S.Africa's Growthpoint to sell assets worth $153 million

Newriver Reit

28/11/2024 12:29

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      Plans to sell assets worth 2.8 billion rand 
    

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      Will invest 2.2 billion rand in core portfolio
    

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      Maintains 2-5% decline in DIPS for FY25
    

  
       JOHANNESBURG, Nov 28 (Reuters) - Growthpoint Properties
 GRTJ.J , South Africa's largest commercial property owner, said
on Thursday it will sell assets worth 2.8 billion rand ($154
million) in the year to June 30, 2025, as it focuses on its core
South African portfolio.
    It aims to "decrease our exposure to the office sector,
disposing of older industrial assets and selling non-core retail
assets in deteriorating central business districts (CBDs)", the
group said in a trading update for the three months ended Sept
30.
    Growthpoint sold five properties for 404.8 million rand
during the quarter to simplify its portfolio and lower its
loan-to-value ratio. 
    In September it also agreed to sell its 69% stake of its
unit UK-based unit, Capital & Regional (C&R) to a UK property
owner NewRiver REIT.
    NewRiver REIT offered to buy all issued and to-be-issued
shares in C&R for 147 million pounds or 62.5 pence each.
    The real estate investment trust (REIT) maintained its
guidance of a 2% to 5% decline in annual distributable income -
a primary measure of profit for REITs - citing an operating
environment hurt by high interest rates.
    Group vacancies fell to 8.2% from 8.7% driven by strong
leasing activity in its office and logistics segments, while the
retail sector saw a rise reflecting non-renewals in its Gauteng
portfolio.
    The company said it intends to increase investment in
logistics and retail, particularly in the Western Cape where
there has been an influx in tourism.
    It said it will focus on improving retail assets focusing on
the coastal regions particularly its V&A Waterfront precinct
which it expects to benefit from improved tourism post COVID.
    ($1 = 18.2385 rand)

 (Reporting by Sfundo Parakozov; editing by Jason Neely)
 ((Sfundo.Parakozov@thomsonreuters.com;))