Equites Property Fund Limited will join the JSE as an office and industrial property manager and developer later this month.
Equites' Andrea Taverna-Turisan believes a listing will give investors an opportunity to participate in a quality development and management company. Image: Equites
Equites is following the lead of a number of funds looking to join the JSE's listed property sector. Last year‚ the sector saw a number of listings‚ followed by a large degree of consolidation in the first five months of this year‚ along with several additional listings.
Equites Chief Executive Andrea Taverna-Turisan said the internally managed fund was focused on high-quality industrial assets at the top end of the industrial property sector‚ with a selective exposure to office property.
Its portfolio of 17 Western Cape-based industrial and office properties includes 124‚253m² of rental space and is valued at R1.2bn. Equites is structured as a real estate investment trust (Reit)‚ a globally accepted structure adopted by the JSE in May last year.
Taverna-Turisan said the fund was excited to bring a top-quality portfolio of properties to investors.
Strong portfolio
"The portfolio properties are situated in prime locations‚ have very low vacancies with occupancy in excess of 97%‚ and at least 77% of the portfolio has leases for longer than three years‚ with healthy escalations averaging 8.1%‚" he said.
Major tenants included Simba‚ Foschini‚ Execujet‚ Digistics‚ Imperial‚ Puma‚ UTI (Adidas)‚ Avery Dennison‚ Courier-IT‚ Kuehne & Nagel‚ NGK Ceramics‚ Dole USA and Barloworld.
The fund was pursuing a private placement of shares to raise between R400m and R650m‚ with vendor participation of more than 50%.
Equites plans to development the land it owns and upgrade existing buildings.
Taverna-Turisan said the fund had an attractive pipeline of significant A-grade industrial developments and planned to expand into prime logistics zones in Gauteng and KwaZulu-Natal in the medium-term.
"With a low level of gearing of 8.3%‚ there was scope for significant yield-enhancing acquisitions financed with debt funding‚" he said. Equites was aiming to grow the portfolio to R4bn within five years.
