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A landmark Black Economic Empowerment (BEE) deal has propelled investment holding company Zungu Investments into the property sector.
The company has successfully acquired controlling interest in 25 office properties across Gauteng, the Free State and Kwa-Zulu Natal from Emira Property Fund for R1.8 billion.
“We are extremely excited with the transaction,” said Sandile Zungu, executive chairman of Zungu Investments.
Zungu, who founded the 98% black-owned investment holding company, formed Shankly Property Investments, a BEE consortium with Emira Property Fund and One Property holdings, with a controlling share of 51%. Emira holds a 20% stake and One Property 21%.
“The transaction is a landmark BEE deal in both the property owning and property asset management space,” said Zungu. “It has allowed us to diversify our asset base at a time when the industry is ripe for new entrants that bring with them a solid investment track record and business acumen.”
With a track record of performance driven investments spanning more than a decade Zungu Investments also hold a majority interest in a property asset management company that will be formed as part of the deal.
The property portfolio situated in major business nodes such as Bryanston and Woodmead in Johannesburg and Menlyn Park in Pretoria, has an acquisition forward yield of 10.47% and a total GLA of c.158 500m2 with less than a 10% vacancy.
Zungu said the deal brought very real procurement benefits for its tenants, which was increasingly becoming a proportionately larger part of the BEE ratings for most businesses across industries.
With plans afoot to make a significant impact in the property sector through this acquisition and through further acquisitions, Zungu said there was much gratefulness to listed property group Emira that had been a catalyst in the deal.
For more detail go to www.zico.co.za.