- Acquisition to grow Indluplace portfolio by 24% to 6 830 units.
- R475 million acquisition.
- Yield enhancing acquisition.
Indluplace Properties Limited today announced that it has concluded an agreement with Diluculo Investments Pty Ltd to acquire Diluculo Properties Pty Ltd which owns a property portfolio of 1 319 residential units for R475 million. The transaction is subject to Competition Commission approval.
The portfolio comprises eight properties, mainly spread across Gauteng with one property located in Bloemfontein. Approximately 55% of the units are situated in townhouse complexes with the remainder in suburban blocks. 40% of the units are located in the Johannesburg and Pretoria CBDs. The majority of the portfolio to be acquired comprises two bedroom apartments, 34% are one bedroom units and 10% bachelor units making up the rest.
“We are pleased to announce the acquisition of Diluculo Properties. The portfolio fits well with the diverse nature of our current portfolio, being diverse in location, building type and unit type. It will bring the new total of our residential units to 6 830, emphasizing the potential to grow the fund aggressively over time,” said CEO, Carel de Wit.
The average rental across the residential units is around R4 000 per unit per month. The portfolio has very well controlled vacancies of under 3%.
Indluplace’s strategy of outsourcing property management, with standardised property management systems, allows for the merging of such portfolios into its current operations. CSI Rentals and Zelri Properties manage between them approximately 66% of the portfolio and are already entrenched in Indluplace where they manage a considerable portion of the current Indluplace portfolio, making the transition seamless with minimal impact on operations and tenants.
“Considering our low loan to value ratio of 8%, we are in discussions with various banks to fund this transaction. The acquisition is yield enhancing to Indluplace and we continue to remain upbeat about Indluplace’s prospects within the residential market,” said Terry Kaplan, FD of Indluplace.