Equites boosts interim dividend on strong property demand

18 Oct 2016

The JSE's only listed specialist logistics property developer and landlord, Equites Property Fund, grew its dividend payout 20% in the six months to August as it signed strong leasing agreements with tenants.

Equites boosts interim dividend on strong property demand

The group's half-year distribution grew to 54.44c per share.

CEO Andrea Taverna-Turisan said: "The continued strong financial results are a reflection of persistent demand for modern, well located, logistics facilities and the company's focus on institutional tenants and sound property fundamentals."

"Many of our multinational tenants have been concerned about political events in SA, general volatility in the economy and funding markets. We have still managed to serve our tenants and to motivate that Equites is a long-term investor in SA," Taverna-Turisan said.

Equites has achieved rapid growth in its property portfolio, from R1bn at listing in June 2014, to R5.9bn at the end of the reporting period. During the period, it created a strategic partnership with listed group Attacq to jointly pursue industrial developments. This led to the acquisition of eight completed industrial properties for R733m at Waterfall City, Midrand, at an acquisition yield of 8% and an average lease expiry profile of 8.4 years.

It also acquired a Tesco Distribution Centre in Hinckley, England, for £28m at an acquisition yield of about 7.2%, based on the first year's rental income of £2.016m.

Equites acquired a 20,410m² distribution centre in Trentham Lakes, Stoke-on-Trent, in the UK, which is let to Amazon on a 10-year lease that began in July. The acquisition yield was about 6.14%, based on the first year's rental income of Â£1.044m. The property is in the Midlands, which benefits from continued strong demand from logistics users in the UK. It plans to have 25% of its portfolio invested offshore and 75% invested in SA in the next five years.

Source: Business Day

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