Growthpoint Properties is preparing the largest commercial property securitization in South Africa to date following its acquisition of Metboard Properties. Expected to come to market in August, the deal is expected to be ZAR1 billion ($136.7 million) topping Growthpoint’s own ZAR969 million ($132.5 million) CMBS completed this month.
Growthpoint has already signalled ZAR 5 billion ($683 million) program launched (SN, 12/2).
Growthpoint had owned 17% of Metboard, and has acquired 100% of the shares in the firm, which is focused on light industrial properties such as warehousing and distribution concerns. Stuart Snowball, cfo at Growthpoint in Sandton, South Africa, said the acquisition has been approved and will be effected June 30. Metboard has existing loans which Growthpoint plans to pay-off and refinance by issuing notes backed by the Metboard properties. The properties will remain in Metboard and all other liabilities will be settled be Growthpoint. He said this will ‘clean’ the company, and it will act as a ring-fenced vehicle which will get better tranching from the rating agencies than if they were held in the operating company--in this case Growthpoint--and were exposed to its risks.
Investec is acting as arranger, liquidity provider, property manager and recovery agent. Snowball said both Growthpoint and Metboard have a long relationship with Investec.