Calulo Property Fund increases portfolio

Posted On Wednesday, 16 March 2005 02:00 Published by Commercial Property News
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Calulo Property Fund Limited is now to be launched as South Africa's first fully integrated, black empowered property fund

 Richard HarmanCalulo Property Fund Limited, which last year acquired 95.5% of semi-dormant JSE Securities Exchange-listed Annuity Property Fund Limited, is now to be launched as South Africa's first fully integrated, black empowered property fund.

This week it confirmed an earlier announcement that it is to inject 16 additional properties into its portfolio. The resultant portfolio has been independently valued at some R375 million.

The purchase price of the properties, including an existing Cape Town warehouse it is acquiring from a subsidiary company, is some R371.2 million. With acquisition costs of R12.5 million, the total acquisition costs amount to R383.7 million.

The equity portion of of the purchase price will be R155.7 million with the balance to be raised by way of debt, providing a ratio of 40.5% equity to 59.5% debt.

Rand Merchant Bank will be providing the debt funding to finance the cash portion of the property acquisitions with all the equity, in the first instance, being issued to the vendors.  However, to date some R120 million worth of the vendor units have been privately placed with institutional and private investors.

The fund's CEO, Richard Harman, says: "The balance of the additional vendor units will provide some liquidity on listing. A number of institutional investors have, however, expressed interest in acquiring some of these units but their internal controls require them to have reviewed the published circular before committing to purchase."

The properties being injected into the fund are located largely in Gauteng and the Eastern and Western Cape.

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