PRETORIA – Listed Investec Property Fund (IPF) is to deploy a further €7 million (R113.46m) into the investment in its unlisted Pan-European logistics portfolio in the current financial year, to support the acquisition of two logistics properties in France and Poland.
IPF made the initial €71.9m investment into the portfolio between May and the end of September.
Nick Riley, the chief executive of IPF, said yesterday the investment had outperformed the initial acquisition budgeted income return of 10.5 percent, delivering an 11.2 percent income return (11.6 percent in rand) in the six months to September, because of stronger leasing activity than initially forecast.
Riley said the underlying properties in the portfolio were externally revalued in September, resulting in an increase in direct asset value of 7.4 percent and an increase in the fund’s investment of 13.9 percent (14.7 percent in rands).
He said the returns from the planned acquisitions in France and Poland were in line with those of the initial transaction and would be part funded with euro-denominated debt.
“The fund believes this investment platform offers shareholders the best risk-adjusted return based on the current universe of opportunities, and will continue to deploy capital into this strategy.”
The investment in the logistics portfolio increased IPF’s offshore exposure to 13.7 percent, in line with its core objective of increasing its offshore balance sheet exposure to 20 percent.
IPF reported a 5.4 percent growth in interim dividends a share to 68.81c from the normalised 65.27c in the prior period. Riley said IPF expected to deliver normalised distributions a share growth of between 5 and 5.5 percent for the year to March.
IPF shares rose 0.71 percent to close at R15.66 on the JSE on Tuesday.