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Investec Property Fund increases stake in a group of European logistics properties

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Investec Property increases stake in a group of European logistics properties in a multi-billion rand transaction

Investec Property Fund is increasing its stake in a group of European logistics properties in a multi-billion rand transaction.

Recently, the property fund announced that it will sell its stakes in the Musina Mall in Limpopo and the Boitekong Mall in Rustenburg, for R727m – which it wanted to invest in Europe.

The new transaction will see Investec Property Fund increase its holding in the Pan European Logistics (PEL) platform from 42.9% to 75%. The property fund will introduce a new strategic equity partner for the remaining 25% of the platform as part of a €277 million (R4.5 billion) deal.

PEL owns 45 logistics properties, spanning 1 million square meters across six European countries, and the deal values the group at R15 billion.

Investec is buying the stake from the property group Ares. The proposed transaction is expected to be closed on 14 February 2020.

The proposed acquisition aligns with IPF’s stated intent to navigate the South African portfolio through the current domestic economic slowdown, while deploying capital into its offshore portfolios that are capturing growth stemming from positive underlying property fundamentals, Investec Property Fund said in a statement.

The transaction is set to take IPF’s offshore exposure to just below 30%.

Darryl Mayers, joint CEO of Investec Property Fund said: “Despite this recent growth, the European logistics market remains less advanced than that of the UK, Asia and USA but is expected to grow strongly at an average in excess of 11% per annum for the next five years.”

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