Vunani Property dissatisfied with growth results

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“If you go through our results, we actually only grew 84 million, which is quite modest really. If you look at all of our other indicators and all the other guidance – we either met or exceeded all of the guidance that we’ve given into the sector,” Rob Kane, the CEO of Vunani Property Investment Fund, told CNBC Africa on Monday.

“Our distribution growth was up 19.8 per cent, our share price growth 21.7 per cent so those are good figures and yet we didn’t grow and the sector’s saying well why not? The reason is very simple – we just could not buy value.” 

[DATA VPF:Vunani Property]’s full year market value growth was up 21.8 per cent to 1005 cents and its total compounded growth was up 31.2 per cent. Its distribution growth increased to 77.25 cents.

The fund admitted that it had experienced its toughest trading conditions in eight years and warned that the property market remained tough.

“We almost doubled it last year. We were a bit more conservative in the last 12 months primarily because we find it really difficult to acquire properties of value – there’s a lot of property on the market but a lot of it was overpriced,” said Kane.   

Following its recent conversion to a real estate investment trust (REIT), Vunani Property managed to obtain shareholder approval to raise 455 million rand via a rights offer.

Kane insisted that Vunani Property has been looking quite actively in the market as a result of the approval, and the fund is beginning to see value.

“If you look at our strategy now, it’s exactly the strategy we had when we listed – we needed to raise about 360 million in order to list, we raised 622. That gave us fire power to make good acquisitions,” he said.

“Post the capital-raise, if we get the full 455, we can then go out and acquire about 750 million rand worth of property and that’s what kicks up our distribution.”