Listed property loan stock company Growthpoint Properties says its recent acquisition of City Mall shopping centre in Klerksdorp in North West is yield-enhancing.

CEO Norbert Sasse said yesterday that the R105m acquisition was made at an estimated forward yield of 10,35% and that the funding of the deal would be cheaper than the initial yield.

The fully let 18197m² City Mall is situated in the central business district in Klerksdorp.

Sasse said the centre, 80% of which has been let to national retailers, offered "reasonable value". It was the dominant shopping centre in the Klerksdorp area, and was "underpinned by long-term leases".

This is the third major property deal that Growthpoint has concluded in the past year.

In December last year, the company said it was acquiring a portfolio of 48 properties from Tresso Trading 119 for a total R1,08bn on a forward yield of 11,1%.

Last month, Growthpoint bought the Healthcare Park office building in Woodmead, Johannesburg, for R65m.

Growthpoint, the biggest property fund on the JSE, now has assets worth about R9,6bn, with the retail portion of its portfolio amounting to R4, 3bn of this total.

"City Mall fits the investment criteria while improving Growthpoint's exposure to the buoyant retail property market in Klerksdorp," said Growthpoint retail fund manager Stephan le Roux.

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Publisher: I-Net Bridge
Source: I-Net Bridge