Emira Property Fund’s net asset value increased 12.3% to 1 945.50 cents a share for the six months to September 30, following rising property valuations and fair value gains from its maiden investment in Poland.
Interim distributable income per share increased by 6.9%. A 1.1% higher interim dividend per share of 62.39c was declared.
CEO Geoff Jennett said operational metrics were strong, asset recycling was actively managed, and the portfolio was reshaped.
He said Emira was on track to deliver on its objectives for the full year - marginally higher distributable income from the previous year was forecast.
The local portfolio had outperformed over the half year, and the US investments were on track. The first tranche of the investment into DL Invest in Poland had been made.
Emira invested €55.5 million (R1.06 billion) for an initial 25% stake in DL Invest Group, a Luxembourg-based property company developing logistics centres, mixed-use/office complexes, and retail parks, valuing its assets at €730m and net asset value (NAV) at €278m pre-investment.
Emira has the option to expand its position to 45% by investing an additional €44.5m before January 31, 2025. Castleview Property Fund, which holds about 58% of Emira’s shares, plans to support the exercise of the option.
DL Invest Group has a 17-year track record in Polish commercial real estate, with a €730m portfolio focused mainly on logistics.
Emira’s investment would fund DL Invest Group’s logistics development pipeline. The partnership aligned with Emira’s co-investment strategy with in-country specialists.
Funding for the first tranche of investment came from Emira’s balance sheet and recent disposals. Non-core commercial and residential property sales in the period came to R2.6bn.
The balance sheet remained healthy. The loan-to-value ratio declined to 42% from 42.4% and was expected to decrease further; a portion of the proceeds of non-core asset sales would be deployed to reduce debt.
Unutilised debt facilities stood at R370m, and cash of R112.8m would increase as proceeds from disposals were realised.
The Poland investment increased Emira’s international investments to 26.8% of its portfolio — with 15.5% in the US and 11.3% in Poland — while 73% remained in South Africa. The second tranche option created the potential for this to become nearly 37% offshore.
Emira’s direct South African portfolio comprises 84 properties worth R12.1bn across commercial property sectors and residential rental property. Emira’s exposure to the US, with US partner The Rainier Companies, involves equity interests in 12 value-oriented grocery-anchored centres.
The local portfolio surpassed most key targets. SA commercial vacancies tightened to 3.9% from 4.1%. The portfolio saw an increase in like-for-like valuation of 4.7%.
The 15-property directly held retail portfolio of mainly grocery-anchored neighbourhood centres was trading well with improved metrics, including low vacancies of 4.2%.
Emira’s portfolio of 20 mainly P- and A-grade office properties saw office vacancies improve into single-digit territory, from 10.9% to 9.4%.
Emira’s industrial portfolio of 28 properties saw strong demand at near full occupancy, with vacancies stable at 0.7%.
Residential rental assets comprise 21 properties, or 17% of Emira’s directly held SA portfolio by value, including The Bolton in Rosebank, Johannesburg, and the 20 affordable units of Transcend Residential Property Fund, Emira’s wholly-owned specialist residential company.
The portfolio was achieving rental growth, with sustained demand for accommodation.
“Emira’s strategic pivot is in full swing...These solid half-year results put us firmly on track for a marginal increase in distributable income for 2025, reinforcing Emira's consistent record of reliable performance,” said Jennett.
BUSINESS REPORT