CIREF delays projects after R400m loss

Posted On Monday, 24 November 2008 02:00 Published by
Rate this item
(0 votes)
UK-based property fund CIREF, which has a significant SA shareholding, reported a net loss of more than R400m in a depressed UK property market.

Loyiso Sibali

Property Reporter

UK-BASED property fund CIREF, which has a significant South African shareholding, reported a net loss of more than R400m in a depressed UK property market.

The company said on Friday it had to put certain developments on hold since banks had become more stringent on lending because of the credit crisis.

Gavin Tipper, chairman of CIREF, said the de-rating of property as an asset class in the UK might lead to a number of companies failing, but he was confident that CIREF would weather the storm.

CIREF, which is managed by Corovest International’s property fund, is listed on the London Stock Exchange’s AIM Market. On Friday it reported a net loss of R406,6m for the year to September, compared to a net profit of R76,3m in the previous year.

The net loss per share was R5,76 for the year-end. The net asset value per share fell 25,8% to R17,52.

Mike Watters, CEO of Corovest International, said certain development projects had been put on hold until stability returned to the markets.

The credit crisis had negatively affected the market, prompting banks to restrict lending. He said the company’s healthy cash position was a major advantage and that the group would continue acting defensively to conserve cash and reduce expenditure.

The group ended the year with a positive net cash position of R281m.

Watters said he was positive about future market performance in the wake of the Bank of England cutting interest rates by 150 basis points.

“The expectation of further interest rate decreases is expected to buoy property yields. Once markets normalise, the group is well placed to pursue acquisitions using the lower interest rate environment to our advantage,” said Watters.

Source: Business Day


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

Most Popular

Repo rate unchanged at 3.5%

Mar 25, 2021
Lesetja_Kganyago_SARB_Governor
The Monetary Policy Committee has decided against altering the repo rate, deciding to…

Park Village Auctions brings to market a well Designed Factory with Offices

Apr 05, 2021
Default Image
Park Village Auctions brings to market a well Designed Factory with Offices

The Business Exchange announces new Dollar-based investment opportunity for South Africans

Apr 06, 2021
David_Seinker_CEO_The_Business_Exchange
Serviced office space provider The Business Exchange (TBE), in partnership with Maxcity…

Absa partners with Amdec Group to bring iconic Harbour Arch development to fruition

Mar 30, 2021
Harbour _Arch_Context
Absa Bank has partnered with Amdec Group, South Africa’s leading developer of new urban…

Growthpoint completes Cintocare Hospital development - the first of its kind for Africa

Apr 06, 2021
Street view of the Cintocare Hospital
A 11 000 sqm specialised surgical hospital development by Growthpoint Properties (JSE:…

Please publish modules in offcanvas position.