INVESTMENTS: Property Fund Announces R1.5 Billion Deal in Lead-up to JSE Listing
Recent Gauteng Business News
Pivotal Property Fund announced a R1.5 billion acquisition from Standard Bank Properties, which includes the majority stake in Sandton’s landmark Alice Lane development, in the lead-up to Pivotal’s planned listing on the Johannesburg Stock Exchange.
“Pivotal has acquired strategic land and property assets from Standard Bank, which will be valued at more than R3.5 billion when fully developed. This major deal moves us closer to our goal of listing on the JSE’s main board with a portfolio in excess of R9 billion,” says Pivotal Property Fund managing director, Jackie van Niekerk.
“The acquisition expands our portfolio by more than 25,000mÂ² of bulk and over 72,000mÂ² of commercial space.”
A property development fund, Pivotal is a public unlisted company. It was established in 2005 by property developer Abland and its partners for property developments and strategic pipeline acquisitions.
Pivotal already owns 30% of the multiple award-winning Alice Lane office development in Sandton’s central business district. The acquisition of the remaining 70% stake as part of the Standard Bank deal will see Pivotal becoming the sole owner of this Premium-Grade office complex in South Africa’s top financial and corporate node.
Phase 1 of Alice Lane was completed in September 2013 with a GRA of almost 19,000mÂ² and blue-chip tenants including Marsh, Virgin Active, Bloomberg and Standard Bank. Phase 2 is scheduled for completion in November this year, bringing 16,000mÂ² on-stream for financial services group Sanlam and insurance company Santam. Phase 3 will follow in November 2016, with a total floor-space of 35,000mÂ² of which 22,000mÂ² will be occupied by Bowman Gilfillan, one of SA’s ‘big five’ legal firms.
In addition to being certified a four-star green building by the Green Building Council, the Alice Lane development recently won the coveted SAPOA Innovative Excellence Award for commercial development. The Virgin Active Alice Lane Health Club component of the development also won a special award for leisure and retail interior design at the South African Council of Shopping Centre’s annual Retail Development and Design Awards last month.
Other high-profile properties acquired in the Standard Bank transaction include: the 32,305mÂ² Platinum Square shopping centre in Rustenburg; Lakeview Office Park in Roodepoort; Monte Circle Office Park development land in Fourways; and, the West End Office Park development in Centurion.
As Van Niekerk points out, Pivotal’s investment criteria includes well located, A-grade commercial and retail properties assessed on a case-by-case basis.
“The fund’s performance has delivered a consistent high growth rate to date, with a 45 percent increase in net asset value per share growth (NAV) achieved in the 2014 fiscal year, with compounded annual net asset value growth of 24 percent since 2009,” she explains.
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