SA’s LISTED PROPERTY: Consolidation gaining momentum
Consolidation in the South Africa’s listed property sector may come back into vogue after having slowed down in May.
Earlier this week Redefine Properties acquired 11% of Emira Property Fund, a mid-cap stock, in a deal worth about R880m.
Redefine chairman Marc Wainer said he was impressed by Emira’s turnaround over the past few years. “It could become a takeover target in the future, so what we have here is a strategic stake.
“We would have liked more than 11% but it’s a start.”
Analysts say that apart from a few more funds taking up stakes in others before the new year, we may soon see a surprise takeover bid. There is still time for one of the big funds to buy out a smaller one.
Redefine and Growthpoint are so much bigger than the other listed property players, together making up more than half of the sector, that it is decidedly lopsided.
Growthpoint, the biggest locally based JSE-listed fund, is already looking to buy out Acucap Properties and Sycom Property Fund, two funds that share the same management company and are soon to merge.
By the middle of 2015 SA’s property sector may have fewer counters, but it will have greater liquidity and should therefore be able to attract more institutional investors.