Competition Tribunal approval was received today for Growthpoint Properties Limited to purchase a portfolio of 48 properties from Tresso Trading 119 (Proprietary) Limited for a total consideration of R1,08 billion, at a forward yield of 11,1%.
The purchase consideration is to be settled through R810 million in cash, which will be raised by Growthpoint utilising short-term debt facilities. The balance will be settled through the issue of 43,5 million new Growthpoint linked units .
The acquisition of the Tresso property portfolio increases Growthpoint’s total asset base to over R9 billion, increasing the fund’s overall diversification of risk,” said
Norbert Sasse, CEO of Growthpoint Properties Limited, managed by Investec Property Group. “It will also increase Growthpoint’s market capitalisation to R6 billion”.
The portfolio consists of 335 792m2 of gross lettable area spread across commercial (45%), Industrial (45%), retail (7%) and other uses (3%).
“The acquisition will enhance Growthpoint’s exposure to the commercial and industrial sectors, both of which are expected to show a significant improvement over the next 12 to 36 months,” Sasse explained.
“Furthermore it will provide Growthpoint increased exposure to the Western Cape commercial, office and retail industrial sectors, all of which are expected to provide attractive returns over the medium term,” said Sasse.
49% of the Tresso property portfolio by gross lettable area is located in the Western Cape which, when incorporated into the Growthpoint portfolio, will increase its exposure to the area from 8% to 14%.
Landmark properties within the new portfolio include the prestigious Constantia Village Shopping Centre in Cape Town as well as the following well-located office space; Newlands on Main in Cape Town, Eastgate Business Park and Sandton Close 1 and 2 in Sandton and Illovo Sugar Park in Umhlanga.
Tresso is an unlisted property loan stock company formed in 2002 to house all the physical property assets of Fedsure which Investec acquired with the financial services interests of Fedsure..
Tresso’s unitholders are Investec, Investec Employee Benefits Limited, Capital Alliance Holdings Limited and Liberty Group Limited.
Growthpoint linked unitholders approved the transaction at a meeting held on 22 March 2005.
