Echo Polska Properties successfully lists on JSE
Echo Polska Properties N.V. (EPP) on Tuesday listed on the JSE's main board, bringing to the market a R19.5 billion (EUR 1.2 billion) property portfolio consisting commercial office and retail assets across Poland.
EPP’s listing will provide South Africans to gain direct exposure to Poland, the largest economy in Central Europe. Poland was the only country in Europe to avoid recession during the 2008 global financial crisis.
The Warsaw-based real estate investment fund, debuted under the abbreviated name “PolskProp” and JSE share code of EPP.
EPP is a publicly traded real estate investment fund with a current portfolio that includes six office and ten retail projects with gross lettable area (GLA) exceeding 424,216 sqm.
The company’s shares began the morning session on the JSE trading at ZAR R24. The company had placed approximately 71.5 million of its shares with invited investors at an issue price of EUR 1.45 per private placement share and the placement has allowed EPP to successfully raise an aggregate amount of EUR 100,000,000.
EPP CEO Hadley Dean said the success of the private placement demonstrates investors’ confidence in our growth strategy.
“We are very happy by the strong interest shown in EPP and serves as an endorsement of the unique investment opportunity we believe Poland represents. Proceeds from the capital raise will be utilised to accelerate and fund acquisitions,” says Dean.
EPP’s issued shares are currently traded on the Luxembourg Stock Exchange and its listing on the JSE constitutes a dual primary listing and will be a foreign inward listing.
Already the largest listed Polish yielding property company, EPP’s goal is to become the dominant retail landlord in Poland while targeting sustainable double digit annual growth in dividends per share in the short and medium term through a combination of organic and acquisitive growth.
The company is banking on growth opportunities that are already built into the EPP portfolio including, filling of vacancies in newly developed properties; 22,000 sqm of retail extensions to two of the company’s existing retail centres that are currently underway; a 25% stake in ten assets subject to a right of first offer (“ROFO”) and a 70% stake in an 110 000 sqm retail development in Warsaw.
EPP will remain focused on acquiring further high quality, well located office assets with strong international and domestic tenants in major Polish cities.
The company anticipates further growth in the warehouse sector, in part given the increasingly close relationship between retail and logistics arising from e-commerce.
“We will also look to trade assets where appropriate to ensure our portfolio remains balanced and competitive in the long term, while maintaining a weighted average unexpired lease term in excess of four years,” concludes Dean.
Many South African property investors have been seeking direct exposure to offshore real estate markets.
EPP is a jointly owned by Poland’s largest developer Echo Investment S.A. and South Africa’s Redefine Properties (JSE: RDF), which holds a strategic 49.9% investment.