The country’s largest asset manager, Bifm, plans to ramp up its Local Property Fund to a size of P2.04 billion by 2025, from the current P1.3 billion, through targetted investments in the market.
Giving an update on the Fund recently at Bifm’s annual seminar, Botlhe Tshukudu, Bifm’s Portfolio Manager for Unlisted Investments, said investments had slowed down during the COVID-19 era due to significant risks in the market such as depressed rental yields and uncertain cash flows.
He however said with impending changes to the pension fund rules expected to create high liquidity in the local market, there was an opportunity for the Fund to tap into this and secure opportunities. Under changes to the Retirement Funds Act, local pension funds will soon be required to invest a minimum of 50% domestically, from the current 30%, although the changes will be done in a phased manner over several years.
Tshukudu said the Fund was currently invested in Airport Junction through a special purpose vehicle with other investors, as well as in Engen Palapye, Engen Maun and others.
He said the intention was to continue similar partnerships in the property market.
Opportunities are particularly bright in the retail market, he said, where the Fund is targeting a 51% allocation from the current 48%, while the office space market is seen as more risky.
Property analysts have said the office space market is approaching saturation in areas such as Gaborone, while opportunities exist in the industrial and hospitality market around the country.
