Gemgrow Properties dividend up

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COO Alon Kirkel said the year had been a strong one for the company, which was able to buy numerous assets from larger listed funds. COO Alon Kirkel said the year had been a strong one for the company, which was able to buy numerous assets from larger listed funds.

Gemgrow Properties, which focuses on high-yield, high-growth properties, delivered 7% growth in its B-share dividend for the year to September, in line with guidance.

Against a backdrop of increasingly difficult operating conditions, Gemgrow increased A-share dividends 5% to 106.91c per share while B-share dividends grew by 7% to 78.70c per share.

Gemgrow said it had executed its strategy to enhance its property portfolio. As many as 12 accretive acquisitions to the value of R549m were concluded which, after accounting for the disposal of six non-core assets, capital additions and fair value adjustments, resulted in an increase in the gross lettable area (GLA) of the portfolio to 751,981m² compared with 690,263m². The portfolio was worth R4.8bn.

COO Alon Kirkel said the year had been a strong one for the company, which was able to buy numerous assets from larger listed funds.

 “The past year saw us focus on reshaping and improving the defensive quality of our core portfolio through active letting strategies, refurbishments, disposals and yield-enhancing acquisitions of 12 properties," he said.

“Our portfolio now comprises 135 properties, reflecting a good mix of retail, office and industrial space mostly across key provinces. The more balanced income profile, from a geographic and property segment perspective, will enable us to navigate an increasingly tough operational environment requiring a very active approach to asset management," he said.

Following the reporting period, Gemgrow finalised further acquisitions worth R728.5m. The acquisitions were funded through debt amounting to R578.5m and the issue of A shares worth R150m. Gemgrow was also very active in restructuring its loan book, refinancing existing loans totalling R575m for five-year terms.

“We are pleased with the refinancing arrangements finalised during the year. Our solid balance sheet, with debt fully hedged and a loan-to-value ratio at a comfortable 26.8%, provides room for future opportunities in a tough, cash-strapped environment. In addition, we have also focused on cost containment measures across the portfolio and successfully disposed of non-core assets with non-sustainable income streams”, Gemgrow CFO Junaid Limalia said.

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Listed Property / REITs  |  Gemgrow Properties  |  Junaid Limalia  |  Alon Kirkel