Vividend bulks up portfolio with Liberty Towers acquisition
PROPERTY loan stock company Vividend Income Fund said yesterday it had reached an agreement with Golden Pond to acquire the Liberty Towers property in Durban for R303,5m as part of a strategy of identifying and acquiring properties with good cash flow.
Vividend, which listed two years ago, said the acquisition provided adequate value enhancement to linked unitholders.
The fund said the Liberty Towers acquisition also provided further quality, stability, longevity and growth potential to its earnings by introducing a well-established landmark property with a high level of blue-chip medium-term leases into its lease profile.
Vividend said it would fund the purchase through a combination of debt financing and new equity raised from new and/or existing linked unitholders. Last month the fund acquired two Sasol-owned properties and associated letting enterprises in Randburg for R155,6m from Sasol’s pension fund.
The properties were at 272 and 316 Kent Avenue, Ferndale, Randburg. The company said in April that it continued to actively manage the risks and opportunities associated with its portfolio income by proactively enhancing the quality of the underlying properties through a targeted refurbishment and repositioning programme.
Vividend has done well since listing because of its focus on smaller, high-yielding properties such as Clearwater Crossing in Roodepoort and Montclair Mall in Durban.
The fund listed two years ago with a market capitalisation of R500m. Though it initially listed with only one property in its stable, management has since made headway in bulking up the portfolio. Vividend, which is still relatively small, is starting to look a lot more interesting now that it has nearly doubled its portfolio to 19 properties worth about R1,32bn.
The fund has made progress in creating a high-quality, stable and well-diversified portfolio, which has positioned it to take advantage of leveraged acquisition opportunities in the market.
