EMIRA MILESTONES OVER THE PAST DECADE
Over the past 11 years, Emira Property Fund has risen above both global economic recession and shifting market fundamentals to earn its place as one of SA’s listed property mega-funds. Reaching – and passing – a ten-year anniversary provides an ideal moment to pause and reflect on the fund’s activities and history.
Emira was listed on the Johannesburg Stock Exchange in late 2003 with an initial portfolio of 77 properties and an asset base of R1.65 billion. The listing price was 500 cents per PI and the fund’s market capitalisation stood at R1.35 billion. Since then, the fund has continued to consistently build value for its unitholders – and mark some remarkable milestones along the way. For two years after listing, the fund grew by leaps and bounds, accelerated by strategic acquisitions and the steady capital appreciation of existing properties as well as a proactive and skilled executive team.
By 2005, the market capitalisation had all but doubled, to R2.07 billion, representing an additional 720 cents per PI. At that time, an opportunity arose to acquire an R844 million stake from Eris and the Momentum Group in a deal that allowed the fund to participate in BEE initiatives in a real and meaningful way. Emira’s commitment to, and involvement with, SA’s Property Transformation Charter continues to this day. As a fund, Emira has striven to be forward-thinking, recognising innovative solutions when they emerge. For instance, the fund was an early adopter of new thinking around management fees and was the first to restructure fees payable for property management to cost recovery only.
In 2006, the fund was the first collective investment scheme in property (CISP) to raise funds – some R650 million – in the debt capital markets, using commercial mortgage-backed securities. One of Emira’s first acquisitions using debt financing, in 2007, was Freestone, a property loan stock company with a mixed portfolio of commercial, retail and industrial properties worth R1.8 billion.
Three years later, in 2009, a strong credit rating, solid track record and established relationship with Rand Merchant Bank allowed for the securing of a long-term debt facility at favourable margins. Funds raised were used to refurbish, renovate and redevelop the portfolio, optimizing value and acquiring strategic new assets. In 2010, the fund decided to invest farther afield and became the first CISP to invest in an Australian, buying a R234 million stake in Growthpoint Australia. Another milestone was when Emira then became the first CISP to issue a corporate bond, raising R500 million from institutional investors in 2011. Most recently, just a year ago, Emira was granted REIT status by the JSE, bringing the fund in line with international best practice. The new REIT status generated a positive financial impact for Emira, reducing deferred capital gains tax by R205 million and boosting the fund’s Net Asset Value (NAV) by 41.2 cents per PI. In 2014, Emira achieved another first: the purchase of Menlyn Corporate Park, the largest single acquisition by the fund at R614 million. This year also saw the much-anticipated completion of the R540 million Wonderpark Shopping Centre as well as the acquisition of a portfolio of R830 million from Integri-t Property Fund to broaden portfolio exposure to both the retail property sector and the Western Cape market. Today, Emira has grown its total asset base to R12,5 billion, comprising a portfolio of 141 properties, as well as an investment in an Australian REIT.
Looking to the future, an ongoing commitment to optimizing distributions and growing net income means Emira is well-placed to keep building value for unitholders. As Emira grows from strength to strength, with clear strategic priorities and a dedicated team, it is safe to say many more milestones lie ahead.