Delta Property Fund, which is a landlord to government and corporate tenants nationwide, has sold the “LexisNexis” property in Durban to Icebolethu Funerals for nearly R40m.
This as the company, which is valued at over R207m on the JSE, disposes of its non-strategic assets to reduce debt, cut costs and lower vacancies.
The sale will take effect on September 30, when the ownership will be officially registered under Icebolethu Funerals, a prominent player in the funeral services sector with over 120 branches nationwide.
In the announcement published on Tuesday, Delta said the disposal consideration includes a non-refundable deposit of R1.6m, already paid, and the balance of R35.77m secured by guarantees due on the transfer date.
“As part of Delta’s strategy and the optimisation of the portfolio, it was agreed that the disposal of assets which were no longer strategic to the company would be undertaken. LexisNexis is considered one such asset,” the company said.
“The net proceeds of R32.5m will be utilised by the company to reduce debt and the loan-to-value from 60.9% to 60.7% and to reduce vacancy levels from 33.4% (on February 29) to 33.2%.”
Delta’s decision to sell the LexisNexis property stems from its evident underperformance. The property, which has a gross lettable area of 3,354m2 (about two-thirds the size of a football pitch), reported a net operating loss of R2.2m and a 100% vacancy rate in February.
At the time, the property was independently valued at R32.7m, according to a registered professional valuer.
At the time of its latest financial results in November, Delta announced that it was in advanced negotiations to sell 29 properties and aimed to offload a total of 43 assets valued at R2.2bn. Earlier in 2024, the company successfully sold three properties for R105.1m and has agreements to sell two more for R19.3m.
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