Cape Town headquartered property group Equites – which has a large concentration of properties in the fast growing Airport Industria node – is ahead of its pre-listing targets. The company reported an 11% rise in earnings to 45,4c/share – which is almost 5% ahead of its initial projections. Equites also predicted that its target of holding a R4bn property portfolio by February 2016 would be achieved.
Significantly the company shifted its attention to Epping Industria after completing its 2,045m² extension of one of its properties in Airport Industria on time and under budget. Equities reported last month that it had started receiving rental from the newly completed Airport Industria extension from the start of September this year.
The company is now looking to developing a property acquired at 160 Gunners Circle in Epping Industria. The intention is to redevelop the site into an A-grade distribution centre. The project entails constructing a new 8,500m² distribution centre on the site a capital value of R72m. Equites directors pointed out that this was well within the company’s risk parameters for “untenanted, speculative developments.” Construction commenced early last month and should be completed in August next year.
Equites directors argued there was a high demand for A-grade industrial space in Epping Industria and that the market was currently experiencing very low vacancy levels. They also noted strong demand for modern distribution centres in the major logistics nodes. This demand, Equites CEO Andrea Taverna-Turisan explained, was supported by the continued centralisation of distribution by major retailers, increased levels of imports into South Africa and a shift towards online retailing.
At the end of August this year Equites had concluded acquisitions and development leases totalling more than R700m. Taverna-Tursisan said that the transactions would increase the portfolio value to more than R4bn.
Aside from its large Intaprop acquisition, Equites made several Western Cape acquisitions. These include the R52m acquisition of Atlantic Hills, a seven-hectare industrial park situated adjacent to the Potsdam off-ramp on the N7 highway in Cape Town. The acquisition includes a completed 3,499m² distribution centre that was developed at a cost of R35m for JF Hillebrand, a logistics company serving the wine and spirits industry. JF Hillebrand has entered into an eight-year lease, starting in December.
Equites also concluded a deal for the new Puma distribution centre and head office on the Atlantic Hills property. The capital value of the project is around R155m and the lease agreement lasts for almost ten years. Equites reckoned the Puma development would be completed in August next year.