FORTRESS INCOME FUND
KEY INDICATORS: R55.37bn ±R62bn Primarily industrial/logistics and retail and to a lesser degree office SA, and non-physical broad international exposure through its interests in listed counters Greenbay, Nepi, Resilient, Hammerson and Rockcastle 25.2% 93.5% (average term 4.1 years) A-class: 7.6%; B-class: 4.49% A-class: 1 buy, 1 sell, 1 hold; 2 sell, 1 buy (compiled by IRESS) Another Top40 company, Fortress is a hybrid REIT operating an A and B dual-share system. It invests in both physical and listed property securities, R30bn-odd of its R62bn assets coming from physical assets in SA, the balance in listed property stocks abroad.
Even while Fortress’s offshore exposure is around 50% through its investment in offshore stocks, further offshore exposure could be on the cards.
Notwithstanding that large chunk of offshore exposure, Fortress CEO Mark Stevens says the company is still very committed to SA. “We have a development pipeline of about R7.5bn, which we expect to invest over the next three years.
“Growth will pick up at some stage. Maybe not in the next year or so, but it is still a good place to do business. There are still lots of opportunities in SA.”
And if Fortress is unable to find quality assets, they will build them, says Stevens. That won’t necessarily be retail that Stevens says is over-shopped in a lot of nodes. But, he says, the company is firmly committed to the logistics side of the market. “That’s where we think there are big opportunities.”
Fortress previously forecast a 25% increase in distribution on its B-shares for the 2017 financial year, and Stevens says that forecast is still in place.