Wrap Text
Voluntary Announcement – Spear Proceeds With R74 Million Redevelopment Of Blackheath Park For Bravo Brands
SPEAR REIT LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2015/407237/06)
Share Code: SEA
ISIN: ZAE000228995
LEI: 378900F76170CCB33C50
Approved as a REIT by the JSE
(“Spear”)
VOLUNTARY ANNOUNCEMENT – SPEAR PROCEEDS WITH R74 MILLION
REDEVELOPMENT OF BLACKHEATH PARK FOR BRAVO BRANDS
Transactions within the Cape Town industrial property sector are certainly demonstrating that
the market is bouncing back. Bravo Brands, the South African home comfort group, has
entered a 10-year lease with Spear at Blackheath Park, in Cape Town. Spear will be
redeveloping approximately 50% of the 38 000 m2 industrial premises. Redevelopment works
commence on-site at Blackheath Park 1 November 2022 with the Bravo Brands lease
commencement and occupation of their new facility at Blackheath Park 1 February 2023.
Bravo Brands, synonymous with branded products such as Alpine, Gommagomma, Grafton
Everest, King Koil, La-Z-Boy, Sealy, Slumberland, Edblo and Nouwens, has chosen Cape
Town as the growth node for its export business, citing the Western Cape as the location with
the best growth prospects. According to Group Chief Executive Officer, Dave Govender, the
agreement is aligned to its core purpose of strengthening its local economic contribution to
enable its brands, stakeholders and communities to prosper – through local procurement and
production, and by spearheading industry transformation through skills development and
transfer.
As more local companies move their operations onshore and place less reliance on China, it
seems that the deglobalisation trend is gaining momentum as a sustainable supply-chain
solution. Speaking at Blackheath Park, Quintin Rossi, CEO of Western Cape-focused Spear,
says that the property market will be required to adapt to the demands of deglobalisation by
providing internationally matching facilities. These conversions will enable Bravo Brands to
bolster the production and distribution capacity of its lounge brands for both local and
international markets.
Having outgrown its current premises in Parow Industria, which is also owned by Spear, Bravo
Brands sought an internal solution through Spear, given the strong alignment between the two
groups. Demonstrating the advantages of a diversified property portfolio with its largest
sectoral exposure to industrial real estate and the agility to adapt, Spear responded with a
R74 million re-development plan of its Blackheath industrial property. Bravo Brands’ initial
take-up at Blackheath Park will be 16 000 m2 which will comprise of 13 000 m2 of the current
gross lettable area (“GLA”) together with newly constructed GLA of 3 000 m2, with further
intended expansion over the next five to seven years up to an aggregate GLA of 42 000 m2.
The initial redevelopment yield for Spear will be 9,85% on completion. Spear’s project team
will execute the redevelopment, to provide a turnkey facility for Bravo Brands. This includes a
solar installation that is earmarked for 2023 in line with Spear’s and Bravo Brands’
sustainability commitment.
Commenting on the agreement, Cliff Toerien, Chief Operations Officer for Spear said, “The
multi-year redevelopment lease concluded with Bravo Brands is an endorsement of the ability
of Spear’s portfolio to offer highly versatile solutions to a wide variety of blue-chip users in the
market.”
Blackheath’s proximity to Cape Town International Airport, access to public transport and
attractive commercial terms, supported by arterial upgrades and broader development activity
undertaken over the last five years are fast positioning it as a sought-after industrial hub.
Rossi says that although the upgrades are underpinned by Bravo Brands’ specified needs,
the redevelopment improves the operating metric of the property through the capital
enhancement. He went on to say that this also includes an improved tenant covenant and a
boost to the weighted average lease expiry (WALE) on the property. The redevelopment
further exhibits the desirable locations of Spear’s portfolio assets, their versatility for
redevelopment and the hands-on nature of our asset management approach to unlock
embedded portfolio net asset value for shareholders through portfolio enhancements and
value add projects.
Cape Town
24 August 2022
Sponsor
PSG Capital
Date: 24-08-2022 03:00:00
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