Pangbourne unveils Siyathenga fund

Posted On Friday, 01 July 2005 02:00 Published by eProp Commercial Property News
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PANGBOURNE Properties said yesterday that it would list a specialist retail fund, Siyathenga Property Fund, on the JSE Securities Exchange SA.

Property-Housing-ResidentialPangbourne CEO Athol Campbell said there would be a rights offer for its own unitholders to acquire a 57% interest in Siyathenga.

Pangbourne will take a 43% interest in the new fund and manage it, earning fees.

"The creation of Siyathenga is a continuation of Pangbourne’s strategy to develop specialised, differentiated property portfolios that deliver to our sustainable growth in distributions," Campbell said.

Pangbourne also manages and owns a 47% interest in iFour, which owns A-grade or new properties with long leases.

Campbell said industrial stocks such as Pangbourne tended to trade at higher yields than retail funds.

"Retail is the flavour of the month and retail-focused funds have done well.

"(The new fund) also offers our shareholders a choice. If they like Pangbourne management but prefer retail, they now have the choice to invest in this new retail fund."

Siyathenga will be listed on the JSE on August 5. It will initially have assets worth R800m and its three flagship properties are Crescent Shopping Centre in Umhlanga Ridge, Durban; Pineslopes Shopping Centre in Fourways and Willowbridge, a new centre opening in Tyger Valley, Cape Town, in October.

First South Securities property analyst Leon Allison said a key reason Pangbourne was doing the deal was to generate "recurring property and asset management fees". "(Pangbourne) can also in future, when bulking up portfolios for iFour and Siyathenga, earn facilitation fees," said Alison.

He said Pangbourne management had a history of looking at other sources of income rather than just pure lease income from its own property portfolio.

"The management fees provide an annuity income stream.

"There is less volatility and therefore less risk."



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