Vukile Property’s Spanish subsidiary secures strategic stake in peer group
27 January 2022 - 10:20
byAndries Mahlangu
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Vukile’s flagship Spanish shopping centre, the El Faro centre in Badajoz. Picture: SUPPLIED
Vukile Property Fund said on Thursday that its Madrid-listed subsidiary, Castellana Properties Socimi, had acquired a 21.7% shareholding in its market peer, Lar España Real Estate Socimi, for €100m or R1.72bn.
Vukile’s assets, worth R33.4bn, are spread between SA (49%) and Spain (51%). The Spanish assets are held through its 88%-held subsidiary Castellana, which is the seventh-largest retail landlord in Spain.
The proposed transaction, which will be funded in cash and shares, is set to give Castellana exposure to the entire Spanish peninsula.
Lar España, which has a portfolio of 14 assets offering more than 550,000m² of gross lettable retail area, has a high occupancy rate of 95%, catering to mostly large international and national tenants.
“We strongly believe Lar España is an undervalued stock that is due to re-rate. This makes it a very attractive investment opportunity indeed, and one that we understand well, given the many similarities between Castellana and Lar España,” Vukile CEO Laurence Rapp said in a statement.
The transaction will have an immediate positive effect on Vukile’s funds from operations on a per share basis in the 2022 financial year, the JSE-listed company said.
But the transaction will have a neutral effect on its debt relative to assets, as measured by loan-to-value ratio.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Vukile Property’s Spanish subsidiary secures strategic stake in peer group
Vukile Property Fund said on Thursday that its Madrid-listed subsidiary, Castellana Properties Socimi, had acquired a 21.7% shareholding in its market peer, Lar España Real Estate Socimi, for €100m or R1.72bn.
Vukile’s assets, worth R33.4bn, are spread between SA (49%) and Spain (51%). The Spanish assets are held through its 88%-held subsidiary Castellana, which is the seventh-largest retail landlord in Spain.
The proposed transaction, which will be funded in cash and shares, is set to give Castellana exposure to the entire Spanish peninsula.
Lar España, which has a portfolio of 14 assets offering more than 550,000m² of gross lettable retail area, has a high occupancy rate of 95%, catering to mostly large international and national tenants.
“We strongly believe Lar España is an undervalued stock that is due to re-rate. This makes it a very attractive investment opportunity indeed, and one that we understand well, given the many similarities between Castellana and Lar España,” Vukile CEO Laurence Rapp said in a statement.
The transaction will have an immediate positive effect on Vukile’s funds from operations on a per share basis in the 2022 financial year, the JSE-listed company said.
But the transaction will have a neutral effect on its debt relative to assets, as measured by loan-to-value ratio.
mahlangua@businesslive.co.za
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