Zenprop drops Point project

Posted On Tuesday, 03 April 2007 02:00 Published by Commercial Property News
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Unlisted property fund has pulled out of a potential partnership with Bonatla Property Holdings in the Durban Point Development

Unlisted property fund Zenprop has pulled out of a potential partnership with listed property company Bonatla Property Holdings in the Durban Point Development.

Zenprop CEO Rodney Weinstein said on Friday that although Zenprop liked the property deal, it was "much more complicated in terms of its structure" than Zenprop was comfortable with.

The proposed timeframe for the development is three years, but "we weren't comfortable that would be achieved because of the complexity of the control structure of the deal," said Weinstein.

Niki Vontas, a consultant to Bonatla, said Bonatla had established a "major KwaZulu-Natal-based empowerment relationship which will be disclosed very soon".

As far as the Durban Point Development was concerned, Vontas said Bonatla was "going to structure the deal in such a way that we will put substantial up-front capital in place to secure the transaction".

"We also simplified the original transaction. Transactions of this nature are inherently complicated and you have to use some financial innovation to make them work because there is so much competition."

Vontas said there had been five major local and international players bidding for the Durban Point Development.

Bonatla also said that a letter of intention had been signed with a "substantial listed property company". This company had "expressed its willingness, subject to certain conditions," to acquire 50% of the entire issued share capital of the Durban Point Development Company for R150m. This would be achieved through a special purpose vehicle which would be jointly owned by the parties.

Bonatla said further information would be released in due course.

In January, Bonatla announced that Zenprop would become an effective joint venture partner with Bonatla in the Durban Point Development.

Bonatla said there was R5bn to R6bn worth of development potential on the site.

Prior to the Zenprop announcement, Bonatla said that it would be signing a deal that would see it buy effectively half the shares in the Durban Point Development. This would allow Malaysian company Renong to withdraw from SA.

The sale agreement showed that Renong would sell its entire investment in Renong SA, whose main asset was 80,4% of a company called Rocunion, to Bonatla.

Rocunion owns 100% of Rocpoint, which in turn owns half of the Durban Point Development.

Meanwhile, Bonatla said Carolyn Douglas, the owner and director of CDA Property Consultants, which is the asset manager of Bonatla, had resigned with immediate effect from Bonatla's board of directors because of a possible conflict of interest between Bonatla and CDA Property Consultants.

Last modified on Monday, 27 May 2013 18:58

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