Mauritius- and Johannesburg-listed Grit Real Estate Income Group on Thursday declared a distribution a share of $0.12 for the year ended June 30, a 2.7% increase on the prior year on the back of strong financial results.
The seventh consecutive dividend comprised an interim dividend of $0.06 apiece, a clean-out dividend for the four months to April 30 of $0.05 a share and a final dividend for the two months to June 30 of $0.01 a share.
Distributable income increased by 42.3% from $10.63-million last year to $15.13-million in 2017.
During the 12 months to June 30, Grit increased its rental income, including from associates, by 14% on the back of rental escalations, the full-year impact of properties acquired in 2016 and income from Mall de Tete, in Mozambique, and the Lux Tamassa resort, in Mauritius, that transferred in March.
The group noted that vacancies remained stable at 3% across the portfolio, attributed to strategic vacancies at Anfa Place Shopping Centre, in Morocco, in line with the upgrade of the centre that is expected to be completed in the fourth quarter of 2018.
The consequent reduced rentals at Anfa Place adversely impacted on rental income by $1-million against the 2016 financial year.
“Our business model is based on structured investments underpinned by property assets. Debt is a major lever in this equation and the team successfully reduced our average weighted cost of capital from 6.22% in 2016 to 5.78% for 2017, despite the 0.48% increase in the US dollar three-month London Interbank Offered Rate,” said Grit CEO Bronwyn Corbett.
The weighted average lease expiry on Grit’s existing portfolio increased from 5.8 years in 2016 to 6.4 years in 2017, as a result of successful lease renewals.
Following the transfer of the Imperial Warehouse, in Kenya, and interest in Beachcomber Hospitality Investments, in Mauritius, in August, this would increase to a healthy 7.8 years, the company concluded.