Redefine Properties today announced two significant events that advance its growth strategy. Redefine has agreed to acquire a portfolio of 28 industrial properties from leading steel supplier Macsteel for R2.7 billion with a 12 year triple net lease. It has also secured a lease with IBM South Africa for approximately 10,300 m2 of offices in Redefine's newly completed green office building at 90 Grayston Drive, in Sandown, central Sandton. Commenting on these transactions, Marc Wainer, Executive Chairman of Redefine Properties, says: "These deals further our objective of accommodating leading businesses in a diversified portfolio of larger property assets with low-risk, high-quality, inflation-beating income streams." Wainer notes: "We are pleased to add Macsteel and IBM to Redefine's stellar list of quality tenants." The Macsteel transaction represents an attractive initial yield of 8.7% for Redefine that escalates at 8% per annum, with a further five year renewal option. The Macsteel portfolio covers a total rentable area of some 560,000 m2, with a small office component of around 12% of this area.The buildings are located across eight of South Africa's provinces, with 75% of this space concentrated in Gauteng. "This transaction will transform Redefine's industrial portfolio, increasing it from approximately R5 billion to R7.7 billion, lifting the weighted average lease period from 2.5 years to 5.5 years and will bolster the defensive component of the portfolio," added Wainer. This acquisition boosts Redefine's exposure to industrial property, better balancing its diversified commercial property portfolio. The Macsteel acquisition is subject to approval by the competition authorities and is expected to be effective by 1 November 2014. At Redefine's newly redeveloped premium-grade 90 Grayston office property, IBM will occupy (from 1 April 2015) just more than 55% of the 16-storey building on a 10-year lease.A further 1 500 m2 has also been let resulting in confirmed occupation of 66%. Strategically placed in the heart of Africa's business hub, Redefine's redevelopment of this property has earned it a Green Building Council of South Africa 4-Star Green Star SA rating which has positioned it among South Africa's most innovative and recognisable buildings. "90 Grayston is ideally suited to multinational businesses like IBM and will provide it with many unique advantages. This building is now de-risked and is one of Redefine's largest office developments to date and is tailored to meet our portfolio strategy."concluded Wainer.
The offer by Redefine Properties to acquire the assets of Fountainhead Property Trust fell somewhat short of the required 75% consent from Fountainhead unitholders at a general meeting this morning. The acquisition by Redefine and the subsequent winding-up of Fountainhead will therefore not be implemented.As a related party, Redefine was unable to vote its majority stake in Fountainhead. Andrew Konig, CEO of Redefine, commented: "Although there was a high level of voter support for the transaction, above 71% but it fell short of the 75% required. While we are disappointed by the result, it was not a completely unexpected outcome due to the fact that Fountainhead had been trading above the swap ratio since the transaction was announced. In addition, Redefine could not vote its majority stake, which amplified the support required to achieve the approval threshold. "An unfortunate consequence of this outcome for Fountainhead is that it will have to absorb transaction costs of R7.3 million." "As far as we are concerned it is business as usual going forward for both Fountainhead and Redefine."
The partnership between Buskaid Soweto String Project and Redefine Properties won the Development category of the 17th Annual Business Day BASA Awards announced last night. The awards are presented by Business and Arts South Africa (NPC) in partnership with Business Day and Hollard. They recognise and promote excellence and innovation in business support for the arts. Buskaid helps young black musicians in South African townships. Currently, there are around 115 children and young people enrolled in the Buskaid Music School and many more who dream of joining.In addition to providing a musical education, it promotes life skills, knowledge transfer, as well as full- and part-time employment to 35 dedicated performers and teachers. "We are thrilled that Buskaid's incredible work has earned such an esteemed recognition," says Marijke Coetzee, Redefine Properties' Head of Marketing and Communications. "Buskaid provides so much more than a music education, it shares life skills and opportunities for disadvantaged children to become tomorrow's leaders. It gives its young members a brighter future. We are proud to be associated with Buskaid." This far-reaching partnership supports Buskaid's vision that all township children will be given the opportunities to channel their creative energies and talents through learning and playing classical music to the highest international standards. Redefine, Buskaid's major sponsor, has played a key role in supporting its teaching and its growth. The seeds for Buskaid were first planted when British viola player Rosemary Nalden MBE, founder of Buskaid and Director of the Buskaid Music Academy in Soweto, heard a BBC radio interview in 1992 highlighting the difficult plight of young string players in Diepkloof. Compelled to take action, she enlisted a support of 120 of her professional colleagues who took part in a simultaneous 'busk' at 16 British Rail stations to raise money. She had no idea that by doing this she would come spend to so much time in South Africa to pursue her passion.Unfolding from Buskaid, Rosemary responded to requests from the local Diepkloof community and established the Buskaid Soweto String Project in 1997 to develop musical talent and the gift to perform in disadvantaged children from the area. "Buskaid has enjoyed a fruitful partnership with Redefine over several years. Even when the company went through a major merger and changes, their support has being steadfast, generous and grown," says Rosemary."This continued sponsorship has allowed Buskaid to provide an ongoing, sustainable and growing development programme. Redefine is at the heart of the project's collaborative community of sponsors." Marijke, who oversees the Redefine's CSI initiatives, believes it's important to have a good idea of the real needs of a project, and has gained a greater understanding of how Redefine can support Buskaid by visiting the school and connecting with its young musicians. From these visits and discussions several exciting projects and new focuses have emerged, including Buskaid's successful 10-day UK tour in July 2014. With sold-out performances and standing ovations wherever they went, Redefine sponsored a tour of the UK for the young musicians of The Buskaid Soweto String Ensemble. Marijke says: "This sponsorship was a natural extension of our continuing support of Buskaid." Under the Redefine banner, these young ambassadors showcased the talent and potential of our country and their flair for performing on an international stage in five concerts, delighting audiences with classical pieces, pop songs and township jives. The tour culminated in a flash-mob performance in London's bustling Trafalgar Square on Nelson Mandela International Day on 18 July, making international news headlines (see the video on Buskaid's YouTube page). "Through Redefine's sponsorship of, and work with, Buskaid, we actively make a positive contribution to our communities and the arts, for now and for the future," says Marijke. "By creating new horizons for its members, Buskaid inspires residents of Soweto, music lovers from across South Africa and audiences around the world." Buskaid's annual concert, sponsored by Redefine, takes place on Saturday, 6 September 2014 at the Linder Auditorium, St Andrews Road, Parktown at 7.30pm, and is set to inspire, delight and move audiences with a musical and visual showcase bursting with talent and featuring a wide range of music. Tickets are available from Computicket and more information can be obtained from Anne Bull at Buskaid on 011 442 9676 or www.buskaid.org.za.
Redefine Properties will put green building in the spotlight and help steer South Africa's green journey into a bright future at the Green Building Council of South Africa's (GBCSA) 7th Annual Convention in Cape Town this week. By sponsoring two keynote speakers for the convention, Redefine is sharing the latest thought leadership with the property industry and delegates from many other fields of business that attend the event. Mike Ruttell, Redefine's Executive Director for Development, comments: "Green building plays a key role in our own sustainability journey.Because of our focus on minimizing the energy consumption of our buildings, managing the environmental impact of our properties, and building highly attractive and productive work spaces, Redefine aims to design all our new build developments to achieve a minimum 4-Star Green Star SA rating in line with the GBCSA assessment criteria." As a keen member of the GBCSA, the company has set goals for greening its buildings. These objectives include keeping up with the latest in renewable energy developments and other suitable and economically viable green alternatives. To do this, Redefine taps in to the latest thinking from the leading minds in sustainability, and it will share some valuable insights and benefits by sponsoring Anton Musgrave and Dion Chang as speakers at the GBCSA Convention. Anton Musgrave will call on his background in property to focus attention on driving sustainable growth and long-term relevance in a changing world.Musgrave is a futurist, business strategist, entrepreneur, and will discuss the strategic thinking and future innovative growth imperatives needed to endure as the world around us evolves. Innovator, creative thinker and trend analyst Dion Chang, will also speak on sustainability as a key consideration for tracking trends.His trend analysis firm Flux Trends specializes in tracking shifting social dynamics and understanding the consumer mind-set. The focus is translating global trends, including green building, to ensure relevance for South African business. With its hands-on approach to green building, Redefine has already achieved a 4-Star Green Star SA rating from the GBCSA for the design of its 90 Grayston Drive Premium Grade office development, which has positioned itself among South Africa's most innovative and recognizable buildings. Redefine has also submitted its development of the Webber Wentzel Head Office at 90 Rivonia Road Sandton for a four star green star rating, with features such as sustainable use of concrete and steel, photovoltaic cells on the roof, ice-storage air-conditioning system, a ventilated fade that reduces air-conditioning requirements, intelligent light switching, and utility meters on each floor. Redefine also has a number of quality green buildings and green star submissions in the planning phase. New buildings aren't Redefine's only focus on its green journey. Redefine is also in the process of transforming the "The Towers" (previously known as Standard Bank Centre) in Cape Town.This building is just several blocks away from Cape Town Convention Centre where the Green Building Conference takes place. The new flushed glazed system Further, across its portfolio, Redefine has also targeted installing energy efficient lighting, occupancy sensors and timers, switching off unnecessary equipment after hours via building management systems, and installing variable speed drives for air- conditioning plant. The theme for this year's GBCSA Conference is "It's time for Africa to Bringing it home". Ruttell says, "Redefine is pleased that, as we continue on our green journey, we'll be among those at the forefront of this important shift in ensuring the built environment is in harmony with the natural environment on our continent. Our green buildings benefit both our tenants and our environment by utilizing latest technology across the designs, drawing less from power the grid, reducing our carbon footprint, and therefore optimizing operational costs for our tenants."
Redefine Properties yesterday announced the appointment of Leon Kok as the company's Financial Director, effective 01 October 2014. Commenting on the appointment, Redefine CEO Andrew Konig said: "Leon is an accomplished executive with significant financial and operational expertise and will be an exceptional addition to our team. "As Financial Director, his significant business, financial, corporate and corporate strategy experience will add a valuable perspective to Redefine's board of directors. We look forward to benefitting from his insight and experience." A Chartered Accountant with an excellent blend of operational experience, sound business acumen and technical accounting knowledge, Leon joins Redefine from a 13-year career at Peermont Global Limited, last being Chief Operating Officer for this owner and operator of hotel, casino and convention properties since 2007. Prior to this Leon completed his articles and remained with KPMG until 2000 whereafter he moved to Brait SA as Group Financial Manager and then to Emperors Palace as Chief Financial Officer until 2006. Earlier this year, Redefine announced changes to its board of directors that reflect an important pivot in the focus of management and bolstered existing management with the addition of high quality industry experience. "The appointment of Leon supports Redefine's continuing evolution and strategy to focus on the diversity of experience and skill sets required to deliver and enhance value for shareholders," added Konig.
Redefine Properties is pleased to announce that it has been selected as an index component of the Dow Jones Sustainability Indices (DJSI) in recognition of Redefine's corporate sustainability leadership in the property industry. Redefine will be included in the Dow Jones Emerging Market Sustainability Index from 22 September 2014. The index is composed of emerging market sustainability leaders as identified by RobecoSAM through a corporate sustainability assessment.The index aims to represent the top 10% of the largest 800 companies in emerging markets based on long-term economic, environmental and social criteria. Redefine is one of only five companies in the real estate sector across a dozen emerging markets included in the index.It joins 17 other South African companies in the index of 86 components from 37 industries in 12 countries, including the likes of Woolworths, Standard Bank, Nedbank, Netcare, Barloworld and AngloGold Ashanti. Andrew Konig, CEO of Redefine Properties comments: "We have come a long way in our sustainability journey and, more and more, we are putting our commitment to sustainability into action.Our inclusion in the DJSI supports this and can give investors confidence that sustainability is a business imperative for Redefine." He explains the index serves as a benchmark for investors who integrate sustainability considerations into their portfolios. "This puts Redefine in a strong position to attract funds from capital owners who want to invest in sustainable businesses." Inclusion as a component of the DJSI is evaluated with the RobecoSAM Corporate Sustainability Assessment, which strives to identify the most sustainable companies in the world. Redefine's results outperformed the Emerging Markets Index's real estate industry average overall, as well as for all three dimensions measured: economic, environmental and social. RobescoSam Sustainability Investing considers climate change and energy efficiency of great importance for the real estate industry as buildings are responsible for about one third of global greenhouse gas emissions.Moreover, low-energy buildings that use innovative materials reduce the impact of volatile energy prices on the cost of management and ownership of a property.This results in high demand for green buildings. It also notes that, in addition to environmental issues, social responsibility and social integration are gaining importance in this industry. In the current volatile economic environment, community engagement and investments in areas surrounding properties are receiving increased attention to maintain asset values high and remain the preferred property owner for tenants.
You can't get a job without experience and you can't get experience without a job. University and school leavers across South Africa face this frustrating predicament as well as a disheartening tough job market. The good news is Redefine Properties is solving this dilemma for smart young graduates, and setting their careers in motion to a brighter future. Redefine is recruiting graduates and school leavers from designated groups fresh out of university and school. It gives bright young stars, who have successfully completed studies in various disciplines such as legal, human resources, internal audit, finance and property related fields, as well as school leavers who may not have the financial means to further their education, the opportunity to gain one year of hands-on business experience with a paid learnership that will give their careers a powerful kick-start. Redefine's learnership programme will enter its third successful year in 2015 and has created an exceptional opportunity for promising graduates with their sights set on a career in the country's exciting and growing listed property sector. Starting with a humble five learners in 2013, the programme grew to 18 learners in 2014 and is expected to expand even further next year. Renske Coetzee, Redefine's Head of Human Resources, explains this learnership programme has far-reaching consequences for the graduate, Redefine, the property sector and the economy in general. Coetzee comments: "South Africa faces a shortage of skills and suitably qualified and experienced individuals.This also impacts the property sector, where we have access to only a small pool of quality employees.Our learnership programme creates an exciting opportunity for youngsters, and it also grows the number of qualified and skilled people entering our sector." "We believe our learnerships go a long way to create a better future for South Africa, the property sector and the next generation of business leaders." As one of South Africa's leading and largest JSE-listed property companies, Redefine is in a unique position to have deep and lasting positive impacts on boosting skills in the sector with its learnerships. By creating this opportunity, Redefine is also placing itself in the best position to become home to South Africa's most promising, skilled graduates. Half of the learners in this year's programme have been offered further work contracts with Redefine. Successful candidates benefit from structured learning which will earn them a recognised qualification in business administration, customised to the property sector and Redefine.They'll also get practical, on-the-job training in all facets of property management and be managed, coached and buddied by Redefine's experienced employees and managers. The sought-after learnership opportunities contribute to Redefine's positive impact on society and sustainability. At Redefine, we're people, not landlords and this sustainable human resources initiative furthers this position," says Coetzee. "We're real people who want to add value to our clients, our youth, our communities and our industry and we strive to be a preferred employer. We are committed to social responsibility and positive growth in all sectors in our society." Redefine is a component of the JSE Socially Responsible Investment (SRI) Index for its commitment to environment, society, governance, sustainability and climate change. It also debuted on the Dow Jones Emerging Market Sustainability Index in September 2014.
Redefine Properties' Matlosana Mall in Klerksdorp, North West, opened its doors for the first time today, delighting crowds of shoppers who came to enjoy the grand opening of this landmark shopping centre and be among the first to experience its exciting retail and restaurants. Measuring a sizeable 65,180m2, this super-regional mall brings world-class shopping to the Klerksdorp region and adds a tailor-made quality retail asset to Redefine's property portfolio. Leading JSE-listed REIT Redefine has invested approximately R1 billion to develop the high-quality Matlosana Mall. Its developer and leasing manager is Abacus Asset Managers. The super-regional shopping centre features a compelling selection of 145 exciting stores and tempting restaurants, which pleased shoppers on Matlosana Mall's public debut. Redefine's Development Director, Mike Ruttell, comments: "Matlosana Mall is a significant project that meets all the criteria for a top-notch super-regional shopping mall. Most importantly, it meets a real need for wide-ranging, quality retail in this community." He adds: "Matlosana Mall's excellent location, easy access, ample parking, modern design, superb retailers, and great dining and entertainment choices all add up to an appealing new shopping experience for the under-retailed consumer market of Klerksdorp and beyond." The mall features the flair of many of South Africa's best loved retailers, including anchor tenants Checkers, Pick n Pay, Woolworths, Edgars and Foschini.Shoppers were spoilt for choice on opening day with a vast variety leading national brands and independent retailers across a wide diversity of shopping categories. Shoppers were welcomed to a vibrant show of fashion, lifestyle, goodies and gadgets, as well as an exceptional line-up of groceries and a strong selection of fun, fast-foods and restaurants. Ruttell adds: "While the mall brings together the best retail in South Africa under a single roof, one of the most important considerations in selecting the tenant mix has been matching it to consumers. Matlosana Mall's shops and restaurants have been chosen with the needs and desires of its shopper profile in mind." This is only one of the ways that Redefine's Matlosana Mall has prioritised positive impacts on its community. In fact, Redefine set out to ensure that the development of Matlosana Mall resulted in valuable impacts for its surrounding community right from the start. Redefine's investment has also created employment, with the development employing some 3,000 people and 102 different subcontractors on its safe site, during the 18-month construction of the mall. It also significantly improved road infrastructure, with two access points from the N12 highway having been constructed as part of the mall's development. The highway has also been widened to three lanes adjacent to the mall. This makes it easy for shoppers from surrounding towns to enjoy a day at the mall, and offers additional benefits to local residents, making it easier for them to get where they want to go. The valuable added potential of this investment is even more significant when considering that Matlosana Mall is conveniently placed at the eastern entrance to the town, as the catalyst of the N12 development corridor. This growth node stretches between Klerksdorp and Stilfontein and is earmarked as a vital economic growth area in the region. It is driving the progress of a vibrant new node around it, with residential development, convenience, and value shopping planned adjacent to the centre. Matlosana Mall is also environmentally responsible, using green building techniques and technology. Its cutting-edge design also incorporates best practice green building principles, including energy-efficient lighting. It is also boosting the local economy by keeping consumer spend within the region, and shoppers no longer have to travel unnecessarily to get the retail brands, ranges and products they want. Ruttell concludes, "Matlosana Mall is a wide-ranging and appealing experience for all its shoppers. It is also an excellent opportunity for Redefine to grow its retail portfolio with a quality super-regional shopping mall tailored to meet all our investment criteria." Interesting facts: For its construction, Matlosana mall used nine million bricks.The mall was also built with 33 000m3 of concrete, which is equivalent to 55 000 baths of water. Matlosana Mall's roof is the size of 15 rugby fieldsThe extreme length of the building is 1km, from Checkers at the Klerksdorp end to Pick n Pay on the Stilfontein side. Its glittering shopfronts span 3km, which is equal to 1,820 people standing next to each other with arms stretched out. The mall offers approximately 2,842 parking bays, and nearly 1,000 cars can be parked undercover in the mall's 31,000m2 lower parking level.
Redefine Properties today announced a distribution of 38.14 cents per share for the second half of 2014, which combined with the first-half distribution of 36.4 cents per share results in growth of 8.5% on a full year basis, delivering performance ahead of market guidance. The results mark Redefine's first full year trading as a REIT (real estate investment trust), and its debut dividend distribution, with its new all share structure effective from 29 August 2014. This year also saw Redefine's introduction of a distribution reinvestment option for shareholders. To optimise in an evolving business environment, Redefine made changes to its senior management, and refined its strategic focus. And, for the first time, Redefine's asset base exceeded the R50 billion mark, with its property income earning asset base valued at R51 billion. Andrew Konig, CEO of Redefine, attributes Redefine's strong performance to the disciplined execution of its strategy, quality acquisition.
Redefine Properties today announced its proposal to acquire up to an additional 250 million participatory units in Fountainhead Property Trust. In doing so, Redefine, which is already the largest single Fountainhead participatory unitholder, intends to grow its Fountainhead holding. Redefine is pleased to announce that, for a third consecutive year, we have been included in the JSE Socially Responsible Investment (SRI) Index. SRI Index inclusion requirements relate to environmental, social and governance (ESG) practices and policies, as well as climate change. To compile the 2014 index, the JSE assessed all 156 members of the FTSE/JSE All Share Index, with 82 companies meeting the inclusion requirements. It also only considered publicly available information, which means transparent reporting and communication played an important role in Redefine being included. The SRI Index is an aspiration sustainability benchmark that recognises listed companies that incorporate sustainability principles in their everyday business practices. For investors, the SRI Index can help those aiming to pick companies with a longer term horizon that are managing their risks responsibly. The assessment revealed that Redefine has a low environmental impact, resulting in environmental best practice. Redefine met all the core indicators for governance and sustainability concerns, achieved the requirements for social issues and was considered at entry level for carbon disclosure. Andrew Konig, CEO of Redefine Properties, comments: "We are pleased at our ongoing inclusion in this important benchmark which, like Redefine, puts sustainability at its core. Sustainability is imbedded into our business strategic objectives and we will continue to work towards improving key performance indicators in all areas of the business. "We are also delighted by the strong shareholder support received on the distribution reinvestment plan resulting in nearly R1 billion conserved." Redefine raised R987.9 million in equity through our distribution reinvestment plan, with shareholders holding 71% of qualifying shares electing to re-invest their distribution in Redefine. As a result, Redefine will allocate 103 991 300 new shares at a reinvestment price of R9.50 per share. Konig adds, "The active shareholder participation in the reinvestment alternative is underpinned by investor confidence and a healthy appetite for further investment in Redefine."
Redefine Properties today announced the acquisition of the Leaf Capital portfolio of properties for R4.1 billion equating to an initial income yield of 8%, substantially enhancing Redefine's office portfolio in the Western Cape. Marc Wainer, Executive Chairman of Redefine Properties comments: "Acquiring this trophy portfolio is a strategic triumph for Redefine. It is underpinned by high-quality income streams from its large, excellently located, premium grade office precinct assets. "The transaction includes a number of significant properties such as Black River Park and the Wembly Square Development.These assets change the face of our Western Cape portfolio, which will now include the top five percent of quality office blocks in Cape Town." In Gauteng, the acquired assets include Bryanston properties Silver Stream Business Park, Silver Point Office Park, Crawford House and Hampton Park. It also comprises Clearwater Office Park in Stubens Valley and Centurion Gate in Centurion. Leaf Capital is an unlisted company with nine substantial property assets in Gauteng and the Western Cape. The properties are well-located in major metropoles and benefit from strong lease covenants and quality tenants, such as Amazon, Medscheme, Kumba Iron Ore, Dimension Data, and the Green Building Council of SA. The portfolio is underpinned by strong lease covenants with 37% of the portfolio expiring in more than five years. The fund has maintained a tenant retention ratio of 82% (94% excluding buildings eaermarked for refurbishment) as well as delivering growth in lease renewals of 1.51% at a weighted average escalation rate of 8.1%. In addition, the portfolio offers future additional development potential as it includes developable bulk at Black River Park, The Boulevard, Silver Stream Business Park and Centurion Gate. Redefine will pay the purchase consideration through assumed third party debt of approximately R1.9 billion, 80% of the balance will be settled through a placement of shares and 20% funded from existing cash resources. While subject to Competition Commission approval and other conditions, the deal is expected to take commercial effect from 1 March 2015.Wainer notes: "This strategic transaction advances our strategy to grow a quality, diversified portfolio of properties that support sustainable and growing performance for our investors."
Hot on the heels of the Leaf portfolio acquisition, Redefine today announced it has acquired a portfolio of 56 retail properties in Germany in an equal joint venture with Redefine International. This portfolio is valued approximately ?157m million and reflects an initial net yield of 7.5%. The portfolio will initially be acquired with the existing bank debt of ?100m which the joint venture intends to refinance immediately after the transaction closes. After the financing the portfolio will produce a yield on equity in excess of 11%. Marc Wainer, Redefine Executive Chairman, comments: "This transaction is consistent with Redefine's stated intention of acquiring offshore properties directly and in partnership with established players. It is our first direct investment in Europe, and by partnering with Redefine International, we also benefit from its experienced European asset management team. "We sourced the portfolio and invited Redefine International to participate. All of the management and asset management will be undertaken by Redefine International for a fee of 0,375% of Redefine's share of the portfolio's gross asset value." The properties span some 128,000sqm of lettable area and comprise a mix of stand-alone supermarkets, food-store-anchored retail parks and cash-and-carry stores. The properties are well located within their respective markets, 85% in Western Germany and Berlin, with the remainder in East Germany. The portfolio is 99.2% occupied and benefits from strong tenant covenants with 90% of its gross rental income accounted for by Edeka, Netto, Rossmann and Real who are amongst Germany's largest retailers, exposing Redefine to high quality, secure, indexed-linked cash flows. The net equity consideration of approximately ?58m will be funded equally by Redefine and Redefine International from existing cash resources. The joint venture will initially assume the existing bank debt facilities of ?100m which have a weighted interest cost of 4.4% per annum, but the joint venture will refinance the existing facilities at current market rates on closing. The refinancing will be approximately 50% loan to value with an all-in cost of debt of 1.8%. "We are extremely excited about this acquisition. Our investment in Northpoint Australia is performing exceptionally well and we have no doubt that this acquisition will be equally successful," concluded Wainer. Redefine is one of SA's largest REITs with and property income earning asset base valued over R50 billion. In addition to its first direct European acquisition, Redefine has a 30.1% direct interest in Redefine International PLC and a R3.9 billion presence in the Australian property market, with 50% interest in North Sydney's landmark tower, Northpoint, and a 15.9% holding in ASX-listed Cromwell Property Group, as well as a 10% indirect equity interest through Redefine International.
Redefine Properties today reported distribution growth of 7.1% to 39 cents per share for the half-year to 28 February 2015, delivering on its market guidance. Andrew Konig, CEO of Redefine comments: "Redefine's solid performance and growth in distributable income for the half year of 31. 4% reflects our enhancing acquisitions and successful strategies. "Our diversified asset base and stated strategies will enable us to achieve our long-term goals. We are confident that we will deliver distribution growth of between 7% and 7.5% for the full 2015 year." Redefine's strategic growth, geographic diversification, tight asset management, efficient cost control and effective tenant retention strategies all contributed positively to the results despite ongoing challenging property fundamentals, with the operating environments across all property sectors remaining subject to uncertainty around electricity supply and local service delivery. JSE - listed Redefine is an internally managed diversified REIT that controls a property i ncome - earning asset base of R55. 6 billion, which increased by some R5 billion du ring the half year. Its market capitalisation appreciated a considerable 2 3 .6 % during th e six - month period to R4 5 billion, of which 22. 9% now represents international ownership, with notable investor inflows from Europe. Konig notes the increase in international investment in Redefine has come when domestic interest rates look like they could increase again. "This helps us fund future investments at a lower average cost." Redefine's property portfolio income for the period was 95 . 2% of its total revenue, while inco me from listed securities was 4. 3%, and tr ading and fee income totalled 0. 5%. Its local investment assets comprise an actively managed diversified, directly - held p roperty portfolio valued at R35. 9 billion. Fountainhe ad Property Trust, in which Redefine has a 65 . 9% equity interest, has a R11. 9 billion property portfolio, comprising predominantly of retail assets. Redefine now holds 11. 5% of Emira . Redefine has a 30. 1% equity interest of R3. 6 billio n in Redefine International PLC (RI PLC) , which is listed on both the LSE and the JSE. In add ition, Redefine has a direct 50% interest in Australia's North Sydney landmark tower, Northpoint, as well as holding 15 . 9% of ASX - listed Cromwell Property Group totalling R4.1 billion . Redefine has a further 10% indirect equity interest in Cromwell through RI PLC. "Our domestic priorities include dealing with the electricity crisis by providing uninterrupted power supply at our key properties, as well as energy - efficiency initiatives and sustainable building technologies," reports Konig . "We're also focused on upholding our profit margins, given rising utilities and rates and taxes. Letting of vacant space and managing tenant credit risk is another key focus area, given the muted state of the economy. We will also help further sustainable, long - term economic and social development, by establishing the Redefine Empowerment Trust. " Redefine aims to continue diversifying, growing and improving the quality of its portfolio. It made excellent progress during the half - year with a programme of strategic acquisitions including 31 direct properties acquired for a total R3 billion at an initial yield of 8. 5%, and the Leaf portfolio for a collective R4 . 7 billion at an initial yield of 7 . 8%. Redefine is making progress in the acquisition of all the Fountainhead assets - a process which it aims complete and implement before the financial year end. Konig says Redefine will continue to seek out prospects for its international investment, " although it is difficult to source opportunities given the weight of money chasing prop erty internationally right now." He adds Redefine is also exploring new subsectors to support investor value. This includes de - risked projects in student and possibly residential accommodation, geared to test market demand and strategic suitability. " The headwind of upward interest rate pressure will pose a challenge for the listed property sector, but we believe it will also create opportunities in the rest of the year. We will continue to identify and pursue enhancing opportunities which furthers Redefine's strategy to become South Africa's best REIT and deliver sustained value to our shareholders." says Konig
Redefine Properties have set a new benchmark for commercial property development with a series of building innovations that is transforming the architectural face of Johannesburg. This was highlighted at the recent SAPOA Innovative Excellence in Property Development Awards which saw a flagship commercial building project for Redefine, 90 Grayston, winning the esteemed award for Commercial Office Development. "The property world is changing rapidly and we are proud to be at the forefront of this new era," says Mike Ruttell, Executive Director: Development at Redefine Properties. "It's all about forward thinking architecture backed with extremely powerful green building technology. We knew we were making a statement with 90 Grayston, and winning this award shows us that we are being heard." The Innovative Excellence Award, known as "the Oscars of the property industry" recognise the country's top buildings in terms of innovation, aesthetic appeal, sustainability, creativity, as well as game-changing architectural concepts, as judged by a panel of the industry's top consultants. "The power of this building is really in its architecture, together with the highly attractive and efficient space it offers to tenants. There is really nothing else like it in Johannesburg, which makes it the perfect flagship for our new development drive," says Ruttell. 90 Grayston is a 16-storey premium-grade office building of 19,343m2 in Sandown, central Sandton. It includes 11 levels of parking - five basement and six above ground, achieving a parking ratio of nearly five bays per 100m2. There are nine levels of offices above an elevated atrium, and the building will also have its own cafeteria. 90 Grayston is 4-Star Green Star SA Office rated building, certified by the Green Building Council South Africa. This intelligent building respects the environment with a combination of passive design principles and world-class green technologies to minimise the impact of the building and its ongoing use on the environment. These include the use of a High-efficiency ammonia chiller HVAC system and the harvesting of rainwater to flush toilets.
Shareholders of Redefine Properties, one of the country's largest listed property companies, have approved the establishment of an Empowerment Trust - a move that will materially bolster its BBBEE credentials. Shares to be issued to the Trust will hold an equity value of approximately R3 billion. At a general shareholders meeting held in Johannesburg today, Redefine shareholders voted in favour of issuing up to 300 million shares to the newly established Trust, funded by a loan advanced by the company. "We are delighted with the outcome of today's vote. The overwhelming support of our shareholders to create this Trust reaffirms our group's commitment to sustainable empowerment," says Andrew Konig, Redefine CEO. "This is an important milestone for the company and a significant step towards achieving our BBBEE objectives." "Our approach to transformation is to create sustainable, robust, credible and broad-based benefit and value, and we believe that this transaction will generate long term value for all stakeholders." The Trust, which is structured as a capital preserving Trust will continue in perpetuity and its principle focus is on activities to improve education and training at all levels; through the provision of scholarships and bursaries and community development programmes. Beneficiaries include pre-school children, school children, students at tertiary institutions, black entrepreneurs, community upliftment programmes and poverty alleviation organisations. "We have been very clear about the tangible social impacts we want to make with this Trust. We believe that by empowering South Africans at all levels through education, we can go a long way towards overcoming the barriers to transformation and at the same time, create the kind of skills that the country really needs. Beneficiaries have therefore been carefully categorised according to four classes to ensure the appropriate allocation of funds," said Konig. The Trust will operate independently and will be managed by external independent Trustees. All beneficiaries must be black South Africans, of whom at least 50% should be female, according to the scheme's terms. The transaction was developed and structured in accordance with the DTI's Code of Good Practice and the Property Sector Charter Codes.
Redefine Properties, SA's second-largest real estate investment trust, has secured its takeover of Fountainhead Property Trust's property portfolio. The deal received overwhelming approval by Fountainhead unitholders eligible to vote (Redefine as a related party to the transaction was precluded from voting its shares) at a general meeting held in Rosebank this morning.Redefine, which owns Fountainhead's management company and holds a 66% equity interest in Fountainhead, will acquire all of Fountainhead's assets including the entire Fountainhead property portfolio in exchange for 85 new Redefine shares for every 100 Fountainhead units plus the assumption of Fountainhead's liabilities. Based on Redefine's current share price, the transaction places a value of just under R14 billion, on Fountainhead's property portfolio, comprising 44 properties, of which 70% by value are prime retail assets."We are thrilled with the outcome of today's meeting which for us completes a process we began more than three years ago," said Redefine CEO Andrew Konig. "The acquisition of this portfolio positions us to manage our balance sheet and domestic asset allocation more efficiently to provide our shareholders with the added benefit of increased direct exposure to retail real estate assets." For Fountainhead investors, the transaction will provide exposure to a diverse portfolio of local and international property assets valued at approximately R60 billion, access to a broader funding base and the benefits of economies of scale and cost savings thanks to synergies between both property portfolios.For Redefine shareholders, the transaction means portfolio growth, quality improvement, structural simplification and diversification through the added benefit of increased exposure to retail property."We are greatly encouraged by the shareholder support we received from Redefine and Fountainheads' shareholders and are excited to be implementing this acquisition, which to a large extent, completes Redefine's property portfolio restructure which began towards the end of 2011" concludes Konig.
For the second time this year, Redefine has been recognised for the quality of its integrated reporting when the company received the Nkonki Top 100 JSE Integrated Reporting Awards for its 2014 Integrated Annual Report. Redefine was ranked joint sixth overall out of the Top 100 JSE listed entities at a function held last week and also received an Excellence Award for achieving an A-rating (above 80%) for its Integrated Annual Report. The Nkonki awards recognise those JSE listed companies who are committed to adopting the internationally recognised Integrated Reporting Framework devised by the International Integrated Reporting Council. In August 2015, Redefine was also ranked sixth in the top ten positions in the EY's Excellence in Integrated Reporting Awards 2015, improving on its 2014 merit award for the most improved integrated annual report. Commenting on the award, Redefine Financial Director Leon Kok says, "This award is yet another achievement in a watershed year for us, which includes being listed in the JSE Top 40 for the first time. To receive two awards for excellence in integrated reporting is testimony to our commitment to transparent stakeholder communication in all of our reporting. "Our integrated annual report represents an opportunity for us to share our story of value creation and business strategy as well as our plans to align environmental and social challenges and opportunities with our stakeholders. We are therefore extremely pleased to receive recognition that our integrated reporting journey is on the right track and encourages us to strive for further improvement."
Redefine Properties' full-year results released today reflect the company's strong growth trajectory for the year ended 31 August 2015, backed by a solid financial performance and underpinned by a dynamic, future-focused strategy. The company declared a final distribution of 41 cents per share, taking its full year distribution to 80 cents for the year ended 31 August 2015, translating into a 7.3% increase on the previous year. Commenting on the results, CEO Andrew Konig says, "This has been a year of high activity in which we significantly expanded on the scope and quality of our investments. Our objective has been to create a robust platform from which we can achieve and sustain long term growth. Our investment profile has also been raised considerably by our inclusion in the JSE Top 40 index, in this, our 15th year as a listed company." In another first for the company, its distributable income has risen by R875 million to exceed R3 billion, an increase of 36%. Group total assets also increased by 22% to R70 billion, predominantly funded through expansion of the capital base, which resulted in improved credit metrics. The portfolio of global property assets currently managed by Redefine - and spread across South Africa, Europe and Australia - is valued at R64.5 billion. Redefine's international operations, which provide geographic diversification, accounted for 17% of distributable income, and are anticipated to grow between 20% and 25% over time. The company's domestic property portfolio has also improved in quality and scale through a process of acquisitions and development activity. Of the several property transactions concluded during the year under review, one of the most sizeable acquisitions has been the deal with Leaf Property Fund to acquire its 14 high-quality commercial property assets valued at R4.1 billion. Redefine's directly held property portfolio also received a boost from the merger with Fountainhead Property Trust, which was settled by Redefine issuing R3.8 billion in shares to the Fountainhead minorities. In the process, Redefine has gained direct control of a predominantly retail portfolio of 44 properties. "The Fountainhead merger translates into more efficient management of the portfolio and largely completes the restructuring that began in 2011. The Leaf acquisition on the other hand increased our representation in the office market, particularly our footprint in the Western Cape where we now have several Green Star-rated properties," says Konig. The Leaf deal boosts Redefine's human capital, and brings valuable skills in retrofitting buildings to improve energy efficiency, an important sustainability focus for the company. Over and above the Leaf and Fountainhead portfolios, the company also acquired and transferred ownership of 34 properties, for the aggregate sum of R3.9 billion. Redefine's international expansion involved a further investment of R1.6 billion in Cromwell, taking a direct 50% holding in a German property portfolio with an equity contribution of R700 million and maintained its 30% holding in Redefine International by participating in various equity activities totaling R500 million. New developments in South Africa with an approved value of R3 billion are currently in progress, while refurbishment of existing properties in the portfolio, valued at R800 million, are also underway. Projects worth R1.4 billion were completed during the course of the past financial year. A strong focus for the company is environmental sustainability. Redefine is in the process of installing smart metering for water and electricity across their portfolio, the positive impact of which will be improved billing and consumption management. Explaining Redefine's sustainability focus Konig says, "Income yields can be increased by more than 10% with the use of solar. We are looking at alternative sources of energy and especially so as there has been an improvement in the efficiency and cost of photo-voltaic panels. However, not all existing roof structures have been designed to carry the weight of these panels, so we also need to consider feasibility." Redefine is aiming for at least a four-star Green Star rating across all its new developments, which includes their 90 Rivonia Road and 90 Grayston Road properties. "Property is embedded in the economy and in the community, and sustainability forms a core component of our long-term strategy to provide world-class, efficient and sustainable spaces. Our asset management strategy is geared to protecting and entrenching our assets." says Konig. The company is expecting to deliver six to seven percent distribution growth on a per share basis for the forthcoming year.
Johannesburg, South Africa – 05 September 2016: Redefine Properties Limited (“Redefine” or the “Issuer”) announces the launch of an offering of senior, secured exchangeable bonds due 2021 (the “Bonds”) with a principal amount of EUR150 million, exchangeable into ordinary shares (the “Shares”) of Redefine International P.L.C. (the “Company”). The Bonds will be marketed with a coupon range of 1.25 – 1.75%, payable semi-annually in arrear. The initial exchange price of the Bonds is expected to be set within a premium range of 22.5 – 30.0% to a reference price (the “Reference Price”) determined as the euro-equivalent of the arithmetic average of the daily volume weighted average prices of a Share listed on the London Stock Exchange plc (the “LSE”) on each of the five scheduled trading days commencing on (and including) the date hereof, such Reference Price being subject to a floor of EUR 0.45673 and a cap of EUR 0.51902. The Bonds will be issued at 100% of their principal amount and, unless previously exchanged, redeemed, or repurchased and cancelled, will be redeemed at par (subject to the Issuer’s settlement option referred to below) on 16 September 2021. Holders of the Bonds will have the option to require an early redemption of their Bonds on the third anniversary of the issue date, at their principal amount, together with accrued interest. Upon exchange the Issuer will have the flexibility to settle in cash, deliver the underlying Shares or any combination thereof. The Issuer will have the option to redeem any outstanding Bonds at their principal amount together with accrued interest under certain customary conditions, as further described in the terms and conditions of the Bonds (the “Terms and Conditions”). The Issuer will also, at maturity or upon early redemption, have the option to deliver a combination of Exchange Property, in whole or in part, and cash, subject to customary conditions described in the Terms and Conditions.The Issuer's obligations in respect of the Bonds will be secured under English law by, inter alia, a first fixed charge over the pledged property (which shall initially include such number of underlying Shares as is determined at final pricing (the “Exchange Property”)) and the Stock Lending Agreements entered into by the Chargors (each as defined below), pursuant to the security agreements between Redefine Retail (Pty) Ltd, Madison Property Fund Managers Holdings Limited, Madison Property Fund Managers Limited and Redefine Global (Pty) Ltd (the “Chargors”) and the Trustee. Any adjustment to the Exchange Property, including in respect of cash dividends, shall trigger a corresponding adjustment to the pledged property. The Bonds are expected to be rated by Moody’s. The Bonds will be rated after the Settlement Date.In the context of the transaction, the Issuer and its subsidiaries will be subject to a lock-up undertaking in relation to the Shares for a period ending 90 days after the Settlement Date (as defined below), subject to customary exceptions. Certain final terms of the Bonds are expected to be determined and announced today and settlement is expected on or around 16 September 2016 (the “Settlement Date”). Application will be made to admit the Bonds to trading on the Open Market (Freiverkehr) of the Frankfurt Stock Exchange by no later than 90 days following the Settlement Date. The Issuer will use the proceeds of the issuance of the Bonds to refinance debt, provided by the Sole Bookrunner and associated entities, incurred in the acquisition of a majority interest in Echo Prime Properties B.V. J.P. Morgan Securities plc is acting as Sole Bookrunner on this transaction. J.P. Morgan Securities plc, the Issuer and the Chargors will enter into stock lending agreements (the “Stock Lending Agreements”) on or around the date hereof in respect of Shares representing approximately 10 per cent. of the Company’s issued share capital for the purposes of facilitating investors’ hedging activities. For more information, please contact:Redefine Properties Limited:Redefine Place3rd Floor2 Arnold RoadRosebankGautengSouth Africa2196 Telephone: +27 11 283 0032Attention: Leon Kok 5th September 2016 Company sponsor: Java Capital NO ACTION HAS BEEN TAKEN BY THE ISSUER, THE COMPANY, THE SOLE BOOKRUNNER OR ANY OF THEIR RESPECTIVE AFFILIATES THAT WOULD PERMIT AN OFFERING OF THE BONDS OR POSSESSION OR DISTRIBUTION OF THIS PRESS RELEASE OR ANY OFFERING OR PUBLICITY MATERIAL RELATING TO THE BONDS IN ANY JURISDICTION WHERE ACTION FOR THAT PURPOSE IS REQUIRED. PERSONS INTO WHOSE POSSESSION THIS PRESS RELEASE COMES ARE REQUIRED BY THE ISSUER, THE COMPANY AND THE SOLE BOOKRUNNER TO INFORM THEMSELVES ABOUT, AND TO OBSERVE, ANY SUCH RESTRICTIONS. THIS PRESS RELEASE IS NOT FOR DISTRIBUTION, DIRECTLY OR INDIRECTLY IN OR INTO THE UNITED STATES OR TO U.S. PERSONS (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT). THIS PRESS RELEASE IS NOT AN OFFER TO SELL SECURITIES OR THE SOLICITATION OF ANY OFFER TO BUY SECURITIES, NOR SHALL THERE BE ANY OFFER OF SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SALE WOULD BE UNLAWFUL. THE BONDS MAY BE DEEMED TO BE THE SECURITIES OF A “COVERED FUND” FOR THE PURPOSES OF THE VOLCKER RULE.THE ISSUER IS NOT REGISTERED UNDER THE UNITED STATES INVESTMENT COMPANY ACT OF 1940 AND INVESTORS WILL NOT HAVE THE BENEFIT OF THAT ACT. THIS PRESS RELEASE AND THE OFFERING WHEN MADE ARE ONLY ADDRESSED TO, ANDDIRECTED IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA (THE “EEA”) AT PERSONS WHO ARE “QUALIFIED INVESTORS” WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE PROSPECTUS DIRECTIVE (“QUALIFIED INVESTORS”). FOR THESE PURPOSES, THE EXPRESSION "PROSPECTUS DIRECTIVE" MEANS DIRECTIVE 2003/71/EC, AS AMENDED. IN ADDITION, IN THE UNITED KINGDOM THIS PRESS RELEASE IS BEING DISTRIBUTED ONLY TO, AND IS DIRECTED ONLY AT, QUALIFIED INVESTORS (I) WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) OF; THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE“ORDER”) AND QUALIFIED INVESTORS FALLING WITHIN ARTICLE 49(2)(A) TO (D) OF THE ORDER, AND (II) TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS “RELEVANT PERSONS”). THIS PRESS RELEASE MUST NOT BE ACTED ON OR RELIED ON (I) IN THE UNITED KINGDOM, BY PERSONS WHO ARE NOT RELEVANT PERSONS, AND (II) IN ANY MEMBER STATE OF THE EEA OTHER THAN THE UNITED KINGDOM, BY PERSONS WHO ARE NOT QUALIFIED INVESTORS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS PRESS RELEASE RELATES IS AVAILABLE ONLY TO (A) RELEVANT PERSONS IN THE UNITED KINGDOM AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS IN THE UNITED KINGDOM AND (B) QUALIFIED INVESTORS IN MEMBER STATES OF THE EEA (OTHER THAN THE UNITED KINGDOM). THIS DOCUMENT IS NOT AN OFFER TO SELL SECURITIES OR THE SOLICITATION OF ANY OFFER TO SUBSCRIBE FOR OR BUY SECURITIES, AND NO SECURITIES WILL BE SOLD, WITHIN SOUTH AFRICA OR TO OR BY ANY PERSON RESIDENT IN OR WITHIN SOUTH AFRICA. ANY DECISION TO PURCHASE ANY OF THE BONDS SHOULD ONLY BE MADE ON THE BASIS OF AN INDEPENDENT REVIEW BY A PROSPECTIVE INVESTOR OF THE ISSUER’S AND THECOMPANY’S PUBLICLY AVAILABLE INFORMATION. NEITHER THE SOLE BOOKRUNNER NOR ANY OF ITS AFFILIATES ACCEPT ANY LIABILITY ARISING FROM THE USE OF, OR MAKE ANYREPRESENTATION AS TO THE ACCURACY OR COMPLETENESS OF, THIS PRESS RELEASE OR THE ISSUER’S AND THE COMPANY’S PUBLICLY AVAILABLE INFORMATION. THE INFORMATION CONTAINED IN THIS PRESS RELEASE IS SUBJECT TO CHANGE IN ITS ENTIRETY WITHOUT NOTICE UP TO THE SETTLEMENT DATE. EACH PROSPECTIVE INVESTOR SHOULD PROCEED ON THE ASSUMPTION THAT IT MUST BEAR THE ECONOMIC RISK OF AN INVESTMENT IN THE BONDS OR THE SHARES TO BE ISSUED OR TRANSFERRED AND DELIVERED UPON EXCHANGE OF THE BONDS AND NOTIONALLY UNDERLYING THE BONDS (TOGETHER WITH THE BONDS, THE “SECURITIES”). NONE OF THE ISSUER, THE COMPANY OR THE SOLE BOOKRUNNER MAKE ANY REPRESENTATION AS TO (I) THE SUITABILITY OF THE SECURITIES FOR ANY PARTICULAR INVESTOR, (II) THE APPROPRIATE ACCOUNTING TREATMENT AND POTENTIAL TAX CONSEQUENCES OF INVESTING IN THE SECURITIES OR (III) THE FUTURE PERFORMANCE OF THE SECURITIES EITHER IN ABSOLUTE TERMS OR RELATIVE TO COMPETING INVESTMENTS. THE SOLE BOOKRUNNER IS ACTING ON BEHALF OF THE ISSUER AND NO ONE ELSE INCONNECTION WITH THE BONDS AND WILL NOT BE RESPONSIBLE TO ANY OTHER PERSON FOR PROVIDING THE PROTECTIONS AFFORDED TO CLIENTS OF THE SOLE BOOKRUNNER OR FOR PROVIDING ADVICE IN RELATION TO THE SECURITIES. EACH OF THE ISSUER, THE COMPANY, THE SOLE BOOKRUNNER AND THEIR RESPECTIVEAFFILIATES EXPRESSLY DISCLAIM ANY OBLIGATION OR UNDERTAKING TO UPDATE, REVIEW OR REVISE ANY STATEMENT CONTAINED IN THIS PRESS RELEASE WHETHER AS A RESULT OF NEW INFORMATION, FUTURE DEVELOPMENTS OR OTHERWISE.
Johannesburg, South Africa — JSE-listed diversified real estate investment trust Redefine Properties (JSE: RDF) has announced its intention to acquire the entire issued share capital of The Pivotal Fund (JSE: PIV). Pivotal, a development focused investment fund, has an A-grade portfolio of completed income producing properties and developments. Under the terms of the transaction, valued at R6 billion, shareholders in Pivotal will receive from Redefine 460 million new Redefine Properties shares plus 31 million shares in Echo Polska Properties (EPP), effectively placing Pivotal shareholders in the commercial position they would have been in had Pivotal unbundled its EPP shares to its shareholders. The Redefine shares will be issued ex-dividend, anticipated to be at the end of November 2016 and the EPP share will be delivered during January 2017. Redefine Properties’ strategic investment in EPP will remain intact. The deal, which is subject to the usual regulatory processes for a transaction of this nature, will be implemented through a scheme of arrangement which requires 75% approval at a general meeting of Pivotal shareholders. Redefine Properties will delist Pivotal once the deal has been concluded which is expected before the end of the year. Andrew Konig, CEO, Redefine Properties says, “An irrevocable buy-in from a significant number of Pivotal shareholders has been received. Our intention is not to be a shareholder as we can only achieve the full potential for synergies with complete ownership.” “Development funds like Pivotal are seeing twin challenges of increasing cost of capital as well as the macro environment putting pressure on development returns,” adds Konig. The acquisition of the Pivotal portfolio enables Redefine to continue with its investment philosophy to recycle its capital through disposing assets no longer aligned to its long term investment strategy and replacing them with prime (Pivotal) assets. ‘’We believe we bring compelling value to shareholders of both companies with Pivotal shareholders receiving a long-term upside potential of an investment in Redefine, increasingly recognised for its performance in a difficult and competitive market.” The deal will see Redefine Properties which already co-owns S&J Industrial Estate in Germiston and Rosebank Galleria with Pivotal, gain significant reach in Sandton and consolidate its position in Rosebank. “The acquisition demonstrates Redefine’s strategic intent to become the landlord of choice in A-grade office space in sought after areas in South Africa. Redefine has shifted its strategy in recent years to become a more urban focused landlord by acquiring modern properties in better performing nodes,” says Konig. Pivotal’s property portfolio is valued at R12.9 billion and its income producing assets comprise 8 retail properties, 10 offices and 3 industrial sites, a number of development properties with 4 active developments. Pivotal’s African assets in markets like Mauritius, Mozambique, Nigeria, Morocco, Kenya and Zambia will be sold post implementation. Once the deal has been finalised, Redefine will operate approximately 350 properties totalling nearly 5.7 million square metres across the country. According to Konig, the deal provides Redefine with “a unique opportunity” in the current environment to acquire a portfolio of well leased modern properties in a single transaction. The acquisition further cements our position as one of the top landlords in Sandton, a node where we have grown to almost 30% of our office portfolio from almost no exposure five years or so back and allows us to make meaningful expansion into Bryanston and Centurion. In Sandton, Redefine will add crown jewels like Alice Lane with tenants like Sanlam, Santam, Standard Bank, and Virgin Active South Africa. Part of the development at Alice Lane also includes an office building likely for completion during April 2017 to house legal heavy weight Bowman Gilfillan. Besides this acquisition, Redefine Properties significantly broadened its offshore footprint earlier in the year via a €260 million equity investment into EPP which has a €1.2 billion high-yielding commercial platform comprising 18 properties in the rapidly-expanding and exciting Polish market. To continue on its growth trajectory, EPP plans to broaden its shareholder base by listing on the JSE during the first half of September this year.