Vukile Property Fund said on Tuesday that its board of directors has, in-principle, approved the decision to internalise its asset management services, currently performed in terms of a contract with Sanlam Properties.

In this regard, Vukile and Sanlam Properties have entered into discussions with regard to the proposed acquisition by Vukile from Sanlam Properties of the IT infrastructure and software, furniture and equipment and the take-on of certain employees directly related to the asset management function of the Vukile property portfolio as a going concern, the company said.

The initial five-year period of the Vukile Asset Management Contract is scheduled to expire on March 31 2009.

But Vukile said that to allow the discussions to be concluded Sanlam Properties have in principle agreed to extend the Vukile Asset Management Contract for a maximum period of six months, as opposed to a further five-year period, subject to Vukile unitholder approval.