Vividend to focus on plans to recover charges
Category Property Fund News
Property loan stock company Vividend Income Fund CEO Ari Jacobson said on Thursday the main focus of the fund, over the coming months, would be to garner more efficient processes for recovering council and common-area charges.
Vividend, which listed almost two years ago, last week reported a 146% increase in distributions for the six months ended February, to 24,5c, compared with 9,96c in its previous interim period.
The fund is forecasting a full-year distribution of 50,5c per share and Mr Jacobson said the target was comfortable, given the benefits associated with the larger Vusani portfolio, which would come on stream from this month.
Garnering more efficient processes for recovering council and common-area charges would hopefully add to the bottom line in the next reporting period, Mr Jacobson said.
He said issues surrounding the fixing of debt funding and the transfer of the newly acquired R790m Vusani portfolio were now almost resolved and the end result was a positive outlook for the fund.
"Given the progress associated with the transfer of the Vusani portfolio into its name and the current indicative costs associated with the funding facility secured by the company, the board is confident Vividend would achieve its forecasted unitholder distribution of 50,5c for the financial year ended August."
The company said it had secured a debt funding facility of R500m prior to the end of February at an interest cost of Johannesburg Interbank Acceptance Rate plus 215 basis points.
The funding facility would be introduced into the portfolio at a loan-to-value of 30% and would facilitate the acquisition of the Vusani Portfolio from Vusani Property Investments for R790m and future expansion of the property portfolio, either through refurbishment or acquisition.
The revaluation of the property portfolio at the end of February resulted in an upward revision of R8,2m, to R531m, mainly due to an increase in the future contractual rental applicable to the properties.
The vacancy rate was at 4,2% of the portfolio at end-February.
Mr Jacobson said the fund continued investigating a consistent stream of opportunities falling within its primary scope of targeting value- and yield-enhancing assets within the retail, commercial and industrial property sectors of SA.
Although Vividend was operating in a challenging economic environment, the fund said considerable progress had been made in creating a high-quality, stable and well- diversified portfolio that was well- positioned to take advantage of leveraged acquisition opportunities that may present themselves.
"We are also very hands-on in terms of leasing and general management — it is so much easier if you have only 19 properties."
Mr Jacobson said this form of management, with its close-to-the-ground approach, may be the distinguishing characteristic in a market that was becoming overcrowded with smaller players.
Author: Warehouse Finder
