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Arrowhead Enhances Residential Portfolio

9 Dec 2013
by PropertyWheel
2 min read
Gerald Leissner, CEO of Arrowhead

Gerald Leissner, CEO of Arrowhead

Arrowhead Properties, the only JSE listed property company to pay quarterly distributions, today announced that it has concluded an agreement with Standard Bank for the acquisition of 333 residential units at an aggregate purchase consideration of R150 million payable in cash, all of which are let to Monash South Africa Limited (“Monash”) on a triple net lease. Monash in turn sub-lets the units to students who attend the university.

“This acquisition furthers Arrowhead’s strategy of expanding its residential property portfolio and, at a forward yield of approximately 12%, is in line with our focus on distribution enhancing acquisitions,” commented Gerald Leissner, CEO of Arrowhead.

“It has significantly enhanced our residential portfolio offering at rental of R5 982 per unit. The triple let lease and the fact that there is in essence only one tenant from our perspective makes this an extremely attractive investment,” he added.

This is Arrowhead’s second major residential acquisition, which together with the previously announced Jika portfolio, takes the combined residential portfolio to approximately R550 million. Since listing on the JSE in December 2011, Arrowhead has grown its asset value from R1.4 billion to R4 billion.

The transaction is subject to competition commission approval and Arrowhead expects the effective date to be 1 February 2014.

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