SOUTH AFRICA – Attacq, the South African retail, office, and industrial real estate investment trust (REIT), has sold about half its stake in central and eastern Europe focused MAS over the past three months, with the proceeds going towards debt reduction.
The results for the six months to December 31, 2020, showed Attacq sold 69.67 million shares in MAS for US$59.2 million cash, cutting its shareholding from 20.7 percent at the end of the interim period, to 10.9 percent.
“A minimum of US$66.9 million of debt will be settled permanently by June 30, 2021, from disposal proceeds. When further property disposal transactions close, additional debt will be settled from disposal proceeds,” the group said.
Attacq is trading under a cautionary notice relating to the proposed disposal of an investment property.
Attacq, which counts Waterfall City in Johannesburg as a flagship development, reported a 57.5 percent drop distributable income per share to 21.1 cents a share in a six-month period characterised by economic weakness and uncertainty.
No dividend was declared, and no guidance was provided.
The decline was mainly due to US$3.6 million in rental discounts granted, and MAS not paying a dividend given the Covid-19 pandemic uncertainty.
Chief executive Melt Hamman said in a statement: “Attacq’s diversified and quality property portfolio and diligent capital management plus its debt reduction plan supported us in this period and will ensure we are well-positioned to benefit from a future recovery.”
MAS reported a distributable loss per share of 2.7c in the period for Attacq, after also not declaring an interim dividend.
“Attacq’s diversified and quality property portfolio and diligent capital management plus its debt reduction plan supported us in this period and will ensure we are well-positioned to benefit from a future recovery”
Melt Hamman – CEO, Attacq
In contrast, Attacq’s US$1.34 billion South African portfolio produced distributable income of 26.5c per share.
There was no distributable income contribution from the US$26.8 million rest of Africa retail investments.
Group liquidity improved to US$87 million from US$64.4 million at the same time in 2019.
The rental collection rate for the South African portfolio was 100.6 percent, better than the 98.8 percent at the same time in 2019, which was pre-Covid.
Valuations of the South African portfolio fell 3.2 percent from June 30, 2020, on a like-for-like.
Occupancy in the portfolio improved to 96.4 percent from 94 percent while net asset value per share fell 26.6 percent to US$1.05.
The group further said that there were adequate liquidity resources to continue with the development pipeline.
“Good progress had been made with the disposal programme, and the exit strategy for rest of Africa retail investments continued. The focus was to continue to develop Waterfall into a smart, sustainable city, and over 31 000m² developments commenced post period-end, with a further 30 000m² of warehouse space under negotiation,” said Hamman.
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