Emira CEO James Templeton said the 10% growth in distributions to 40,10c was better than expected as the fund concluded a property deal and empowerment deal last year that was slightly dilutionary on a once-off basis.

The deal involved properties worth R844 million being acquired and empowerment partners introduced at equity level.

As Emira had bought them at a low yield and concluded the empowerment deal, management knew the combination would result in a "slight once-off dilution" to distributions.

The rise in short-term interest rates had done little to dampen the commercial property market's strength, with demand for space still strong and rentals continuing to show real growth.

Templeton said two tenants had extended their leases in existing buildings and that this would benefit the fund.

Emira had sold its Fourways Game Centre for R120 million and would be using the proceeds to reinvest in another development called RTT Warehouse, next to OR Tambo International Airport.

An industrial property being acquired for R217 milllion, was expected to be "earnings enhancing", said Templeton.

Emira is also in the process of acquiring listed property loan stock company Freestone Property Holdings.

Templeton said the Freestone transaction should be "slightly earnings enhancing after cost savings".

The transaction was expected to boost Emira's market capitalisation to about R5 billion and its property assets to about R5,8 billion. Emira's market capitalisation is about R3,9 billion and its property assets are worth R4 billion.

Templeton said the major Freestone unitholders Emira had canvassed supported the deal.