Single-tenanted long-term leases in the UK should protect Texton Property Fund from volatility in the region, Nic Morris, the group’s new CEO, said on Thursday.
Texton has diversified into the UK over the past few years. Its strategy is to sign up as many large single tenants on long leases as it can. This protects it from the short-term weak economic growth or decreasing valuations in UK assets because of events related to Brexit.
Investors would be able to receive consistent pounddenominated income streams from Texton’s UK assets and regular dividend growth from its South African properties.
Texton’s portfolio is geographically split by value between the UK, accounting for about 40%, and SA, with about 60%.
“Our strategy aims to provide investors with secure and robust income streams and attractive dividend yields through exposure to solid long-term leases with excellent tenants.
“Texton remains focused on increasing the average value of its properties through enhancing its core portfolio and disposing of smaller noncore assets.
“Texton will continue with the reduction in government exposure and secondary office exposure with a view to moving closer to a balanced portfolio across the UK and SA.”
Morris joined Texton as chief operating officer in January and was promoted to MD in September. He took over as CEO after the resignation of Angelique de Rauville. He was CEO of Arch Property Fund, after leading the real estate advisory team at Rand Merchant Bank. He is a certified chartered accountant and holds a BCom from Stellenbosch University and a BCom (Hons) in accounting from the University of KwaZulu-Natal. He completed a postgraduate diploma in real estate at the University of Cape Town in 2012. De Rauville remains a major shareholder in Texton.
The share of Texton’s portfolio that is invested in the UK 60%. The share of the property group’s portfolio that is invested in assets in SA.
source: Business Day