Grit sells 17.35 per cent interest in Acacia Estate in Mozambique
Grit Real Estate Income Group Limited, a pan-African income real estate company, is to reduce its interest in Acacia Estate (Acacia), a 76 residential units condominium property located in Maputo, Mozambique, from 80 per cent to a combined direct and indirect interest of 62.65 per cent, at an implied property valuation of USD67,540,000.
While remaining a core asset, the Board believe that Acacia has reached an attractive valuation yield of 7.93 per cent at 30 June 2020, representing a 9.4 per cent increase on the August 2018 acquisition value. Grit will continue to asset manage the structure and shall continue providing full property management activities.
Upon completion, Grit Services Limited (GSL) will realise USD11,812,908 in cash from the part disposal of its share in the Property which will be used to replenish its working capital reserves in the short term and for redeployment into Grit’s yield accretive pipeline over the medium term.
Bronwyn Corbett, CEO of Grit Real Estate Income Group Limited, says: “We continue to execute on Grit’s strategy of owning and managing high quality real estate assets let to high quality tenants across the African continent that deliver strong and sustainable income for shareholders, with the potential for income and capital growth. This transaction demonstrates the Group’s ability to deliver value from its assets, as since 2018 we increased Acacia’s net operating income from USD5.1 million to USD5.4 million and its valuation yield shifted from 8.25 per cent to 7.93 per cent. The Property remains core to the Group and with our remaining majority ownership, Grit remains committed to effectively servicing our tenants in their properties and property management needs.”