Attacq diversifies to embrace Europe
Johannesburg - Listed capital growth property company Attacq is poised to expand its operations into central and eastern Europe.
Morné Wilken, the chief executive of Attacq, said yesterday that its investment in Cyprus was part of a broader strategy by the group to expand into central and eastern Europe. He said it was looking at a number of opportunities in this region, but nothing had been concluded yet.
“It’s quite well advanced and so it will happen in the next few months,” he said.
Attacq, in partnership with the Atterbury Group, last month announced the acquisition of a 48.75 percent stake in the Shacolas Emporium Park and The Mall of Engomi for €195 million (R2.93 billion).
Wilken said the acquisition in Cyprus was a unique opportunity because it was at the bottom of the market when the group did the acquisition and its investment had seen positive growth since then.
He added that Attacq had exited from its investment in the Mall of Mauritius at Bagatelle and deployed that cash into Cyprus, which was a euro denominated country.
“You are in a hard currency and that is quite beneficial to us (Attacq),” he said.
Wilken said it wanted to get a balance between Attacq’s investments in South Africa, emerging markets and in developed markets to mitigate risks.
“Two years ago everyone was running to Africa. Look at what is happening in China now. We don’t know what is going to impact and the only way can mitigate that risk is by diversifying. The emerging markets give you that extra growth and developed markets a lot of stability,” he said.
Net asset growth
Attacq yesterday reported a 20.6 percent growth in net asset value to R11.9bn from R9.9bn in the previous year. Adjusted net asset value a share grew by 17.9 percent to R18.98 from R16.10 in the same period. Net rental income increased by 47.6 percent to R954.1m from R646.6m.
Its total asset value increased by 26.2 percent to R23.3bn from R18.5bn as the size of its portfolio grew by 45.1 percent to more than 565 000m² of investment grade commercial real estate.
Attacq’s share price grew by 25.3 percent during the year, increasing its market capitalisation to R16.6bn at year-end.
Wilken attributed this strong performance to healthy income growth in Attacq’s core portfolio, the performance of MAS Real Estate, in which Attacq has a 45.3 percent shareholding valued at R2.2bn, and the ongoing delivery of its development pipeline. He said Attacq completed 13 new developments during the year.
Its flagship South African development is the 323 hectares mixed-use Waterfall development in Midrand, with the R4.8bn 131 000 square metre super regional mall set to open in April.
Wilken predicted the opening of the mall would be “a game changer” for Attacq and drive the next wave of development at Waterfall City as it continued to develop the remaining 775 000m² of usable bulk over the next 10 to 15 years.
He said ongoing diversification in South Africa and abroad plus offshore development opportunities would be two of Attacq’s key focus areas in the year ahead, along with developing out Waterfall City, investing in local opportunities outside of Waterfall and recycling capital to achieve the best growth.
Shares in Attacq dropped by 1.47 percent on the JSE yesterday to close at R22.81.