RDC Properties continues to diversify its portfolio with the latest being a R170.9 million acquisition of a South African Western Cape-based loan stock company, Capitalgro.
According to the group’s executive chairperson, Guido Giachetti, following a stringent due diligence process the company invested R50.9 million, securing a 34.85% controlling stake in the issued share capital of Capitalgro.
RDC Properties invested an additional R120 million into Capitalgro giving RDC Properties a 63% stake in the company. This additional investment enabled Capitalgro’s acquisition of the AAA rated, five-star certified commercial building known as ‘The Edge’.
“As a consequence of our investment in Capitalgro’s, we were offered the opportunity to secure a footstep in the United States of America (USA) market,” he said.
Giachetti further highlighted that accordingly, RDC invested $3 million in the acquisition of a development company in Nashville, Tennessee in USA.
“The strategic intent of this investment is to grow a small portfolio in an exciting area of the USA and to create relatively small but important currency hedge to the pula,” he said.
The CEO also noted that they have managed to form some relationship and partnered with Crossgate Partners, a real estate investment and development firm who are now assisting RDC in identifying and investing opportunities in the
Currently the group has 22 properties in Botswana, four in South Africa, three selected sites in Namibia, two building sites in Mozambique and one development site each in the USA and Madagascar.
“Our investment and property portfolio has gone up to 31% recording P1.6 million compared to the P1.2 million that was recorded last year on the corresponding period,” he said.
He shared the group’s objective of focusing on accumulating and developing a quality portfolio of unique properties with potential for rental and capital growth and with a regional focus and diversified income stream.
Their four main areas are in strategy and selectively acquiring and developing a portfolio uniquely regional in Namibia, Botswana, Mozambique, Madagascar and South Africa.
The group has projected Botswana to contribute 64.6% to their next financial year’s revenue with South Africa contributing 33.9% and Mozambique with 1.5 percent.
“In 2018, we will benefit from existing yielding properties in the Western Cape region and we expect to start receiving revenue from our development projects in Mozambique and the USA followed later on by the Namibian projects,” he said.