Martprop records profit as group retains leases.

Posted On Friday, 29 August 2003 02:00 Published by eProp Commercial Property News
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 Property unit trust group Martprop Property Fund reported positive financial results yesterday in a market which showed unrelenting pressure on earnings. 

Len van NiekerkMartprop, which is managed by Marriott Property Fund Managers, reported a 2,1% increase in its distribution for the year ended July 31. The directors of the management company announced a final distribution of 12c for each unit, bringing the total distribution for the year to 24c for each unit compared with 23,5c last year.

 Martprop MD Roger Perkin attributed the results to the fact that they had managed to retain the majority (more than 90%) of the leases which were either due for expiry or subject to market reviews.

 "If one looks at the leases that expired this year, quite a few of the leases were with Grindrod and those were all strategic warehouse facilities close to the harbour. They're on Maydon Wharf, which is a prime area from a harbour point of view and all the properties have wharf frontages. This makes them attractive and very valuable," Perkin said.

 Martprop, which is predominantly industrially focused with 69% of its property portfolio in this sector, where there had been a good pick-up in occupation and an improvement in rentals.

 The fund also reported a 36,1% increase in net profit for each unit. Net profit for each unit moved to 23,15c from 17,01c last year. Net headline earnings for each unit rose 3,1% to 23,55c from 22,83c last year. Revenue was up 11% at R196,2m from R178,6m last year.

 Perkin said in terms of Martprop's investment strategy they were looking to grow the fund "aggressively" and increase their Gauteng exposure.

 There were plans to increase the retail component which was 16% of their portfolio. "Retail has proven a far more resilient investment when market conditions are tough," Perkin said.

 Martprop was in a good position to grow the fund as their borrowings were low, sitting at 5% of the property value at the moment. Property unit trusts can now have borrowings of up to 30% and Martprop had a loan facility of R284,3m from July 31.

 Andisa Securities property analyst Len van Niekerk said the fund's results were "bang on" his expectations. He said Martprop was well positioned around the Durban area.

       
 

Last modified on Saturday, 10 May 2014 10:26

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