PROPERTY: Thar's Gold In Them Thar Hills
Recent Western Cape Business News
SO much for the property slump. JSE listed property company Sycom will be paying R165 million for the Tyger Hills Office Park in Cape Town’s northern suburbs.
The property was acquired from Louis Norval’s Attfund, which seems happy to take settlement in the form of Sycom paper (around 9 million linked units to be precise).
Attfund is an unlisted retail focussed property fund, which holds a property portfolio worth some R8 billion.
It has a meaningful Cape presence outside the Tyger Hills property – including the CapeGate Retail Precinct (valued at R1.4 billion), the Garden Route Mall (R726 million) and the Somerset Value Mart (R140 million).
The Tyger Hills property represented around 4% of Attfund’s rental stream.
On paper it seems that Attfund has struck a fair deal, having valued the Tyger Hills property at R149 million in its 2009 accounts.
Tenants at the Tyger Hills property – which has over 11 000 sq m of gross lettable area at a average rental of R128 per sq m - include Dimension Data, Siemens, Cell C and Pepkor. Demand for properties recently saw extensions to the tune of nearly R70 million – including a super basement.
The Tyger Hills property is expected to generate gross rentals of some R17.7 million in the year to end March 2011 with net rentals coming in just over R15 million.
In other words, Sycom will be looking at a fairly attractive rental yield of some 9% from the Tyger Hills property in the financial year ahead.
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