The group will retain the remaining 20% interest in the portfolio and have a working relationship with Dipula.
Medium to large South African listed property funds have been acquiring property portfolios from unlisted groups.
They have found few listed companies that are obvious takeover targets. In an environment in which interest rates are expected to rise soon and the cost of borrowing to climb, some listed funds believe they need to acquire ready-built properties now instead of building new properties from scratch using borrowed funds.
The portfolio acquired consists of 28 properties with low vacancy levels of about 2.5% of gross lettable area. Many of its tenants are large South African companies spread across varied industries and they include Pepkor, Nedbank, Absa, Truworths, Shoprite, Game, Boxer and The Foschini Group.
The largest investment is a R112.9m, 50% stake in Seshego Circle in Polokwane, a 15,166m² mall that opened in 2013, anchored by Shoprite and Cambridge Food. The portfolio includes a 10,400m² value centre in Soweto anchored by Builders Warehouse.
The Moolman Group would continue to manage the property portfolio for a minimum of three years as part of the transaction. It also provided rental guarantees for between one and two years across the portfolio.
CEO Izak Petersen said most of the assets complemented the Dipula portfolio but there might be some rebalancing through sales to optimise its portfolio.
"The portfolio has excellent occupancy levels and is yieldenhancing for investors.
"Moolman Group is a respected industry player with assets and expertise focused on the same market segment as Dipula. We believe this new joint venture relationship may be a source of further opportunities for both parties.
"The transaction increases the geographic diversity of our portfolio, especially in Limpopo and the North West where we are currently underweight."
He said Dipula would continue to look for acquisition opportunities to add momentum to its fund. He was also looking offshore but had not yet found any suitable opportunities.
"We recognise that many South African funds are searching abroad in lower interest rate and lower cost of debt environments. We have not yet found anything we think would work for us. Currently we want to manage Dipula as a diversified fund with strong assets that will be focused in SA," he said.
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