Wrap Text
Reviewed condensed consolidated interim results for the six months ended 30 September 2016
Investec Australia
Property Fund
2016
REVIEWED CONDENSED
CONSOLIDATED
INTERIM RESULTS
for the six months ended
30 September 2016
Highlights
Interim distribution
4.81 cpu pre WHT
Growth of 6%
6% - 8%
Full year growth
guidance
maintained
AUD89.3mn*
DEPLOYED in H1
in a competitive market
2.1%
NAV PER UNIT GROWTH
driven by revaluation uplift
5.5 years*
Long WALE
56% of leases expiring
after five years
98.1%*
OCCUPANCY rate
leasing activity unlocking value
AUD601.2mn*
GROWTH THROUGH
ACQUISITIONS AND
VALUATION UPLIFT
3.53% all in funding rate^
Historically low
funding rates
75% hedged for 8.2 years
* Includes acquisition of 324 Queen Street, Brisbane post balance sheet date for AUD 66.0mn
which is due to settle on 1 December 2016.
^ Includes AUD 55.0mn forward starting swap commencing on 1 December 2016.
All amounts are in Australian dollars unless otherwise stated.
Condensed consolidated statement of profit or loss and other comprehensive income
For the six months ended 30 September 2016
Reviewed Reviewed
6 months to 6 months to Audited
30 September 30 September 31 March
AUD'000 2016 2015 2016
Revenue, excluding straight-line rental revenue adjustment 23 972 17 209 37 663
Straight-line rental revenue adjustment 1 429 966 1 630
Revenue 25 401 18 175 39 293
Property expenses (3 783) (2 435) (5 185)
Net property income 21 618 15 740 34 108
Fair value adjustments - investment property 10 015 (3 392) 20 488
Other operating expenses (1 830) (1 637) (4 663)
Operating profit 29 803 10 711 49 933
Finance costs (8 817) (2 007) (6 908)
Finance income 44 31 79
Profit on sale of investment property - - 116
Other income - 6 264
Total profit and other comprehensive income for the period 21 030 8 741 43 484
Cents
Basic and diluted earnings per unit 6.61 3.54 17.09
Basic and diluted headline earnings per unit 3.46 4.92 8.99
Condensed consolidated statement of financial position
As at 30 September 2016
Reviewed Audited
as at as at
30 September 31 March
AUD'000 2016 2016
Assets
Non-current assets 535 205 493 850
Investment property 535 205 493 850
Current assets 5 343 3 073
Cash and cash equivalents 3 847 1 108
Trade and other receivables 1 496 1 965
Total assets 540 548 496 923
Equity and liabilities
Unitholders' interest 350 017 332 487
Contributed equity 321 945 310 136
Retained earnings 28 072 22 351
Total unitholders' interest 350 017 332 487
Non-current liabilities 170 228 143 098
Long-term borrowings 163 077 141 671
Trade and other payables 477 477
Financial instruments held at fair value 6 674 950
Current liabilities 20 303 21 338
Trade and other payables 4 845 6 870
Distributions payable 15 458 14 468
Total equity and liabilities 540 548 496 923
Units in issue 322 359 312 541
Net asset value per unit (cents) 108.58 106.38
Condensed consolidated statement of cash flows
For the six months ended 30 September 2016
Reviewed Reviewed
6 months to 6 months to Audited year
30 September 30 September ended 31 March
AUD'000 2016 2015 2016
Cash flows from operating activities
Cash generated from operations 16 827 15 133 29 260
Finance income received 44 31 344
Finance costs paid (3 116) (1 927) (4 975)
Distributions paid to unitholders (14 321) (10 226) (19 100)
Net cash flow from operating activities (566) 3 011 5 529
Net cash flow used in investing activities (29 911) (41 794) (129 443)
Net cash flow from financing activities 33 216 42 483 122 661
Net increase/(decrease) in cash and cash equivalents 2 739 3 700 (1 253)
Cash and cash equivalents at the beginning of the period 1 108 2 361 2 361
Cash and cash equivalents at the end of the period 3 847 6 061 1 108
Condensed consolidated statement of changes in equity
For the six months ended 30 September 2016
Reviewed Reviewed
6 months to 6 months to Audited year
30 September 30 September ended 31 March
AUD'000 2016 2015 2016
At the beginning of the period 332 487 248 704 248 704
Profit for the period 21 030 8 741 43 484
Total comprehensive income 21 030 8 741 43 484
Transactions with unitholders in their capacity
as unitholders:
Issue of ordinary units 12 010 - 65 960
Distributions paid/payable to unitholders (15 510) (11 193) (25 661)
Balance at the end of the period 350 017 246 253 332 487
Condensed segmental information
For the six months ended 30 September 2016
AUD'000 Office Industrial Total
Condensed statement of profit or loss and other
comprehensive income
Revenue, excluding straight-line rental revenue adjustment 16 796 7 176 23 972
Straight-line rental revenue adjustment 936 493 1 429
Property expenses (2 952) (831) (3 783)
Segment results 14 780 6 838 21 618
Acquisition cost and straight-line rental revenue adjustment (7 584) (451) (8 035)
Net investment property revaluation 14 900 3 150 18 050
Total segment results 22 096 9 537 31 633
Other operating expenses (1 830)
Net finance costs (8 773)
Profit for the period 21 030
AUD'000 Office Industrial Total
Condensed statement of financial position extracts at
30 September 2016
Investment property opening balance 336 250 157 600 493 850
Net additions, acquisitions and disposals 24 637 - 24 637
Capital expenditure 5 266 9 5 275
Straight-line rental revenue receivable 936 492 1 428
Fair value adjustments 7 316 2 699 10 015
Investment property at 30 September 2016 374 405 160 800 535 205
Other assets not managed on a segmental basis 5 343
Total assets at 30 September 2016 540 548
AUD'000 Office Industrial Total
For the six months to 30 September 2015
Condensed statement of profit or loss and other
comprehensive income
Revenue, excluding straight-line rental revenue adjustment 11 872 5 337 17 209
Straight-line rental revenue adjustment 539 427 966
Property expenses (1 771) (664) (2 435)
Segment results 10 640 5 100 15 740
Acquisition cost and straight-line rental revenue adjustment (691) (2 701) (3 392)
Net investment property revaluation - - -
Total segment results 9 949 2 399 12 348
Other operating expenses (1 637)
Net finance costs (1 976)
Other income 6
Profit for the period 8 741
AUD'000 Office Industrial Total
Condensed statement of financial position extracts at
30 September 2015
Investment property opening balance 247 000 95 130 342 130
Net additions, acquisitions and disposals 2 152 39 594 41 746
Straight-line rental revenue receivable 539 427 966
Fair value adjustments (691) (2 701) (3 392)
Investment property at 30 September 2015 249 000 132 450 381 450
Other assets not managed on a segmental basis 7 868
Total assets at 30 September 2015 389 318
Notes to the reviewed preliminary condensed consolidated financial results
For the six months ended 30 September 2016
Reviewed Reviewed
6 months to 6 months to Audited year
30 September 30 September ended 31 March
AUD'000 2016 2015 2016
1. Distribution reconciliation
Profit and total comprehensive income for the period 21 030 8 741 43 484
Less: Straight-line rental revenue adjustment (1 429) (966) (1 630)
Add back: Fair value adjustments - investment property (10 015) 3 392 (20 488)
Add back: Fair value adjustments - derivatives 5 725 26 1 975
Antecedent distribution 199 - 2 320
Distribution pre withholding tax 15 510 11 193 25 661
Withholding tax to be paid/payable to the Australian
Taxation Office (547) (661) (609)
Final distribution post withholding tax 14 963 10 532 25 052
Number of units
Units in issue at the end of the period 322 359 246 581 312 541
Weighted average number of units in issue for the period 318 121 246 581 254 437
Cents
Distribution per unit (pre withholding tax) 4.81 4.54 9.17
Distribution per unit (post withholding tax) 4.64 4.27 8.92
2. Headline earnings reconciliation
Profit and total comprehensive income for the period 21 030 8 741 43 484
Add back: Fair value adjustments - investment property (10 015) 3 392 (20 488)
Add back: Profit on sale of investment property - - (116)
Headline earnings 11 015 12 133 22 880
Basic and diluted earnings per unit 6.61 3.54 17.09
Basic and diluted headline earnings per unit 3.46 4.92 8.99
3. Financial instruments
Financial instruments held at fair value consist of interest rate swaps, which are classified as level 2 in the fair value
hierarchy. These are valued using valuation models which use market observable inputs such as quoted interest rates.
No other financial instruments are carried at fair value. Non-current long-term borrowings held at fair value amount to
AUD 163.1mn.
Commentary
Introduction
Investec Australia Property Fund ("Fund") is the first inward-listed Australian REIT on the JSE Limited ("JSE"). It is an income-
producing fund that operates in a stable and developed market. As at the date of this announcement the Fund comprises
21 properties with a total gross lettable area of 195 407m�* and a portfolio value of AUD 601.2mn*.
The Fund aims to maximise sustainable returns to unitholders by investing in quality office, industrial and retail properties in
Australia, giving unitholders exposure to the Australian real estate market and the Australian dollar.
Market commentary
Australia's economy has proven to be resilient with economic growth trending above the long term average. Australian GDP
grew by 3.3% over the 2015/16 financial year which is the fastest rate of growth in the last four years and Australia has now
celebrated 25 years of positive economic growth. The official cash rate remains on hold at 1.5% with the RBA noting that the
global economy is growing at a below average pace. Inflation remains below the target range of 2-3% with subdued wage
growth, falling energy and fuel costs and food deflation resulting in weak CPI data. The decline in the mining sector has been
offset by growth in other areas with positive white collar employment figures showing positive trends although there is a strong
variation between the States.
The economy has created in 163 000 jobs in the year to September 2016. In line with the recent bounce in commodity prices
the AUD rebounded in September gaining 1.54% to close at USD 0.763 along with the expectation that the RBA will hold rates
for the foreseeable future.
In the commercial real estate market there was limited stock on the market in the first half of the year. There has however been
a strong increase in investment activity in Q3 with commercial transactions in Australia at a similar level to last years' volume at
over $20bn. The increased volume in Q3 was dominated by foreign capital which accounted for 55% of the total investment.
Capital flows from China and Singapore accounted for over 60% of the foreign capital. There continue to be new sources of
capital emerging for assets across the eastern seaboard. The tight availability of investment stock in the CBD's has pushed
investors to look at alternative locations in the metropolitan areas. The strong foreign investor demand has seen an accelerating
cap rate compression in the eastern states.
Financial results
The board of directors of Investec Property Limited ("IPL"), the Responsible Entity of the Fund, is pleased to announce an
interim distribution of 4.81 cents per unit pre withholding tax ("WHT") and 4.64 cents per unit post WHT for the six months to
30 September 2016 (30 September 2015: 4.54 cents per unit pre WHT and 4.27 cpu post WHT). This represents growth of
6.0% pre WHT and 8.7% post WHT for the half year achieved as a result of the accretive acquisitions made during the period,
fixed rental escalations built into leases, and successful letting of vacant space acquired at properties such as 266 King Street,
Newcastle. Guidance for the full year is maintained in the range of 6.0% to 8.0% pre WHT.
The continued performance of the Fund translates into a total return of 85.2%** since listing which supports the case for
investing in good quality real estate in a developed market where returns are derived in a hard currency.
* Includes acquisition of 324 Queen Street, Brisbane post balance sheet date for AUD 66.0mn which is due to settle on 1 December 2016.
** Post WHT based on a spot rate of 10.4150 for the HY distribution and a unit price at 30 September of 14.96.
The financial result is the outcome of the Fund's successful implementation of the strategy outlined at listing, subsequently
adjusted to take account of market considerations, namely:
- achieving capital growth through active property management and valuation uplift (see the section below entitled "Properties");
- diversifying the Fund's asset base (see the section below entitled "Asset diversification");
- active capital and risk management, including diversification of the Fund's debt funding sources (see the section below entitled
"Capital and risk management"); and
- maximising property performance and capital value through active asset management and leasing (see the section below entitled
"Leasing activity").
Properties
Strategy
The Fund's strategy since listing has been to acquire quality properties that are well located with long lease expiries, limited
or no short term capital expenditure, contracted rental growth and sustainable income supported by good quality tenant
covenants. This strategy has resulted in the Fund acquiring a stable base portfolio which has delivered sustained distribution
growth coupled with valuation uplift.
However, the investment market in Australia remains competitive with a significant amount of domestic and offshore capital
chasing a limited number of investment opportunities. As a result of this, the Fund has previously indicated that it is willing
to acquire properties with manageable risk, such as vacancy and/or capital expenditure requirements. The Fund has been
able to implement this strategy with immediate success. For example, 21-23 Solent Circuit, Baulkham Hills was acquired in
March 2015 on an initial passing yield of 7.77% with 15% vacancy. The Fund has subsequently leased the vacant space and
the property is now yielding 9.98%. Similarly, 266 King Street, Newcastle was acquired in February 2016 on an initial passing
yield of 8.21% with 26% vacancy and a capital works program to be completed. The capital works program has now been
completed, the property is virtually fully let and the property is now yielding 9.18%.
The Fund's most recent acquisitions of 113 Wicks Road, Macquarie Park and 324 Queen Street, Brisbane are a continuation of
this strategy. 113 Wicks Road, Macquarie Park is a quality property delivering a 7.0% initial yield with a potential for a re-zoning
to mixed use which will result in a higher and better use and a corresponding valuation uplift. 324 Queen Street, Brisbane
has 20% vacancy and the Fund has identified a number of opportunities to enhance yield and add value through active
asset management. These include leasing up the vacant space, enhancing the building entrance and retail offering, reducing
outgoings and monetising signage rights.
Acquisitions
Property Effective Value GLA Yield WALE
name Geography date Sector (AUD'000) (m2) (%) (years)
113 Wicks Road, Macquarie Park Sydney, NSW 1/07/2016 Office 23 255 6 195 7.0 4.2
324 Queen Street, Brisbane Brisbane, QLD 1/12/2016 Office 66 000 19 611 7.2 3.2
Valuation
The Fund's policy is to perform independent external valuations on a rotational basis to ensure each property is valued at least
every two years by an independent external valuer (in compliance with the Fund's debt facilities). At other times where directors'
valuations are performed, the valuation methods include using the discounted cash flow model and the capitalisation model.
During the period, independent external valuations were carried out on five properties, resulting in valuation uplift in respect of
those properties of 7.7%. For all other properties, advice letters were obtained from independent external valuers to support
directors' valuations. In aggregate, revaluations contributed AUD 18.1mn to the increase in the value of the portfolio.
A fair value adjustment has been recorded in respect of the properties acquired during the period. This represents the write-off
of the transaction costs associated with the acquisitions, which primarily comprise stamp duty.
Asset diversification
Geographic spread
During the period, the Fund acquired 113 Wicks Road, Macquarie Park thereby increasing the Fund's exposure to New South
Wales which continues to be Australia's largest and best performing economy. Post the balance sheet date, the Fund acquired
324 Queen Street, Brisbane. Whilst the Queensland economy has felt the effects of a slow down in the resources sector, which
in turn has impacted the commercial property market, there are positive signs beginning to emerge in that market such as
positive net absorption, decreasing vacancy and an increase in effective rents.
Geographic spread by GLA (%)* Geographic spread by revenue (%)*
ACT 15% ACT 12%
NSW 34% NSW 31%
QLD 24% QLD 33%
SA 3% SA 2%
WA 11% WA 4%
VIC 13% VIC 18%
Sectoral spread
The acquisition of 324 Queen Street, Brisbane has resulted in the Fund's exposure to the office sector increasing. However,
given the strong performance of industries such as financial services, technology, education, tourism and administrative
services and the corresponding growth in white collar employment, this rebalancing of the portfolio is seen as positive.
Sectoral spread by GLA (%)* Sectoral spread by revenue (%)*
Office 45% Office 73%
Industrial 55% Industrial 27%
Capital and risk management
The Fund's gearing ratio will be 38.9%* as a result of the acquisition of 324 Queen Street, Brisbane. The Fund's average
gearing during the period was 30.4% (30 September 2016: 30.5%). The Fund's long-term strategy is to maintain a gearing
ratio of between 35% and 40%, however, the Fund will manage gearing levels to take advantage of attractive acquisition
opportunities. The weighted average maturity date of the Fund's debt is 4.1 years and the Fund has fixed 75%** of its interest
rate exposure for a weighted average term of 8.2** years at a rate of 3.72%. As at the date of this announcement the floating
rate on the balance of the Fund's borrowings is 2.97%. The Fund's all in cost of funding is currently 3.53%**.
During the period, the Fund added Australia and New Zealand Banking Group Limited ("ANZ") to the bank funding syndicate.
ANZ has funded (or agreed to fund) the acquisition of both 113 Wicks Road, Macquarie Park and 324 Queen Street, Brisbane.
Post the acquisition of 324 Queen Street, Brisbane ANZ will have funded 35.1% of the Fund's long term borrowing and
Westpac Banking Corporation ("WBC") will have funded 64.9%. The Fund has already seen the benefit of this diversification
through pricing tension.
During the period, the Fund diversified its swap book, adding exposure to Investec Bank plc. Investec Bank plc holds 65.1%**
of the swap book with WBC holding 34.9%. Again, this has provided immediate benefits to the Fund in terms of pricing tension.
* Includes acquisition of 324 Queen Street, Brisbane post balance sheet date for AUD 66.0mn which is due to settle on 1 December 2016.
** Incudes AUD 55.0mn forward starting swap commencing 1 December 2016.
Leasing activity
The portfolio will be 98.1%* occupied post the acquisition of 324 Queen Street, Brisbane. Excluding 324 Queen Street,
Brisbane the portfolio is 100% occupied. The Fund's lease expiry profile remains strong with a weighted average lease expiry
of 5.5 years by income and 56% of leases expiring after five years*. The Fund therefore continues to provide investors with
long term sustainable income.
Replacement leases/renewals
Weighted Weighted Weighted Weighted Weighted
average average average average average
GLA new rental reversion WALE escalation incentive
Office 1,645 $599 (2.0%) 6.0 3.00% 19.4%
Industrial 7,079 $114 2.0% 5.0 4.00% 0.0%
Letting of acquired vacancy
Weighted Weighted Weighted Weighted Weighted
average average average average average
GLA new rental reversion WALE escalation incentive
Office 3,484 $368 0.6% 5.1 3.27% 29.3%
Total 12,208 1.1% 5.2 3.66% 11.0%
Notes:
1. Replacement leases relate to the replacement of vendor leases at 757 Ann Street, Fortitude Valley.
2. Renewals relate to the exercise of an option by the tenant at 57 Sawmill Circuit, Hume.
3. Letting of acquired vacancy relates to new leases at 266 King Street, Newcastle.
Whilst each market and sector is different, indications are that the market generally is turning in favour of landlords with many
markets and sectors recording a decrease in vacancy rates and incentives and the supply and demand equation looking
much more balanced.
During the period, the Fund successfully completed the following leasing transactions:
Australian REIT structure
The Fund allows for the tax efficient flow-through of net income to unitholders. The Fund is an uncapped and open-ended
fund and existing and future unitholders will hold a participatory interest in the Fund, which entitles unitholders to a pro rata
share of the underlying income generated by the Fund and a pro rata beneficial interest in the assets of the Fund. The Fund is
registered as a Managed Investment Scheme in Australia. The Fund is governed and operated by IPL as Responsible Entity,
and is managed by Investec Property Management Pty Limited.
Unitholders
At 30 September 2016, Investec Property Fund Limited and Investec Bank Limited are the only unitholders holding in excess
of 5% of the Fund's total issued units, holding 12.40% and 16.63% respectively.
Number of units in issue 322 359 497
Number of unitholders 4 328
Changes to the board
There have been no changes to the board of IPL during the period.
Prospects
The H1 2017 result reflects the performance of the Fund's underlying portfolio and the successful implementation of the value
add strategy. The Fund is well positioned to deliver long term sustainable income and capital growth to investors through the
acquisition and efficient management of quality properties and the conservative capital and risk management.
Distribution growth guidance for the full year is maintained at 6% to 8% as previously indicated provided there are no material
changes to the underlying portfolio or other events that could impact growth.
The information and opinions contained above are recorded and expressed in good faith and are based upon sources believed
to be reliable. No representation, warranty, undertaking or guarantee of whatever nature is made or given concerning the
accuracy and/or completeness of such information and/or the correctness of such opinions.
Any reference to future financial information included in this announcement has not been reviewed or reported on by the Fund's
independent auditors.
On behalf of the board of Investec Property Limited as Responsible Entity for Investec Australia Property Fund.
Richard Longes Graeme Katz
Chairman Chief Executive Officer
16 November 2016
Basis of accounting
The condensed consolidated interim financial statements are prepared in accordance with International Financial Reporting
Standard, (IAS) 34 Interim Financial Reporting, the SAICA Financial Reporting Guides as issued by the Accounting Practices
Committee and Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council.
The accounting policies applied in the preparation of these condensed consolidated interim financial statements are in terms of
International Financial Reporting Standards and are consistent with those applied in the previous annual financial statements.
Review conclusion
These interim condensed consolidated financial results for the period ended 30 September 2016 have been reviewed by
KPMG Inc, who expressed an unmodified review conclusion. A copy of the auditor's review report is available for inspection
at IPL's registered office.
The auditor's report does not necessarily report on all of the information contained in these financial results. Unitholders are
therefore advised that in order to obtain a full understanding of the nature of the auditor's engagement they should obtain a
copy of the auditor's review report together with the accompanying financial information from IPL's registered office.
Interim distribution with the election to reinvest the cash distribution for units
Notice is hereby given of an interim distribution declaration number 6 of:
- 4.81137 AUD cents per unit pre WHT
- 4.64164 AUD cents per unit post WHT
for the six months ended 30 September 2016. Withholding tax of 0.16973 Australian cents per unit will be withheld from the
distribution paid to non-Australian unitholders. This is regarded as a foreign distribution for South African unitholders.
Unitholders have been provided with the election to re-invest the South African Rand ("Rand") equivalent of the cash distribution
of 4.64164 Australian cents per unit ("Cash Distribution") in return for units ("Re-Investment Alternative Units"). Unitholders
will be entitled, in respect of all or part of their unitholding, to elect to receive Re-Investment Alternative Units, failing which they
will receive the Cash Distribution, converted to Rand at the spot exchange rate on the day prior to the finalisation date, which
will be paid to those unitholders not electing to receive the Re-Investment Alternative Units.
The number of Re-Investment Alternative Units to which unitholders are entitled will be determined with reference to the ratio
that the post withholding tax Cash Distribution bears to the ratio price (being the five-day volume weighted average traded
price (ex-distribution) of units on the JSE prior to the finalisation date). The price and exchange rate for conversion of the Cash
Distribution to Rand will be announced on the finalisation date, which will be no later than Tuesday, 29 November 2016.
Unitholders who have dematerialised their units are required to notify their duly appointed Central Securities Depository
Participant ("CSDP") or broker of their election in the manner and time stipulated in the custody agreement governing the
relationship between the unitholder and their CSDP or broker.
In terms of the listings requirements of the JSE Limited, the following additional information is disclosed:
- The Cash Distribution portion has been declared from the Fund's reserves.
- As at the date of this announcement, the Fund has 322 359 497 ordinary units of no par value each in issue
A circular to unitholders in respect of the election being offered to unitholders to receive either the Cash Distribution or the
Re-Investment Alternative Units, together with a form of election, will be posted to unitholders today, Wednesday,
16 November 2016 and will also be available from today on the Fund's website at https://protect-eu.mimecast.com/s/1ZXkBCLQobca
Fractions
Trading in the STRATE environment does not permit fractions and fractional entitlements. Accordingly, where a Unitholder's
entitlement to Re-Investment Alternative Units, gives rise to a fraction of a Re-Investment Alternative Unit, such fraction
will be rounded down to the nearest whole number with the balance being paid to the unitholder in cash as part of the
Cash Distribution.
Foreign unitholders
The distribution of this announcement and/or accompanying documents and the right to receive Re-Investment Alternative
Units in jurisdictions other than the Republic of South Africa may be restricted by law and a failure to comply with any of
these restrictions may constitute a violation of the securities laws of any such jurisdictions. The Re-Investment Alternative Units
have not been, and will not be, registered for the purposes of the election under the securities laws of the United Kingdom,
European Economic Area or EEA, Canada, United States of America or Japan and accordingly are not being offered, sold,
taken up, re-sold or delivered directly or indirectly to recipients with registered addresses in such jurisdictions.
Tax implications
The Fund and its management arrangements are structured to meet the required criteria to be classified as a Managed
Investment Trust for Australian tax purposes. As a Managed Investment Trust, the responsible entity will be required to withhold
tax in Australia at a concessional rate of 15% on distributions to individual and institutional unitholders in South Africa. However,
the effect of this tax on the Fund's distribution for the period from 1 April 2016 to 30 September 2016 has been reduced to
3.57348%, equivalent to 0.16973 Australian cents per unit, through certain deductions such as depreciation. Thus, withholding
tax of 0.16973 Australian cents per unit will be withheld from the distribution accruing to unitholders and will be paid to the
Australian Taxation Office.
The distribution is not subject to dividend withholding tax in South Africa. The distribution, net of withholding tax, received by
South African institutional and individual unitholders will constitute income and will be subject to income tax in South Africa
at the unitholder's marginal tax rate. Tax paying unitholders will be able to claim a rebate against the withholding tax paid in
Australia. Non-tax paying unitholders will not be entitled to claim a rebate.
A worked example illustrating the impact for individual and institutional unitholders will be announced as part of the finalisation
information on SENS on the finalisation date.
The above summary of the tax treatment of the foreign distribution does not constitute legal or tax advice and is based on
taxation law and practice at the date of this circular. Unitholders should take their own tax advice as to the consequences of
their investment in the Fund and are encouraged to consult their professional advisors should they be in any doubt as to the
appropriate action to take.
Salient dates and times
A summary of the salient dates relating to the Cash Distribution and election to receive Re-Investment Alternative Units is as
follows:
2016
Circular and form of election sent to unitholders Wednesday, 16 November
Announcement of Re-Investment Alternative Units issue price and finalisation information
(including exchange rate to convert the Cash Distribution to Rand) ("Finalisation Date") Tuesday, 29 November
Last day to trade ("LDT") cum distribution Tuesday, 6 December
Units to trade ex-distribution Wednesday, 7 December
Listing of maximum possible number of Re-Investment Alternative Units commences on the JSE Friday, 9 December
Last day to elect to receive Re-Investment Alternative Units (no late forms of election will be
accepted) at 12:00 (South African time) Friday, 9 December
Record date Friday, 9 December
Announcement of results of Cash Distribution and Re-Investment Alternative Units on SENS Monday, 12 December
Cheques posted to certified unitholders and accounts credited by CSDP or broker
dematerialised unitholders electing the Cash Distribution on or about Monday, 12 December
Unit certificates posted to certificated unitholders and accounts credited by CSDP or broker
to dematerialised unitholders electing to receive Re-Investment Alternative Units on or about Wednesday, 14 December
Adjustment to units listed on or about Monday, 19 December
Notes:
1. Unitholders electing to receive Re-Investment Alternative Units are requested to note that the Re-Investment Alternative Units will be listed on LDT + 3 as
the settlement of the Re-Investment Alternative Units will occur three days after record date, which differs from the conventional one day after record date
settlement process.
2. Units may not be dematerialised or rematerialised between the commencement of trade on Wednesday, 7 December 2016 and close of trade on Friday,
9 December 2016.
By order of the board
Investec Property Limited
Company Secretary
16 November 2016
Responsible entity Manager
Investec Property Limited Investec Property Management Pty Limited
(ACN 071 514 246 AFSL 290 909) (ACN 161 587 391)
Level 23, Chifley Tower Level 23, Chifley Tower
2 Chifley Square 2 Chifley Square
Sydney Sydney
New South Wales New South Wales
2000 2000
Australia Australia
Directors of the responsible entity Transfer secretaries
Richard Longes# (Non-executive chairman) Computershare Investor Services Proprietary Limited
Stephen Koseff (Non-executive) 70 Marshall Street
Graeme Katz (Executive) Johannesburg
Samuel Leon (Non-executive) 2001
Sally Herman# (Non-executive) (PO Box 61051, Marshalltown, 2107)
Hugh Martin# (Non-executive) Phone: +27 11 370 5159
#Independent
Sponsor
Directors of the manager
The Corporate Finance division of Investec Bank Limited
Graeme Katz (Executive) 2nd Floor
Zach McHerron (Executive) 100 Grayston Drive
Kristie Lenton (Executive) Sandown
Samuel Leon (Non-executive) Sandton
2196
Investec Australia Property Fund (PO Box 785700, Sandton, 2146)
Registered in Australia in terms of ASIC (ARSN 162 067 736)
Registered in terms of the Collective Investment Schemes Custodian
Control Act No. 45 of 2003 Perpetual Corporate Trust Limited
Share code: IAP (ACN 000 341 533)
ISIN: AU60INL00018 Level 12, 123 Pitt Street
Sydney
Company secretary of the responsible entity New South Wales
2000
Australia
Paul Lam-Po-Tang (BCom, LLB)
Registered office and postal address
of the responsible entity and date of
establishment of the Fund
AUSTRALIA:
Level 23, Chifley Tower
2 Chifley Square
Sydney
New South Wales
2000
Australia
LOCAL REPRESENTATIVE OFFICE:
2nd Floor
100 Grayston Drive
Sandown
Sandton
2196
Established on 12 December 2012 in Sydney, Australia.
Registered as a Managed Investment Scheme with ASIC under
the Corporations Act 2001 on 6 February 2013. On 23 August
2013 the Registrar of Collective Investment Schemes authorised
the Fund to solicit investments in the Fund from members of the
public in the Republic of South Africa in terms of Section 65 of
the Collective Investment Schemes Control Act, 45 of 2002, as
amended.
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