Institutional listings will boost property board.

Posted On Wednesday, 20 August 2003 02:00 Published by eProp Commercial Property News
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Pretoria - The listed property sector was expected to gain vigour because of expected new institutional listings by Old Mutual, Sanlam, Absa and RMB Properties later this year and early next.

Angelique de RauvilleAngelique de Rauville, the managing director of Provest, the wholly owned property asset management subsidiary of Investec Bank, said at the weekend the listed property sector was likely to continue dominating new listings in the next 12 months.

Existing property unit trusts and property loan stock companies were expected to continue growing their assets. "Acquisitions are earnings enhancing and this is expected to filter through to distributions. Over the past couple of years, growth in earnings has been fairly pedestrian. Going forward, this is likely to change," she said.

Colin Young, Old Mutual Properties' executive for listed property, confirmed that Old Mutual wanted to list some of its properties, adding that the listing would occur before the end of this year "if all goes well".

Young said there was an opportunity with interest rates coming down but that window might not be longer than a year.

He said the fund to be listed by Old Mutual was likely to contain a blend of good property assets but not its "absolute gems".

"Old Mutual Properties will only list a quality fund to get one of the top ratings. The tenants, vacancy profile and location [of the properties] will all need to be superb. It they don't meet that criteria, they won't get selected," he said.

Young added that it was positive that institutions were looking at property listings and hopefully "the start of a big growth phase".  

Barnus van der Walt, the managing director of Gensec Property Asset Management, which manages Sanlam's property assets, was unavailable for comment on its listing plans.

However, De Rauville said Sanlam were on schedule to list "certainly one and potentially a second fund" and the proposed listing date was the first week of in October.

De Rauville said the properties in Sanlam's funds were expected to include many of the properties that were in the portfolio of Cupar, whose proposed listing last year was cancelled due to unfavourable market conditions.

She said the Absa listing was a joint venture with Durban-based Marriott, who would have a 50 percent stake in the asset management company and handle the bulk of the property management of the portfolio.

De Rauville said Absa's fund would be another hybrid property loan stock including R270 million of listed property unit trusts and property loan stocks, with most of these holdings currently with Absa.

The R614 million physical property portfolio would comprise 47 A-grade and B-grade properties, the proposed listing date was October 1 this year and it was likely the capital-raising requirements would be about R218 million.

De Rauville said RMB Properties was expected to come to the market in September this year with a new listing, Momentum Property Investments, with the total portfolio comprising 66 properties valued at R1.3 billion.

Last modified on Saturday, 10 May 2014 12:13

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