Australia and 75% of the Springvale Water Treatment Plant in NSW, according to Infralogic data.

Foresight has years to sell these assets, however, and is not planning to start sales of these soon.

Australian super funds have moved out of core infrastructure assets because of new regulations requiring super funds to beat annual performance benchmarks, as well as consolidation of super funds leaving them overweight some core infra assets. Heightened interest rates making other low risk investments more competitive have also played a role.

The Infrastructure Fund, managed by Macquarie, is now being wound up. Utilities Trust of Australia managed by Morrison, has been forced to sell some assets. Last week, unitholders of Dexus’ Diversified Infrastructure Trust were told that the fund manager is conducting a strategic review of the fund after redemptions requests hit more than AUD 100m.

A spokesperson for Foresight declined to comment.