Atlas is set for earnings growth

Posted On Monday, 02 December 2002 10:01 Published by eProp Commercial Property News
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Property investment holding group Atlas Properties is set for a ninth consecutive increase in earnings, says the group's MD, Ian Raubenheimer.


Property-Housing-ResidentialThis makes the group one of the best-performing property investment holding companies on the JSE Securities Exchange SA in terms of earnings growth.

Harsh market conditions, made worse by the oversupply in the commercial property sector, have curtailed earnings growth for many listed property companies over the past few years.

Atlas has been producing compounded yearly returns of about 21% since 1993 when Atlas Property Services took over management of the group's portfolio.

Raubenheimer said the group's secret lay in the decision to maintain in-house portfolio management as opposed to having an independent management company, as was the case with many other listed property holding companies.

These independent asset managers offer their management service at a fee.

Raubenheimer said many of these independent asset managers were interested in the management fee and not the welfare of the portfolio.

'And, in any way, the management fee comes off the bottom line,' said Raubenheimer.

Atlas chairman Peter Irving said: 'Our company structure is part of the success story. It gives Atlas an edge over other similar companies.'

In the past year, the group bedded down a number of acquisitions, including a R400m acquisition of property company Advent. These acquisitions left the group with a property portfolio valued at about R780m.

The portfolio reflected a 63,3% exposure to Cape Town, 21,7% to the northern Johannesburg market, and 12,6% to Durban.

About 50% of the portfolio was made of retail property and 44% was office property.

Industrial property accounts for only 3,6% of the total portfolio, while 1,8% was vacant land.

Raubenheimer said the group had taken a strategic exposure to the Cape Town market because it believed Cape Town has better growth potential.

Last modified on Saturday, 26 April 2014 10:12

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