Solid growth in Ingenuity’s assets

Property investment company builds its portfolio with a string of landmark acquisitions

PROPERTY investment and development company Ingenuity Property Investments lifted headline earnings a share by 25 percent to 2c for the year ending August 31, despite a greater number of shares in issue.

In the year under review, d u r i n g whi c h I n g e n u i t y achieved a solid 69 percent growth in its core asset base to R1.3 billion, the company completed a number of developments, including Newspaper House and the Atlantic Centre in the Cape Town CBD and Glacier Place, the third building on the Santam campus in the Tyger Valley precinct.

It also made some significant acquisitions during the year and into the new financial year. These included the Dreyer Street property in Claremont, for R82 million, and a portfolio of eight prime investment properties and a 67 percent stake in the Palmyra Junction shopping centre in Claremont for a combined R863m.

Others were the South African Revenue Service building at 17 Lower Long Street for R47m; Chamber House in Cape Town for R18.5m; and 64 White Road Retreat for R124.5m.

These transactions will take the value of the asset base to more than R2.3bn.

Chief executive Arnold Maresky says that Ingenuity’s strategic objective is the devel- opment and acquisition of quality Western Cape properties with attractive and growing incomes and development potential.

“Over the past five years, we have focused on the development and redevelopment of older sites. The result of these activities, together with the strategic acquisitions in recent years, provide a solid base and defensive underpin for the company. Achievements, particularly since the year-end, have bolstered Ingenuity’s prospects.”

This has allowed the company to increase the dividend to 1.5 cents a share, Maresky says.

Borrowings remain at conservative levels, with the gearing ratio at 52 percent (last year 46 percent), which is acceptable given the development nature of the company and that it seeks to maximise growth by leveraging its core asset base.

Maresky says a successful capital- raising exercise was concluded after the year-end wit h major i nst i t ut i o nal investors, in which 156.5m shares were issued at 80c each. The proceeds will be used to reduce debt and fund growth.

The board has decided to convert the company to a real estate investment trust, which it aims to implement during t h e 2 0 1 4 f i n a n c i a l y e a r, Maresky says.

REVAMP: Ingenuity Property Investments bought Newspaper House in Cape Town’s central business district.