With Hyprop Investments’ R9bn take over of unlisted Attfund finally in the bag — the deal becomes effective on September 1 — it could be an opportune time for the shopping centre owner to push for an asset swap or take over of Sycom Property Fund.

Hyprop, whose market cap will swell to R13bn after the Attfund merger, is not only acquiring regional malls like Clearwater in Roodepoort and Woodlands Boulevard in Pretoria from Attfund, it will also inherit Attfund’s 8,9m Sycom shares.

That will take Hyprop’s stake in Sycom from 34,8% to 39%, allowing Hyprop to make an offer to minorities. The only spanner in the works is Acucap Properties, which has a 20% stake in Sycom and owns Sycom’s management company.

Acucap is unlikely to want to let go of Sycom. But the market is growing impatient with the stalemate that has been created by the cross-shareholding among the three property counters. Sycom’s performance, both in terms of income and share price growth, has been lagging its peers. There is a view that Hyprop, under CEO Pieter Prinsloo, may be able to unlock value for Sycom shareholders.

But if Hyprop can’t effect a buyout or an asset swap of sorts, then perhaps it’s time to cut the ties and sell its R1,72bn stake in Sycom. Hyprop paid R19,70/share for the bulk of its Sycom shares in mid-2007 and the stock was trading at a marginally higher R20,50/share last week, so a big loss is not on the cards.

That would at least pave the way for what should be a friendly merger between Sycom and Acucap. A tie-up of these two counters, which together own more than 500000m² of shopping centre space, including Vaal Mall in Vanderbijlpark, Somerset Mall in Somerset West, Festival Mall in Kempton Park and Keywest in Krugersdorp, would create a R10,5bn retail-focused fund.

The addition of another R10bn-plus fund to the R134bn listed property sector will no doubt further raise the status of real estate as an asset class.