JSE listed Trematon Capital Investments Limited, the Western Cape-focused actively managed Investment Holdings Company, through its subsidiary ARIA Property Group, today announced a R614 million acquisition from Redefine Properties Limited. The acquisition comprises seven key office, retail, industrial and mixed use assets located in strategic, high-potential nodes predominantly across the Western Cape province.
The acquisition will expand ARIA’s commercial property portfolio to 21 assets and will add an additional 90 000 m2 of gross lettable area (GLA) to the portfolio. Tenants include blue chip national operators such as Standard Bank, Bidvest, Engen, Foschini, Clicks, Virgin Active, Shoprite, Truworths, Capitec, KFC, Beares and Ackermans.
Trematon Chief Executive, Arnold Shapiro commented:
“This transaction marks a significant step-change to Trematon’s growth trajectory and fits squarely into the ARIA strategy of acquiring key assets that are undervalued and allow for significant value unlock by our team. We see significant upside potential for income and capital growth across the portfolio.”
Since the acquisition will be debt funded, the effect on income will initially be dilutive but management expects that rental income will increasingly contribute to the Company’s profit as the portfolio is redeveloped and retenanted.
Apart from its commercial real estate interests held through ARIA, Trematon is also invested in residential real estate through the wholly-owned Resi Investment Group, as well as the gaming and leisure sector through its wholly-owned interest in the iconic Club Mykonos Resort in Langebaan, and its 30% interest in the Mykonos Casino. Other investments include Generation Education, an education business which, in time, is expected to become the fifth major area of operation.
“Trematon allows investors the chance to access high-growth opportunities alongside management that would generally be inaccessible to equity market investors. Our competitive advantage is our flexibility to seek out and opportunistically acquire high-potential but undervalued opportunities across industry, based on a strong balance sheet and deep business networks within the Western Cape region.”
Shapiro pointed to the Company’s proven track record in this regard; upgrading Club Mykonos to a premier tourist destination, development of Boulevard Park outside the Cape Town CBD into a prestigious blue-chip office park, and turning around several distressed partially-complete residential units in the Western Cape. The total Resi portfolio, including new builds amounts over 600 units.
ARIA, under the management of Ilan Kaplan and Justin Roome, has similar experience in unlocking quality property assets. ARIA’s redeveloped Northgate Island from a failed and vacant shopping mall into arguably one of Cape Town’s landmark sites set on the corner of the N1 Highway and Koeberg Road in Milnerton, in the Northern Suburbs of Cape Town.
“Northgate was a failed big box retail development in a vacant and troubled state when we bought 85% of the 18 000m2 property in 2014. We successfully redeveloped and repurposed it as an A Grade office park, drawing on international best practice as far as incorporation of natural light and greenery is concerned. The park is now fully let and a very desirable asset. “Nationals who have been attracted to Northgate include Moore Stephens, Weylandts, Vida e head office, WiGroup and DVT,” he concluded.