Rebosis wants to grow to R10bil

Rebosis Property Fund (REB)‚ a substantially black-held property company‚ which listed on the JSE last year‚ announced an effective 12.1% increase in distributable earnings per linked unit for the year ended August 31‚ compared to the annualised distribution last year.

CE Sisa Ngebulana said that amid difficult market conditions‚ the company had an “excellent year”‚ and that Rebosis would not deviate from its strategy‚ remaining focused on aggressively growing its portfolio.

Over the medium term‚ Rebosis intended to grow the fund to R10bn in the next five years‚ from the year-end value of R4.54bn.

Rebosis’s portfolio consists of three shopping centres and nine office building properties‚ which are mainly let to government tenants.

The low vacancy rates‚ high asset growth‚ and retail turnover growth of 15% were all well above the sector average‚ and Rebosis saw this trend continuing‚ Ngebulana said.

“The retail component posted turnover growth of 15%‚ outperforming national sales growth numbers‚ whilst our commercial offices remained shielded from economic impacts as it’s mainly let to national government departments‚” Ngebulana said.

The fund’s total return for the year was 31.5%‚ comprising an income return of 8.7% and a capital return of 22.8%.

During the year‚ Rebosis continued its acquisition drive and acquired the Bloed Street Mall at a cost of R341.5m‚ while four office buildings were acquired between June 29 and July 31 this year for a consideration of R519m.

Rebosis planned to undertake redevelopments and upgrades in the current financial year while maintaining an aggressive acquisitive growth strategy “aligned with its investment criteria of dominant regional malls and large commercial offices leased by blue chip tenants”‚ the company said.

Ngebulana said however that the increased competition for the same assets could lead to inflated asking prices “and we are very aware of that”.

“We won’t enter into a bidding war for the sake of growing the portfolio‚” he said.

Rebosis has right of first refusal on Billion Group developments including Forest Hill in Centurion and Mthatha Mall and Bay West City in the Eastern Cape‚ which Ngebulana said would increase the fund’s retail makeup to two-thirds of the overall portfolio‚ as part of its strategy to maintain its retail focus.

“With our first year of trading as a listed company completed‚ we remain well positioned for future growth and acquisition opportunities that will add value to our current investment profile.

“Vacancies have reduced‚ arrears have been contained and demand for premises remains strong‚ Ngebulana said.