Grit now aiming for Sapy listing

PANAFRICAN REAL ESTATE: VALUE OF FUND AT $800M

Remarkable growth in value followed LSE listing.

With Mauritius-based Grit Real Estate Income Group being one of the best performing property stocks on the JSE last year (in terms of capital appreciation), the Africa-focused fund plans to continue its listing in Johannesburg, despite listing on the London Stock Exchange last year.

That’s the word from Grit CEO Bronwyn Corbett, who said the group was now looking to be included in the influential FTSE/ JSE South African Listed Property Index (Sapy).

She was commenting on the company’s results for the six months ending December 31, 2018, which showed net property income increased to US$25.4 million from $17.5 million the prior year. Corbett said: “Grit is one of the better performing shares on the JSE, up some 20% over the last year. We also grew the group quite significantly after our listing on the London Stock Exchange (LSE), which saw Grit increasing its portfolio to 25 properties worth about $800 million.

“With plans to double the size of the business over the next two years, Grit is likely to be included in Sapy, which would boost its profile by opening Grit to tracker funds and increasing its share liquidity.”

The Sapy comprises the top 20 most liquid listed property companies by market capitalisation with a primary listing on the JSE. Grit is multi-listed and trades on the JSE, LSE and the Stock Exchange of Mauritius.

At the Africa Property Investment Summit last year, Corbett hinted at reducing the number of international bourses the company trades on, after its London listing in July. But this week she said it would continue to be a multi-listed player.

“With regards to the JSE, our share price has done very well over the past year. We plan to remain JSE-listed as we want to get into the Sapy. Our London listing was aimed at playing more globally to lure UK and international investors. Grit is the only listed Africa-focused income distribution group that offers international property investors access to high growth opportunities in thriving African economies outside of SA,” she said.

“Through our London listing, Grit raised $132.2 million in new capital. We have deployed this into strategic acquisitions in Ghana and Mozambique, which has had a positive impact on the company’s net asset value, but the capital raise and income distributions offset some of this value uplift.

“Grit’s income-producing asset value increased by 19.8% to $796.3 million during the reporting period, after the successful deployment of the capital raised from the London listing.”

Grit has a presence in seven countries on the continent currently. Office and retail properties make up 60% of its portfolio, hospitality 20.5% and light industrial and “corporate accommodation” makes up the balance.

Stanlib portfolio manager and analyst Ahmed Motara said Grit was doing a good job by targeting properties with largely multinational blue-chip tenants.

Income producing asset value increased 19.8%