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OCT
OCT
OCT - Octodec - Announcement regarding the acquisition of properties
OCTODEC INVESTMENTS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1956/002868/06)
ISIN: ZAE000005104
Share code: OCT
("Octodec" or "the Company")
ANNOUNCEMENT REGARDING THE ACQUISITION OF PROPERTIES
1. Introduction
Octodec linked unit holders are advised that Presmooi (Proprietary) Limited
("the purchaser"), a wholly owned subsidiary of Octodec, has entered into
various agreements for the acquisition of five properties ("the
properties") as detailed below ("the acquisitions"):
1.1 an agreement with Afhco (Proprietary) Limited ("Afhco") for the
purchase of the property and letting enterprise commonly known as
"Castle Mansions", situated at 170 Jeppe Street, Johannesburg, Gauteng
for a purchase price of R40 720 000;
1.2 an agreement with Afhco for the purchase of the property and letting
enterprise commonly known as "Raschers", situated at 70 Loveday
Street, Johannesburg, Gauteng for a purchase price of R5 875 687;
1.3 property and letting enterprise commonly known as "Temple Court",
situated at 169 Jeppe Street, Johannesburg, Gauteng for a purchase
price of R7 810 770;
1.4 an agreement with Rapiprop 101 (Proprietary) Limited for the purchase
of the property and letting enterprise commonly known as "Record
House", situated at 86 Eloff Street, Johannesburg, Gauteng for a
purchase price of R10 600 672; and
1.5 an agreement with Purple Fountain Properties 59 (Proprietary) Limited
for the purchase of the property and letting enterprise commonly known
as "Medical Towers", situated at 179 Jeppe Street, Johannesburg,
Gauteng for a purchase price of R14 521 649.
The effective date of each of the acquisitions is on the date of transfer
of each of the properties to the purchaser, which is expected to be during
August 2010.
2. Rationale for the acquisitions
In line with Octodec`s strategy of actively pursuing redevelopment and
investment opportunities that will enhance the overall quality and value of
its portfolio, the acquisitions represent attractive investments situated
in the Johannesburg Central Business District.
3. Consideration for the acquisitions
The total purchase consideration for the acquisitions is R79 528 778
(seventy nine million, five hundred and twenty eight thousand, seven
hundred and seventy eight rand) ("the purchase consideration"). The
purchaser will be liable for the commission, transfer duty and other costs
in the amount of R5 831 772 (five million eight hundred and thirty one
thousand, seven hundred and seventy two rand) in respect of the
acquisitions. In addition, the purchaser has budgeted to spend an amount of
approximately R2 700 000 (two million seven hundred thousand rand) on the
upgrading of certain of the properties and elevators.
4. Unaudited pro forma financial effects of the acquisitions
The unaudited pro forma financial effects of the acquisitions on net asset
value and net tangible asset value per unit have not been disclosed as they
are not significant.
5. Forecast information on the acquisitions
The summarised forecast financial information relating to the acquisitions
for the one month ending 31 August 2010 and for the twelve months ending 31
August 2011, which is the responsibility of the Company`s directors, is set
out below. The forecast financial information has not been reviewed and
reported on by Octodec`s auditors.
Forecast Forecast
1 month ending 12 months ending
31 August 2010(1) 31 August 2011
R R
Gross rentals 1 038 511 13 207 280
Contracted revenue 1 038 511 13 207 280
Uncontracted revenue 0 0
Net rental income before interest 726 778 9 307 281
Net profit after interest 7 616 677 343
Notes:
1. The forecast information for the 1 month ending 31 August 2010 has
been calculated from the anticipated effective date of the
acquisitions, 1 August 2010.
6. Conditions precedent
There are no conditions precedent relating to the acquisitions.
7. Specific information relating to the properties
Details regarding the properties are set out below:
Proper Location Sector Gross Single Weighte Annuali Total Value
ties lettab or d sed purchas of
le multi- average propert e price propert
area tenante rental y yield of y Rm
m2 d per m2 (1) propert (3)
R y
Rm(2)
Castle ERF 4729, Retail & 9 145 Multi- 57 10.4% 45 292 45 292
Mansio Johannesb 123 tenante 714 714
ns urg residenti d
Township, al units
Registrat
ion
Division
I.R.,
Province
of
Gauteng
Medica ERF 4448, Retail, 7 472 Multi- 28 11.2% 15 064 15 064
l Johannesb offices & tenante 907 907
Towers urg parking d
Township,
Registrat
ion
Division
I.R.,
Province
of
Gauteng
Rasche Section 1 Retail 852 Multi- 76 10.7% 6 116 6 116
rs of tenante 336 336
sectional d
title no
SS127/200
9 of ERF
4 843,
Johannesb
urg
Township,
Registrat
ion
Division
I.R.,
Province
of
Gauteng
Record ERF 866, Retail & 2 894 Multi- 53 10.5% 11 504 11 504
House Johannesb 41 tenante 103 103
urg residenti d
Township, al units
Registrat
ion
Division
I.R.,
Province
of
Gauteng
Temple ERF 1263, Retail & 2 774 Multi- 54 10.5% 10 082 10 082
Court Johannesb 41 tenante 490 490
urg residenti d
Township, al units
Registrat
ion
Division
I.R.,
Province
of
Gauteng
Total 23 48 10.6% 88 060 88 060
137 550 550
Notes:
1. Based on the forecasted net rental income before interest for the 12
months ending 31 August 2011.
2. After taking into account transfer fees, commission and other costs
amounting to R5 831 772 as well as elevator and other upgrade costs
amounting to approximately R2 700 000.
3. The value of the properties of R88 060 550 was arrived at by a
director`s valuation as at 12 May 2010.
8. Categorisation
The acquisitions constitute a Category 2 transaction in terms of the JSE
Limited Listings Requirements.
21 May 2010
Johannesburg
Investment bank and sponsor
Nedbank Capital
Date: 21/05/2010 15:00:01 Produced by the JSE SENS Department.
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