Listed property loan stock company Redefine Income Fund yesterday announced a first-quarter distribution of 10,3c a linked unit for the period to November 30, a 24,8% rise on the 8,25c distribution reported in the corresponding period last year.
Redefine, which has a market capitalisation of R2,8bn and property assets worth R4,4bn, said it was upbeat about its future prospects, forecasting a minimum 10% income growth for the 2006 financial year.
Redefine CEO Brian Azizollahoff said the solid performance was due to a combination of factors, including the performance of its property portfolio and the effect of its yield-enhancing fixed property acquisitions over the 12 months.
Azizollahoff said there had also been rental increases in Redefine’s portfolio. "Also expenses have been very well contained and particularly our funding costs," he said.
Azizollahoff said another contributing factor was Redefine’s disposal of a substantial amount of low-yielding listed property stock and its decision to hold onto its current high-yielding listed property portfolio.
Improved distributions from Hyprop Investments and ApexHi Properties, in which Redefine owned significant interests, had also positively affected the company.
Azizollahoff said Redefine, which has a 50-50 split between listed property and fixed property investments, had no intention of reducing its listed property portfolio at the moment.
But he said the company was now focused on growing its fixed portfolio. "We are currently in the throes of completing a number of transactions which are going to be yield enhancing and these will be announced in due course," he said.
Andre Stadler, MD of Catalyst Fund Managers, said the first- quarter distribution growth was on a par with the final quarterly distribution of Redefine’s previous financial year.
"We’re expecting Redefine to exceed its forecast of 10% growth due to its significant savings on debt funding costs and reduced vacancies," said Stadler.
Redefine was one of the top- performing companies this year, with its distributions surging 15% for the year to August.
That performance compares with average listed property distribution growth of about 7% this year.
Source: Business Day
