Octodec withdraws guidance due to Covid-19
The real estate company says it is negotiating with tenants and has diversified its sources of funding
JSE-listed real estate investment trust Octodec Investments has withdrawn its guidance and diversified its sources of funding as it prepares for the fallout from the Covid-19 pandemic.
The group, which has properties in the Johannesburg and Tshwane city centres, said it has recently secured a new R225m loan facility with Absa and is bracing for the prospect that some businesses may not be able to pay rent.
“Within reason, Octodec is committed to assisting its tenants to navigate through this challenging period and is dealing with requests for rental relief on a case-by-case basis, as a tenant-retention strategy.”
The group, which has a portfolio valued at about R12.8bn, said it has cash and undrawn facilities in excess of R600m, and remains well within its debt covenants.
Octodec had said in October it expected no distribution growth for its year to end-August 2020, but has now withdrawn this.
“The flat GDP growth, rife unemployment, reduced disposable income and the uncertain political environment remain at levels that are not conducive to local economic growth,” the company said at the time.
In afternoon trade on Tuesday, the share price was up 3.55% to R7.30, having fallen 52.44% so far in 2020.