Real Estate Investor Magazine South Africa December/ January 2018/2019 | Page 48

LISTED
Making sense of REITs
S
outh African Real Estate Investment Trust (REIT) is a listed property investment vehicle that is similar to interna-
tionally recognized REIT structures from around the world. Listed Company REITs or Trust REITS are publicly traded
on the JSE.
Monthly we publish REIT company financial results, their property strategies and highlights of their future plans. It gives
the investor an insight to evaluate these companies for possible REIT investment opportunities, property education as
well as sharing valuable information on how these companies have invested and progressed.
INDLUPLACE
PROPERTIES
Delivers revenue growth
through portfolio
diversification
Indluplace
Properties
Limited
(“Indluplace”),
a JSE-listed REIT with
a portfolio that provides
affordable rental housing,
today released its financial
Carel de Wit, CEO
results for the year ended 30
September 2018. Indluplace reported a dividend of 49.19 cents
per share for the six months ended September, bringing the total
dividend for the year to 97.75 cents per share, in line with the
prior year.
Indluplace Properties is the only REIT listed on the main
board of the JSE that focuses exclusively on rental residential
property. Since its listing it has increased the value of its
properties to R4.3 billion and currently owns 176 residential
properties consisting of 9 788 residential units and about 18
163m2 retail space, spread mainly across Gauteng.
Indluplace is growing a diverse portfolio by focusing on
acquiring yield enhancing properties and portfolios that
provide income from date of acquisition. This will be achieved
by investing in rental housing, where a proven demand exists,
generally in larger urban centres close to work opportunities and
transport infrastructure.
Indluplace offers an exit for developers or owners of residential
stock or portfolios and utilises specialist outsourced property
managers for the appropriate portfolios.
During the reporting period, Indluplace bedded down its
R4.3 billion (2017: R2.9 billion) expanded property investment
portfolio following the acquisition of a R1.4 billion portfolio from
the Buffet Group. As a result of the transaction, the portfolio
now comprises 9 788 units across 176 properties that are spread
across provinces and unit categories, making Indluplace a well-
diversified and defensive property portfolio.
Highlights
• Full year dividend of 97.75 cents per share in line with
prior year
• Portfolio expanded to R4.3 billion
• Focus on portfolio optimisation opportunities to ensure
medium-term growth
• Strong balance sheet with LTV of 30%
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DECEMBER 2018/JANUARY 2019 SA Real Estate Investor Magazine
Commenting on the year’s results, CEO Carel de Wit, said:
“Notwithstanding a strenuous macroeconomic environment,
we have benefited from the acquisitions of the Diluculo and
Buffet portfolios in terms of revenue generation. Our expanded
portfolio provides diversity in terms of location as well as mix
of unit sizes and unit types that cater for the residential rental
segment, which is expected to continue growing in the long
term.”
Since listing in 2015, Indluplace has grown its portfolio by an
impressive 265% and has secured a significant presence in the
affordable end of the residential rental market. The transformative
acquisitions included in this year’s results resulted in a higher
loan-to-value ratio of 30.1% (2017: 6.8%) through R1.5 billion
in facilities secured from ABSA, Investec and Standard Bank.
STOR-AGE
Outperforms sector to
continue growth
Stor-Age is South Africa’s
only specialist self storage
REIT on the JSE. The
fast-growing self storage
sector is a niche sub-sector
of the broader commercial
property market. Stor-Age’s
portfolio is differentiated by
Gavin Lucas, CEO
its properties’ high visibility
to passing traffic, easy access
off busy arterial routes and proximity to middle to upper income
suburbs. 
Stor-Age made a strategic entry into the UK self storage
market in November 2017 and now owns the 6th largest UK self
storage brand – Storage King. 
The portfolio across South Africa and the United Kingdom
comprises 73 properties (63 trading and 10 new developments),
covering a GLA of c.414 000 m². The portfolio is concentrated
in the four major South African cities - Johannesburg, Cape
Town, Pretoria and Durban (49 properties), with the United
Kingdom portfolio having a bias towards the East and South-
East of England (14 properties). 
 In addition to the 63 properties trading under the Stor-Age
and Storage King brands, a further 12 properties trade under
licence of the Storage King brand in the UK, bringing the total
number of properties trading under the Storage King brand to