Inkunzi to list on JSE next month

INKUNZI Student Accommodation Fund (ISAF) is set to become the JSE’s first specialist student housing real estate investment trust (Reit) when it lists on the bourse in September.

Kameeel Keshav, the chief executive and joint founder of Inkunzi, said yesterday that it expected to list with a portfolio of 12 properties comprising 6 500 beds valued at R2.25 billion that would be acquired at the same time as the listing from seven different private property developers.

Keshav said the rationale for the listing was to get cash from institutional and private investors to acquire the properties.

He said Inkunzi had identified an immediate acquisition pipeline of R2.5bn and entered into first right of refusal agreements with the developers of these properties.

Owen Nkomo, the chief investment officer of Inkunzi and a co-founder of the fund, said they would also partner with developers on greenfield projects.

The plan is to raise R1.7bn through a private placement prior to listing.

Keshav said they were looking for between 25 percent and 30 percent direct black ownership in Inkunzi, including an incentive structure for the fund’s about 130 employees.

BEE staff scheme

“We’re focusing on creating a platform for true broad-based empowerment through our staff incentive scheme facilitating the opportunity for staff to own a stake in the company they work. This means from the chief executive to the security guards and cleaning staff at the assets will all own a share in ISAF,” he said.

The assets that would be acquired at listing were at the University of Pretoria, the University of Johannesburg, Vaal University of Technology, North West University, and the Nelson Mandela Metropolitan University in Port Elizabeth.

Keshav said they were excited about the planned listing because it addressed one of South Africa’s key issues of student accommodation apart from the strong socio-economic aspect through the direct black ownership.

“Inkunzi brings something unique and fresh to the listed real estate space, offering investors direct access to a counter-cyclical asset class.

Keshav said the Department of Higher Education and Training estimated there was a shortfall of about 25 000 beds for students in the country.

Nkomo said Inkunzi’s loanto-value at listing was expected to be about 25 percent, which provided some headroom for growth.