In possibly the strongest demonstration of its commitment to the retail and previously disadvantaged sectors, Nedbank not only provided the R255 million finance for the building of the new Protea Glen Mall in Soweto, but has also taken an equity stake.
Protea Glen, which opened in late September, is set to become the suburb’s leading shopping centre, boasting 30 000m2 of popular retail stores.
The Masingita Group of Companies and Nedbank have a strategic partnership in township and rural development that focuses on adding value to the growth and development of under-serviced communities.
Ken Reynolds, regional executive: Nedbank Corporate Property Finance, Gauteng says, “Our partnership with Masingita goes back to 2005 and we are joint shareholders in Masingita Property Investment Holdings (MPIH) in which the Masingita Group of Companies holds 65% and Nedbank holds 35%. Through MPIH we have developed and sold Bara Mall and Diepsloot Mall, developed and own Masingita Mall in Giyani and acquired and hold a 45% stake in Jabulani Mall, with the other 55% being held by Resilient. Together with a new partner, Vlaming (Pty) Ltd, MPIH have now brought Protea Glen Mall to market.”
The investment arm of Nedbank Corporate Property Finance has taken a 23.5% equity share in the development, and the remaining equity is held by Masingita Properties (43.5%) and Vlaming (Pty) Ltd (33%).
Protea Glen Mall is poised to capitalise on the rapidly developing middle income residential area of Protea Glen in Soweto which some experts have referred to as the “fastest growing suburb in the country”.
The centre houses more than 90 shops, including popular retailers such as Shoprite, Pick n Pay, Truworths, Edgars, Markhams and Clicks. Merchandise in the stores is of an upmarket nature which suits the more affluent status of the area. All the major fast food chains are represented in the centre including KFC, Macdonalds, Debonairs and Steers, as well as the major banks, Post Office, and cellular phone service providers.
Reynolds says that its investment arm seeks to identify sound commercial, industrial and retail property development projects requiring additional capital. The division operates in the upper echelons of the property market where it participates with clients as co-developer, partner and investor either by means of joint ventures, profit shares or minority equity investments in commercial, industrial, retail and residential property developments. “Such investment is undertaken through the provision of mezzanine finance or through direct equity investment and we also hold investments in both the listed and private property funds,” he says.
In addition to the developments where Nedbank Corporate Property Finance is an equity partner under the MPIH banner, the division has funded the following developments on behalf of Masingita: Mangalani BP and retail centre, Masingita Plaza (retail development in Giyani), Sindowanye (copper recycling facility in Germiston) and the War College (South African National Defence Force accommodation and facilities in Pretoria).
The driving force behind Masingita Properties is Mike Nkuna, a respected leader in the South African business community, who is widely regarded as one of the pioneer developers of property in previously disadvantaged areas. The group has an existing portfolio of properties valued in excess of R406 million, mainly comprising retail properties in rural areas of South Africa.