JSE-listed Emira Property Fund continued to gain momentum in the year to August, growing its distributions per share 7.5%, it reported in its financial results on Wednesday.
This was up from its half-year distribution growth of 6.5%.
Emira’s vacancies have steadily decreased of late. They fell from 10.2% for the financial year 2012 to 5.6% for 2013 to 4.5% for 2014. The group’s net asset value increased 9.2% during the year to R14.47 per unit.
The group has a market capitalisation of R7.57bn and is trying to become a medium-sized R10bn property fund in the next year or so.
CEO James Templeton said market perceptions of Emira were improving. “Emira is on the right website track. Our amplified performance is driven by improved operations. It builds on Emira’s positive turnaround for investors and delivers on our promise of real growth in distributions.
“We’ve delivered on every one of our key performance indicators set by the board in the past financial year and we intend to continue on this path,” Mr Templeton said.
Improvement in distribution
Emira was expecting a further healthy improvement in distribution growth in its 2015 financial year.
“During 2014, Emira achieved the highest occupancy level across its portfolio since 2005. The benefit of our improved occupancies and our forecast containment of property expenses in the coming year will drive another year of good performance in 2015, should there be no major deterioration in the economy,” he said.
Listed on the JSE since 2003, Emira Property Fund began trading as a real estate investment trust (Reit) from July 1 last year.
It has a diversified portfolio of office, retail and industrial properties. Its assets comprise 141 properties valued at R10.8bn.
Emira is also internationally diversified through its interest in Australian stock exchange-listed Growthpoint Properties Australia. This investment was valued at R666m at the end of June.
Alternative Real Estate Capital Management’s Maurice Shapiro said the results were impressive and that Emira had been achieving strong performances on a reliable basis.
“Prospects for the company are positive with Reit-status accounting allowing for an extra 2% distribution growth on top of the expected 7.5% growth possible for financial year 2015,” he said.
“We also note the highly positive impact that Growthpoint Australia has had for the fund, which should continue to drive solid predictable earnings growth.”
Emira has not been particularly aggressive on the acquisitions front, choosing to be cautious in a market where funds may buy too aggressively, according to Evan Robins, portfolio manager at Old Mutual Investment Group.
Subsequent to the June financial year-end, Emira acquired three buildings in the Highgrove Office Park, Centurion, for R24.6m. This took the fund’s exposure in this A-grade office park to R157.9m.