Listed property group Texton Property Fund will dispose of its Western Cape office properties, which include Loop Street, Foretrust and certain sections of Wale Street Chambers.
Texton owns industrial, office and retail assets in SA and the UK valued at R3.6bn.
In SA, the company has 35 properties in KwaZulu-Natal, Gauteng and the Western Cape measuring 249,327m² of total gross lettable area (GLA), and seven assets in the UK measuring 51,981m².
In a Sens announcement on Friday, the company said it is able to sell the assets at an attractive price to its current book value and secure a profitable exit.
Sale proceeds will be used to repay debt and further strengthen the company’s balance sheet. The funds will also provide Texton with the capital to diversify investment into other attractively priced asset classes.
The properties were valued at R397m at the end of June 2021, and they have strong lease agreements with government tenants with a weighted average lease expiry of 3.7 years.
Collectively, the properties represent 19% and 22.7% of the company’s SA portfolio value and net operating income, respectively, said the company. In June it said it had identified 16 noncore properties valued at R601.2m for disposal.
It then added five properties to that list, and had sold 12 properties, realising R712m, by the end of the financial year in June.
A further three properties valued at R177.1m were transferred after the financial year end.
The company said on December 15 it entered into two separate sale-of-property agreements with Stonehill Property Group Limited to sell Wale Street Chambers, and Foretrust Property and Loop Street Properties.
In terms of the JSE listings requirements, both sales contain standard warranties and undertakings by both the buyer and seller. The Foretrust and Loop Street sale needs to be approved by an ordinary resolution of company shareholders, with the conditions of both transactions likely to be satisfied by April 12 2022.
In terms of the Wale Street agreement, various sectional title units with a GLA of 3,051m² will be sold. In total, the office property measures 6,274m².
The Foretrust property measures 4,370m², while the five Loop Street properties have a combined GLA of 466m².
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.