Commercial and warehouse buildings developer Heartwood Properties has declared its first dividend, of 1.52c, amounting to an R2m payout, although its profit fell more than a third.
“We have a policy of selling some assets after a four to five-year initial period has been implemented, which then allows us to pay dividends,” CEO John Whall said on Thursday when the company released results for the year to end-February.
Heartwood listed on the Cape Town Stock Exchange (CTSE) in March 2018 and is now valued at R131m. With a portfolio of eight properties valued at R279m, it focuses on the urban logistics sector with warehouse and retail warehouses in Gauteng and the Western Cape.
It partners with entrepreneurs who want something back for paying rent, so clients receive a percentage of shareholding if they sign a 10-year lease on a property. The weighted average length of leases are just more than five years and the occupancy rate is 100%.
Some of its latest developments include a Build It in Somerset West, an office development in Somerset West and a warehouse for Alveo Water in Cape Town.
“We are fortunate and grateful to have such a vast selection of new developments in the pipeline and will be soon looking to raise more capital to help fund these new-builds,” Whall said.
The group saw its net profit after tax drop 37.2% to R14.43m due partly to rising operating expenses.
No Heartwood property was damaged in the July 2021 unrest. It does not foresee a major impact on the business from the war in Ukraine.
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