| Tue 29 Jun 2010, 11:31 | | VKE - Vukile Property Fund - Expects trading improvement in 2011 |
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VKE
VKE
VKE - Vukile Property Fund - Expects trading improvement in 2011
Vukile Property Fund Limited
(Incorporated in the Republic of South Africa)
(Registration number 2002/027194/06)
ISIN : ZAE000056370
JSE Share Code : VKE
NSX Share Code : VKN
("Vukile" or "the company")
VUKILE EXPECTS TRADING IMPROVEMENT IN 2011
Johannesburg, 29 June 2010 - Vukile Property Fund Limited expects to see only a
slight improvement in its trading environment for the remainder of the 2010
year, despite signs of a recovery in the South African economy.
In its annual report published today, chairman Anton Botha noted that the
property sector lags the broader economy by between 12 and 18 months and that
the recently announced electricity price increases and higher municipal rates
would take its toll on the market by affecting rental affordability and
consequently exerting pressure on rental margins.
Longer-term, however, property fundamentals look positive with the supply of new
rentable space remaining restricted given high construction costs, electricity
supply constraints and limited available funding. "When demand for space
improves, it is likely to have a positive impact on vacancy and rental levels,"
said Botha.
Vukile produced a strong set of results for the year ended 31 March 2010,
increasing its distribution to linked unitholders by 10.2% and growing its net
asset value by 8.7%. These results were achieved on the back of limited
increases in vacancies, strong rental growth in some sectors and good control of
bad debts. Cost control continued as a priority throughout the financial year
and the company`s recurring cost to revenue ratio would have decreased again had
it not been for the effect of electricity tariffs and municipal rates increases.
During the year, in addition to in-sourcing the property asset management of its
own property portfolio, Vukile acquired Sanlam Properties` property asset
management business relating to the property asset management of Sanlam`s
property portfolio, including an option to acquire a R500 million property
portfolio as well as a right of refusal to the remainder of Sanlam`s properties.
It is also in the process of finalising the acquisition of nine properties from
Sanlam Life for a consideration of R531 million, which is still subject to
regulatory and other approvals.
"The successful acquisition of the property asset management business and the
high quality property portfolio to be acquired from Sanlam Life provide the
company with a solid platform for the next stage of its growth. So too does the
prospect of future acquisitions stemming from the option to acquire a R500
million property portfolio from Sanlam and the ongoing right of first refusal
over the remainder of Sanlam`s properties," said Botha.
For further information contact Gerhard van Zyl, CEO Vukile Property Fund
Limited,
on 011 288 1002
Issued by du Plessis Associates on behalf of Vukile Property Fund Limited.
dPA contact Helen McKane Tel : +27 11 728 4701,Fax: +27 11 728 2547, Mobile: 082
330 2034 or e-mail: vukile@dpapr.com
website: www.vukileprops.co.za
JSE Sponsor
Barnard Jacobs Mellet Corporate Finance (Pty) Limited
NSX Sponsor
IJG Securities (Pty) Limited
Date: 29/06/2010 11:31:02 Produced by the JSE SENS Department.
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