The acquisitions will further enhance the Fund’s retail portfolio which, post the transactions, will have increased seven-fold since the end of the financial year.

Investec Property Fund CEO Sam Leon said:  “These are high-quality acquisitions that have come about thanks to the team’s longstanding relationships, experience and entrepreneurial property skills.

“They support our philosophy of growth, but not at all costs. Importantly, they enhance scale, thereby enabling the Fund to be more competitive while significantly improving the portfolio effect, which mitigates  risk, especially given the quality tenant profile of the acquisitions.”

The Giuricich Portfolio:

This transaction will see The Fund acquire a quality portfolio of 12 retail properties from S.Giuricich Holdings Pty Ltd for R742.8 million, a through yield of 8.3%. The properties, which are situated in prime locations in and around Gauteng, Polokwane, Pretoria and Bloemfontein, have a 95% national tenant profile. These include Builders Warehouse from the Massmart stable, PG Glass, Tiger Wheels, McCarthy VW and Nissan and Honda dealerships from the Super Group Stable as well as Ellerines Group and Wetherleys.

“We have been impressed with the performance of the Investec Property Fund since its listing last year. We have a trusted relationship with the Fund’s management and see this as a good investment.  We believe that the fund will continue to acquire and grow quality assets,” said Giuricich director Luigi Giuricich.

The Giuricich portfolio will be funded through a combination of equity, existing debt facilities and the issue of new Investec Property Fund linked units to Giuricich.   

"We are grateful that the S. Giuricich directors have entrusted us with an excellent portfolio built up over many years and that they are staying with us for the ride by becoming significant shareholders," said Leon.

Transfer of the properties is expected by mid-October 2012.

MegaMark Mall:

A further enhancement to the Fund’s retail portfolio is the purchase of the MegaMark Mall in Kriel, Mpumalanga from Ivory Pewter Trading.  The R218 million acquisition, with a forward yield of 9.02%, will be funded by debt, with transfer expected by 1 December 2012. 

The Mall is the dominant retail facility in Kriel, Mpumalanga, in the heart of the coal mining and power station district, with an economy driven by Eskom’s ongoing coal-based infrastructure expansion plans.  Prominently located in Kriel, the 20 000m2 property is anchored by Shoprite and Spar and is 75% occupied by national chains including Foschini, Edcon, Pep and Mr Price group brands, Ellerines, JD and several major banks.

The Firs:

A trophy asset for the Fund is the acquisition of The Firs from Investec Property for R272 million, with an attractive initial return of 8.75%. The acquisition, to be funded through a combination of equity and debt, will enhance the Fund’s portfolio quality and with Rosebank emerging as one of Gauteng’s most powerful nodes, it is expected to enhance earnings over time.

Acquired in 2006 and redeveloped by Investec Property, The Firs has emerged as a fashionable meeting place in Johannesburg’s sought-after Rosebank node, with the centre and outdoor piazza being home to some of the northern suburbs’ most popular and up-market restaurants and specialist destination stores.  In addition to a retail level with specialised boutiques, the centre includes A+ Grade offices.  The 13 800m2 property, which is fully let, adjoins the five-star Hyatt Regency and is in close proximity to the Rosebank Gautrain Station.

Disposal of Pretoria Office Property:

As part of the effective management of the portfolio the Fund has entered into an agreement for the sale of an office property in the Pretoria CBD, fully tenanted by Local Government, The property, now considered non-core, was sold R153.5 million.

All transactions are subject to certain conditions, including regulatory approvals and unitholder approval where relevant.   

Assuming all announced transactions are concluded, the portfolio split by value will be:

• Retail: 42%
• Office: 35%
• Industrial: 23%