Phoenix scouting for undervalued property

Posted On Wednesday, 10 June 2009 02:00 Published by Commercial Property News
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With listed property shares trading at 20%-30% of 2007 prices, there are real opportunities for investors to acquire meaningful stakes in undervalued companies.

WITH listed property shares trading at 20%-30% of 2007 prices, there are real opportunities for investors to acquire meaningful stakes in undervalued companies, says UK based Phoenix chairman Jim Shankland.

But, he says, it takes an impeccably timed venture, with an exceptional executive team, to leverage opportunities in a global economic downturn.

Phoenix, the international investment arm of SA-based Madison Property Fund Managers, is being listed on the Bermuda Stock Exchange towards the end of this month to take advantage of undervalued property portfolios in key global marketplaces.

“Phoenix is already scouting opportunities throughout the UK, continental Europe, Australia and even the US,” Shankland says.

Phoenix’s investment objective is straightforward, he says. “We expect to achieve a 30% annual compound return and intend to reassess the situation in five years’ time. At that stage, we will decide whether or not to sell out, or to continue with our investment strategy.”

Shankland, the former MD of Ryden Property Consultants in the UK and past chairman of RICS Scotland, says taking Phoenix global and achieving that attractive return may sound like an ambitious goal, but it lies in solid hands.

During the property crisis of the early 1990s, he focused on turning around distressed UK assets, experience which he hopes will serve him well in this venture. He also conducted a year-long review of Cape Town’s V&A Waterfront for Transnet in 1996.

Since 2005, Shankland has been focusing on private equity property syndicates.

The executive team of Phoenix includes doyens of the SA property industry such as former Liberty Life Properties MD Wolf Cesman; former head of Anglo American Property Services and current CEO of ApexHi Properties Gerald Leissner; and property deal maker Marc Wainer, foundeder of Investec Property Group.

The team also includes Mike Flax, who founded Spearhead and turned it into the top-performing listed property stock on the JSE before selling it. Flax will lead the Phoenix management team on a full-time basis.

“The management team will personally be big investors in Phoenix, something that should create enormous confidence among other investors,” says Shankland.

“We believe that Phoenix presents a once-in a-generation opportunity to capitalise on worldwide market recovery, and we believe others will agree.”

Madison is SA’s South Africa's largest JSE-listed property asset manager responsible for the management of three highly differentiated loan stocks — ApexHi Properties, Redefine Income Fund and Hyprop Investments. Madison is set to merge with Redefine and ApexHi, with only the final statutory requirements awaiting fulfillment, to become SA’s second-largest listed property fund.

Last modified on Tuesday, 04 June 2013 08:52

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