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INVESTEC PROPERTY FUND LIMITED - Financial results 2019

Release Date: 14/05/2019 08:00
Code(s): IPF     PDF:  
 
Wrap Text
Financial results 2019

Investec Property Fund Limited
(Incorporated in the Republic of South Africa)
(Registration number 2008/011366/06)
Share code: IPF       ISIN: ZAE000180915
(Income tax reference number 9332/719/16/1)

FINANCIAL RESULTS 2019

Reviewed preliminary condensed
consolidated financial results
Investec Property Fund Limited

KEY HIGHLIGHTS
FOR THE YEAR ENDED 31 MARCH 2019

5.1%
Normalised full year
distribution growth

142.3 cps
(March 2018: 135.4 cps(1))

2.4%2
vacancy reduced in a
challenging environment
(March 2018: 4.0%)

94.2%
of space expired in the period
renewed or re-let at an average
reversion of negative 6.9%

R3.7 billion
debt re-finance concluded.
(resulting in an extended expiry profile)

Balance sheet composition

South Africa            Europe
84.8%                   8.0%

Australia               U.K.
6.1%                    1.1%

3.9%
increase in net asset value
driven by the performance
of offshore investments

3.5 years
weighted average debt expiry increased
(March 2018: 2.7 years)

7.9%
all in cost of funding decreased
(March 2018: 8.6%)

EUR 26.0%
total returns from Pan-European
logistics portfolio
11.6% income yield
14.4% capital uplift

(1) Excluding 3.1cps Investec Australia Property Fund once off rights
    offer dividend.
(2) Including strategic development vacancy 3.0% (March 2018: 4.8%).

THE YEAR IN REVIEW

     Full year distribution growth of 5.1% - in line
     with guidance; majority of distribution growth
     driven by Pan-European logistics investment.

South Africa
  -   Macro-economic environment remains
      challenging - expectation of further
      deterioration into FY2020
  -   Like-for-like net property income growth of
      0.8% - reflective of local market conditions
  -   Edcon rental concession agreed - no
      impact on FY2019 but will impact FY2020
      dividend growth by 1%
  -   Agreed share repurchase by Ingenuity - will
      deliver a 29% profit and provides clarity to
      shareholders

Offshore
  -   Offshore exposure increased to 15.2%
      - EUR88.4 million deployed into the Pan-
      European logistics platform during the year
  -   Pan-European logistics platform
      performance ahead of deal plan with 26%
      total return (in Euro) - driven by strong
      leasing activity, quality on-the-ground team
      and well-positioned asset base
  -   Additional EUR64.5 million committed to new
      Pan-European light industrial platform
      post year end - will complement the existing
      logistics strategy, provide further offshore
      exposure and deliver earnings accretion for
      shareholders
  -   Potential sell down of 10% of Investec
      Australia Property Fund - proceeds will
      be recycled on an earnings and net asset
      value ('NAV') enhancing basis

Balance sheet
  -   LTV of 35.9% and R3.7 billion refinancing
      completed in H2
  -   Continual assessment of capital allocation
      to manage gearing and ensure capital
      deployment into assets that generate the
      most attractive risk adjusted return
  -   R0.5 billion of South African property sold
      during the year and R0.6 billion earmarked
      to be recycled to reduce leverage or support
      European expansion activity

  Fund is well positioned to take advantage of 
  market dynamics

  Guidance for the next 12 months of 3-5% dps growth,
  despite the impact of the Edcon restructure

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
                                                                                                                         Reviewed             Audited   
                                                                                                                       Year ended          Year ended   
R'000                                                                                                   Notes       31 March 2019       31 March 2018   
Revenue, excluding straight-line rental revenue adjustment                                                              1 812 380           1 810 542   
Straight-line rental revenue adjustment                                                                                    31 944              52 698   
Revenue                                                                                                                 1 844 324           1 863 240   
Property expenses                                                                                                       (340 461)           (303 356)   
Net property income                                                                                                     1 503 863           1 559 884   
Other operating expenses                                                                                                 (95 619)            (72 604)   
Operating profit                                                                                                        1 408 244           1 487 280   
Fair value and foreign exchange adjustments                                                                 2             406 657             230 684   
Expected credit losses                                                                                      5            (30 000)                   -   
(Loss)/profit on disposal of investment property                                                                         (19 896)               2 655   
Income from other investments(1)                                                                                          116 854             107 530   
Finance costs                                                                                                           (618 710)           (590 360)   
Finance income(2)                                                                                                          18 579              19 771   
Finance income from associate(2)                                                                                           30 058                   -   
Finance income from loans to associates at fair value through profit or loss                                              129 354                   -   
Profit before taxation                                                                                                  1 441 140           1 257 560   
Taxation                                                                                                    6            (15 176)             (9 870)   
Total comprehensive income attributable to equity holders                                                               1 425 964           1 247 690   
Distribution reconciliation                                                                                                                             
Total comprehensive income attributable to equity holders                                                               1 425 964           1 247 690   
Less: Straight-line rental revenue adjustment                                                                            (31 944)            (52 698)   
Fair value adjustments and foreign exchange gains/(losses)                                                              (406 657)           (230 684)   
Loss/(profit) on disposal of investment property                                                                           19 896             (2 655)   
Izandla mezzanine interest not received                                                                                  (10 464)               (800)   
Add: Investment dividend accrual (net of withholding tax ('WHT'))(1)                                                        2 330              30 124   
Notional cost of funding Ingenuity acquisition(3)                                                                           8 794               7 576   
Expected credit losses                                                                                                     30 000                   -   
Deferred taxation                                                                                                           8 380               2 765   
Antecedent dividend(4)                                                                                                      1 553               2 867   
Less: Interim dividend paid                                                                                             (506 615)           (491 018)   
Final dividend                                                                                                            541 237             513 167   
Number of shares                                                                                                                                        
Shares in issue                                                                                                       736 290 993         731 400 437   
Weighted average number of shares in issue                                                                            735 275 468         722 796 837   
Cents                                                                                                                                                   
Total dividend per share(5)                                                                                                142.32              138.53   
Final dividend per share                                                                                                    73.51               70.16   
Interim dividend per share                                                                                                  68.81               68.37   
Basic and diluted earnings per share                                                                                       193.94              172.62   
Headline earnings per share                                                                                 1              199.84              106.41   

(1) Investec Property Fund Limited ('the Fund' or 'IPF') considers the expected future Investec Australia Property Fund ('IAPF') dividend and the Investec Argo
    Property Fund ('U.K. Fund' or 'U.K. Investment') (legal name 'Nestor Investment Holdings Limited') dividend, relating to the earnings from the current period,
    to be part of the distributable earnings for the current period. Accordingly an adjustment is made to match the anticipated income of the distribution to the
    period to which the distribution relates.
(2) Finance income is calculated on the effective interest rate method.
(3) The Fund's investment into Ingenuity Property Investments Limited ('Ingenuity') was made on a total return basis. From a distribution perspective, the Fund's
    policy in relation to total return is to add back the funding cost of the investment, net of dividends received.
(4) The antecedent dividend arises from the share issue of 4 890 556 shares in June 2018 (prior year: 13 250 270 shares issued in November 2017).
(5) Excluding the once-off antecedent dividend received from IAPF of R22.2 million in FY2018, the normalised dividend per share for the prior year is 135.43 cents
    per share, resulting in normalised growth of 5.1% year-on-year.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
                                                                                                                         Reviewed             Audited   
                                                                                                                         31 March            31 March   
R'000                                                                                                   Notes                2019                2018   
ASSETS                                                                                                                                                  
Non-current assets                                                                                                     20 374 809          19 085 578   
Investment property                                                                                         3          16 212 471          17 004 260   
Straight-line rental revenue adjustment                                                                                   488 049             476 955   
Derivative financial instruments                                                                            4              55 074              39 141   
Other investments                                                                                           4           1 627 463           1 357 987   
Equity accounted investment in and loans to associate                                                       5             212 197             207 235   
Loans to associates at fair value through profit or loss(1)                                                 4           1 779 555                   -   
Current assets                                                                                                            711 498             749 642   
Trade and other receivables                                                                                               286 414             218 866   
Cash and cash equivalents(2)                                                                                              382 940             507 338   
Current portion of derivative financial instruments                                                         4              42 144              23 438   
Non-current assets held-for-sale                                                                            7             583 660             117 654   
Total assets                                                                                                           21 669 967          19 952 874   
EQUITY AND LIABILITIES                                                                                                                                  
Shareholders' interest                                                                                                 13 131 073          12 643 769   
Stated capital                                                                                                         10 264 843          10 186 582   
Retained earnings                                                                                                       2 866 230           2 457 187   
Non-current liabilities                                                                                                 7 083 551           6 032 267   
Long-term borrowings                                                                                        8           6 841 296           5 917 743   
Derivative financial instruments                                                                            4             225 724             106 373   
Deferred taxation                                                                                           6              16 531               8 151   
Current liabilities                                                                                                     1 455 343           1 276 838   
Trade and other payables                                                                                                  346 053             401 397   
Current portion of long-term borrowings                                                                     8           1 103 872             839 000   
Current portion of derivative financial instruments                                                         4               5 418              36 441   
Total equity and liabilities                                                                                           21 669 967          19 952 874   
Shares in issue                                                                                                       736 290 993         731 400 437   
Net asset value per share (cents)                                                                                           1 783               1 729   

(1) Loans to associates have arisen in the current year due to the investment into the Pan-European Logistics ('PEL') portfolio. Investec Property Fund
    Offshore Investments Proprietary Limited ('IPFO') is a wholly-owned subsidiary of Investec Property Fund Limited. IPFO consolidates AREG Hexagon Co-Invest
    Vehicle II, L.P. ('AREG L.P.') which in turn owns 42.9% of the share capital of two associate entities in Luxembourg, namely Hexagon Holdco S.a.r.l and
    Hexagon Holdco S.a.r.l. 2. ('Hexagon') These entities hold property companies which invest into direct real estate in various jurisdictions across Europe.
    The investment into AREG L.P. earns variable interest returns based on the returns in the underlying property companies. The loan amount also includes a
    convertible loan granted to Izandla Property Fund Proprietary Limited ('Izandla') of R93.7 million.
(2) The cash balance includes restricted cash relating to tenant deposits of R52.7 million as well as cash received in advance for April 2019 rentals of
    R35.4 million.

CONSOLIDATED STATEMENT OF CASH FLOWS
                                                                                                                         Reviewed             Audited   
                                                                                                                       Year ended          Year ended   
R'000                                                                                                               31 March 2019       31 March 2018   
Cash generated from operations                                                                                          1 249 131           1 320 763   
Finance income received                                                                                                    18 579              18 971   
Finance costs paid                                                                                                      (627 952)           (593 255)   
Income from investments (net of WHT)                                                                                      110 058             100 425   
Finance income from associates                                                                                            110 181                   -   
Dividends paid to shareholders                                                                                        (1 019 788)           (979 167)   
Net cash outflow from operating activities                                                                              (159 791)           (132 263)   
Capital expenditure and acquisitions of investment property                                                             (182 031)           (358 103)   
Proceeds on disposal of investment property                                                                               500 478             672 444   
Investment in Ingenuity                                                                                                         -            (20 755)   
Investment in U.K. Fund                                                                                                  (11 471)           (173 329)   
Investment in Izandla                                                                                                   (115 637)           (188 988)   
Loans to Hexagon                                                                                                      (1 380 803)                   -   
Net cash outflow from investing activities                                                                            (1 189 464)            (68 731)   
Shares issued, net of costs                                                                                                81 128             207 319   
Term loans raised                                                                                                               -             200 000   
Term loans repaid                                                                                                     (2 324 740)           (121 432)   
Commercial paper issued and repaid (net)                                                                                  178 000              12 000   
Corporate bonds issued                                                                                                  2 815 000             800 000   
Corporate bonds repaid                                                                                                  (365 000)           (526 000)   
Foreign debt raised                                                                                                       840 469                   -   
Derivative financial instruments settled                                                                                        -            (22 932)   
Net cash inflow from financing activities                                                                               1 224 857             548 955   
Net (decrease)/increase in cash and cash equivalents                                                                    (124 398)             347 961   
Cash and cash equivalents at the beginning of the year                                                                    507 338             159 377   
Cash and cash equivalents at the end of the year                                                                          382 940             507 338   

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
                                                                                                                         Retained                       
R'000                                                                                          Stated capital            earnings        Total equity   
Balance at 31 March 2017                                                                            9 999 838           2 168 089          12 167 927   
Total comprehensive income attributable to equity holders                                                   -           1 247 690           1 247 690   
Shares issued net of costs                                                                            207 319                   -             207 319   
Dividends declared and paid                                                                                 -           (979 167)           (979 167)   
Transfer between reserves(1)                                                                         (20 575)              20 575                   -   
Balance at 31 March 2018                                                                           10 186 582           2 457 187          12 643 769   
Total comprehensive income attributable to equity holders                                                   -           1 425 964           1 425 964   
Shares issued net of costs                                                                             81 128                   -              81 128   
Dividends declared and paid                                                                                 -         (1 019 788)         (1 019 788)   
Transfer between reserves(2)                                                                          (2 867)               2 867                   -   
Balance at 31 March 2019                                                                           10 264 843           2 866 230          13 131 073   

(1)   Results from antecedent dividends in relation to shares issued in March 2017 and November 2017.
(2)   Results from antecedent dividends in relation to shares issued in June 2018.

CONSOLIDATED SEGMENTAL INFORMATION

Segmental analysis

The Fund determines and presents operating segments based on the information that is provided internally to the Executive Management
Committee ('Exco'), the Fund's operating decision-making forum. The Fund is comprised of seven segments, namely Retail, Office,
Industrial, South African investment portfolio, Australia, U.K. and Europe. The operating segment's operating results are reviewed regularly
by Exco to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial
information is available.

Segment                 Brief description of segment
Office                  The office portfolio consists of 31 properties which includes single and multi-tenanted P, A and B grade office space.

Industrial              The industrial portfolio consists of 38 properties which includes warehousing, standard units, high grade industrial,
                        high-tech industrial and manufacturing.

Retail                  The retail portfolio consists of 33 properties, comprising shopping centres as well as retail warehouses, motor
                        dealerships and high street properties.

South Africa -          The local investment portfolio consists of a 35% share of an empowerment vehicle, Izandla valued at R0.3 billion and
Investment portfolio    a 9.2% share in Ingenuity valued at R0.1 billion which the Fund has agreed to sell back to Ingenuity for 29% above
                        original purchase price.

Australia               A 20.9% investment into IAPF which is inward listed on the JSE and valued at R1.3 billion.

U.K.                    A 10% investment into the U.K. Fund valued at R0.2 billion.

Europe                  A 42.9% investment into a PEL portfolio valued at R1.7 billion. This portfolio consists of 25 properties located in six
                        jurisdictions across Europe.

New segments have been identified in the current year as a result of the increase in the materiality of various investments, previously not
allocated to individual segments. Comparatives have been restated to be presented on a consistent basis.

Profit or loss and assets and liabilities disclosure
                                                       South African property portfolio                             Investment portfolio
R'000                                                                                               South                                                   
                                                                                                  African                                                   
                                                                                      Total/   investment                                                   
2019                                            Office   Industrial      Retail   Fund Level    portfolio   Australia       U.K.      Europe        Total   
Revenue, excluding straight-line rental                                                                                                                     
revenue adjustment                             685 132      425 544     701 704    1 812 380                                                    1 812 380   
Straight-line rental revenue adjustment            183       13 766      17 995       31 944                                                       31 944   
Revenue                                        685 315      439 310     719 699    1 844 324                                                    1 844 324   
Property expenses                            (146 548)     (64 433)   (129 480)    (340 461)                                                    (340 461)   
Net property income                            538 767      374 877     590 219    1 503 863                                                    1 503 863   
Other operating expenses                                                            (95 619)                                                     (95 619)   
Operating profit                                                                   1 408 244                                                    1 408 244   
Fair value adjustments on derivatives                                                 48 942            -    (88 529)   (13 468)       (672)     (53 727)   
Fair value adjustments on investment                                                                                                                        
property                                                                            (15 490)                                                     (15 490)   
Fair value adjustments on investments                                                              16 471     220 323          -     195 334      432 128   
Net foreign exchange gains                                                                              -           -     19 277      24 469       43 746   
Expected credit losses                                                                           (30 000)           -          -           -     (30 000)   
(Loss)/profit on disposal of investment                                                                                                                     
property                                                                            (19 896)                                                     (19 896)   
Income from other investments                                                                           -     104 406     12 448           -      116 854   
Finance costs                                                                      (618 710)                                                    (618 710)   
Finance income                                                                        18 579                                                       18 579   
Finance income from associate                                                                      30 058           -          -           -       30 058   
Finance income from loans to                                                                                                                                
associates at fair value through profit or                                                                                                                  
loss ('FVTPL')                                                                                      4 669           -          -     124 685      129 354   
Profit before taxation                                                                                                                          1 441 140   
ASSETS                                                                                                                                                      
Non-current assets                                                                                                                             20 319 735   
Investment property                          6 031 857    3 482 404   6 698 210   16 212 471                                                   16 212 471   
Straight-line rental revenue adjustment                                              488 049                                                      488 049   
Other investments                                                                                 133 048   1 271 867    222 548           -    1 627 463   
Equity accounted investment in and                                                                                                                          
loans to associate                                                                                212 197           -          -           -      212 197   
Loans to associates at FVTPL                                                                       93 798           -          -   1 685 757    1 779 555   
Current assets                                                                                                                                    669 354   
Trade and other receivables                                                          286 414                                                      286 414   
Cash and cash equivalents                                                            382 940                                                      382 940   
Non-current assets held for sale                13 000      175 050     395 610      583 660                                                      583 660   
Total assets                                                                                                                                   21 572 749   

LIABILITIES                                                                                                                                                 
Non-current liabilities                                                                                                                         6 991 751   
Long-term borrowings                                                               6 841 296                                                    6 841 296   
Net derivative financial instruments                                                  45 076            -      72 824      8 856       7 168      133 924   
Deferred taxation                                                                     16 531                                                       16 531   
Current liabilities                                                                                                                             1 449 925   
Trade and other payables                                                             346 053                                                      346 053   
Current portion of long-term borrowings                                            1 103 872                                                    1 103 872   
Total liabilities                                                                                                                               8 441 676   

Profit or loss and assets and liabilities disclosure
                                                       South African property portfolio                  Investment portfolio

R'000                                                                                                                                          
                                                                                               South African                                            
                                                                                      Total/      investment                                            
2018                                            Office   Industrial      Retail   Fund Level       Portfolio  Australia          U.K.           Total   
Material profit or loss disclosures                                                                                                                     
Revenue, excluding straight-line rental                                                                                                                 
revenue adjustment                             699 193      431 003     680 346    1 810 542                                                1 810 542   
Straight-line rental revenue adjustment          9 056       22 121      21 521       52 698                                                   52 698   
Revenue                                        708 249      453 124     701 867    1 863 240                                                1 863 240   
Property expenses                            (118 990)     (60 414)   (123 952)    (303 356)                                                (303 356)   
Net property income                            589 259      392 710     577 915    1 559 884                                                1 559 884   
Other operating expenses                                                            (72 604)                                                 (72 604)   
Operating profit                                                                   1 487 280                                                1 487 280   
Fair value adjustments on derivatives                                                      -        (75 568)     63 076         (118)        (12 610)   
Fair value adjustments on investment                                                                                                                    
property                                                                             475 868                                                  475 868   
Fair value adjustments on investments                                                      -         (6 127)  (244 919)        25 596       (225 450)   
Foreign exchange losses                                                                    -               -          -       (7 124)         (7 124)   
(Loss)/profit on disposal of investment                                                                                                                 
property                                                                               2 655                                                    2 655   
Income from other investments                                                              -               -    102 132         5 398         107 530   
Finance costs                                                                      (590 360)                                                (590 360)   
Finance income                                                                        19 771                                                   19 771    
Profit before taxation                                                                                                                      1 257 560   
ASSETS                                                                                                                                                  
Non-current assets                                                                                                                         19 046 437   
Investment property                          6 203 687    3 952 113   6 848 460   17 004 260                                               17 004 260   
Straight-line rental revenue adjustment                                              476 955                                                  476 955   
Other investments                                                                          -         114 642  1 051 545       191 800       1 357 987   
Equity accounted investment in and                                                                                                                      
loans to associate                                                                         -         207 235          -             -         207 235   
Current assets                                                                                                                                726 204   
Trade and other receivables                                                          218 866                                                  218 866   
Cash and cash equivalents                                                            507 338                                                  507 338   
Non-current assets held for sale                21 034       81 066      15 554      117 654                                                  117 654   
Total assets                                                                                                                               19 890 295   

LIABILITIES                                                                                                                                             
Non-current liabilities                                                                                                                     5 845 659   
Long-term borrowings                                                               5 917 743                                                5 917 743   
Net derivative financial instruments                                               (100 551)               -     15 704         4 612        (80 235)   
Deferred taxation                                                                      8 151                                                    8 151   
Current liabilities                                                                                                                         1 240 397   
Trade and other payables                                                             401 397                                                  401 397   
Current portion of long-term                                                                                                                            
borrowings                                                                           839 000                                                  839 000   
Total liabilities                                                                                                                           7 086 056    


NOTES TO THE REVIEWED PRELIMINARY CONDENSED CONSOLIDATED FINANCIAL RESULTS
                                                                                                                         Reviewed             Audited   
                                                                                                                       Year ended          Year ended   
                                                                                                                         31 March            31 March   
R'000                                                                                                                        2019                2018   
1.   Headline earnings                                                                                                                                  
1.1  Reconciliation of basic earnings to headline earnings                                  
     Total comprehensive income attributable to equity holders                                                          1 425 964           1 247 690   
     Adjusted for: Fair value adjustments on investment property                                                           15 490           (475 868)   
     Fair value adjustment on investment property in associate                                                              7 996                   -   
     Loss/(profit) on disposal of investment property                                                                      19 896             (2 655)   
     Headline earnings attributable to shareholders                                                                     1 469 346             769 167   
     Headline earnings per share                                                                                           199.84              106.41   

1.2  Reconciliation of total dividend per share to                                                                                                     
     normalised dividend per share                                                                                                                      
     Interim dividend                                                                                                     506 615             491 018   
     Less: IAPF antecedent dividend                                                                                             -            (22 277)   
     Normalised interim dividend                                                                                          506 615             468 741   
     Shares in issue at interim reporting period                                                                      736 290 993         718 150 167   
     Normalised interim dividend per share                                                                                  68.81               65.27   
     Final dividend per share                                                                                               73.51               70.16   
     Total normalised dividend per share                                                                                   142.32              135.43   
     Total normalised dividend per share growth                                                                              5.1%                       

2.   Fair value and foreign exchange adjustments                                                                                                   
     Fair value adjustments on derivative instruments                                                                    (53 727)            (12 610)   
     Fair value adjustments on investment property                                                                       (15 490)             475 868   
     Fair value adjustment on investments(1)                                                                              256 071           (232 574)   
     Fair value adjustments on Hexagon loans(1,2,3)                                                                       259 292                   -   
     Foreign exchange translation losses on items not at fair value                                                      (39 489)                   -   
                                                                                                                          406 657             230 684   
     (1)  Included in fair value adjustments are foreign exchange gains and losses on items measured at fair value.
     (2)  The value of this loan is linked to the value of the properties in the underlying European logistics portfolio. Therefore, the movement in 
          the value of the loan is driven by the change in values of the properties.
     (3)  The fair value adjustment is net of the fair value adjustment relating to other long-term borrowings. Refer to note 4.5.


3.   Fair value of investment property
     The Fund's policy is to assess the value of investment properties at each reporting period. During the year ended 31 March 2019,
     the assessment resulted in a net downward revaluation of R15.5 million (March 2018: upward revaluation of R475.9 million). The
     directors' valuation method is the income capitalisation method which is a generally accepted methodology used in the industry.
     Each property is required to be revalued externally every three years. In the interest of transparency, the Fund elected to increase
     the number of properties that are revalued externally from one-third to one-half of total properties and to use a second valuer. As
     a result, 50 properties (49% of the portfolio) were revalued externally in the current year. 27 properties were valued by Mills Fitchet
     Magnus Penny Proprietary Limited and 23 by Spectrum Valuations and Asset Solutions Proprietary Limited. Both valuers are
     registered in terms of Section 19 of the Property Valuers Professional Act, No. 47 of 2000.

4.   Financial instruments
     Financial instruments held at fair value by the Fund include the Investment in IAPF, the Investment in Ingenuity, the U.K. Investment,
     the loans relating to the investment in the PEL platform, the Izandla convertible loan, derivatives, and certain long term
     borrowings.

     * The valuations of IAPF and Ingenuity are based on the closing share price times the number of shares held at the reporting date,
       which is a level 1 valuation.

     * The U.K. investment is an unlisted company and their shares are not traded on a regulated exchange, therefore there are
       significant unobservable inputs used to determine the fair value, making it a level 3 valuation.

     * The profit participating loans ('PPL') receivable and payable are valued based on the value of the underlying investment properties.
       There are significant unobservable inputs used to determine the fair value of these loans, making them level 3 valuations.

     * The Izandla convertible loan is based on the present value of future cash flows plus the value of the option to convert, making it a
       level 3 valuation.

     * Derivative financial instruments hedge interest rate and foreign exchange risk. Interest rate hedging instruments are valued by
       discounting future cash flows using the market rate indicated on the interest rate curve at the dates when the cash flows will
       take place. Foreign exchange hedging instruments are valued by making reference to market prices for similar instruments and
       discounting for the effect of the time value of money. Derivatives are considered to be level 2 valuations.

     Refer to note 4.4 for detail on the fair value hierarchy.

     Cash and cash equivalents, trade and other receivables, trade and other payables and variable rate loans are carried at amortised
     cost and the carrying value is a reasonable approximation of fair value.


                                                                                                                         Reviewed             Audited   
                                                                                                                       Year ended          Year ended   
                                                                                                                         31 March            31 March   
R'000                                                                                                                        2019                2018   
4.1  Listed investments                                                                                                                                  
     Investment in IAPF                                                                                                 1 271 867           1 051 544   
     % holding                                                                                                              20.9%               20.9%   
     Investment in Ingenuity                                                                                              133 048             114 643   
     % holding                                                                                                               9.2%                9.2%   
     Total fair value                                                                                                   1 404 915           1 166 187   
     
     The Fund carries its investments in IAPF and Ingenuity at fair value through profit or loss. IAPF is classified as an associate and   
     Ingenuity is classified as an investment.                                                                                                     
                                                                                                                         Reviewed             Audited   
                                                                                                                       Year ended          Year ended   
                                                                                                                         31 March            31 March   
R'000                                                                                                                        2019                2018   
4.2  Unlisted investments                                                                                                                                
     U.K. investment                                                                                                      222 548             191 800   
     % holding                                                                                                              10.0%               10.0%   

     The Fund carries its U.K. investment at fair value through profit or loss and classifies it as an investment.


                                                                                                                         Reviewed             Audited   
                                                                                                                       Year ended          Year ended   
                                                                                                                         31 March            31 March   
R'000                                                                                                                        2019                2018   
4.3  Loans to equity accounted associates at fair value                                                                                             
     through profit or loss                                                                                                                             
     PEL platform                                                                                                                                       
     Finance income accrual                                                                                                36 110                   -   
     Loans to Hexagon                                                                                                   1 649 647                   -   
     IPFO has invested into the PEL platform which has advanced PPL's to Hexagon.                                                                       
     The return and repayment of PPL's owed by the Hexagon entities comprises                                                                           
     42.9% of the net rental income earned on leasing the investment properties held                                                                    
     by the underlying property companies.                                                                                                              
     The Hexagon entities have an obligation to deliver all returns to AREG L.P. via the                                                                
     PPL's and therefore the equity of this associate is valued at nil.                                                                                 
     Izandla                                                                                                                                            
     Convertible shareholder loan                                                                                          93 798                   -   
     The convertible shareholder loan was provided to part fund the Sasol                                                                               
     development, with the option of conversion to equity upon completion of the                                                                        
     development.                                                                                                                                       
     The carrying amount of the Izandla convertible loan approximates the fair value.                                                                   
     Total                                                                                                              1 779 555                   -   


                                                                                                                                           Carried at   
                                                                               Carried at                                                   amortised   
R'000                                                                          fair value         Level 1       Level 2        Level 3           cost   
4.4  Fair value hierarchy                                                                                                                           
     at 31 March 2019                                                                                                                                   
     Assets                                                                                                                                             
     Investment in IAPF                                                         1 271 867       1 271 867             -              -              -   
     Investment in Ingenuity                                                      133 048         133 048             -              -              -   
     Investment in the U.K. Fund                                                  222 548               -             -        222 548              -   
     Equity accounted investment in and                                                                                                                 
     loans to associate                                                                 -               -             -              -        178 955   
     Loans to equity accounted associates                                                                                                               
     at FVtPL                                                                   1 779 555               -             -      1 779 555              -   
     Other investments                                                                                                                                  
     Derivative financial instruments                                              97 218               -        97 218              -              -   
     Trade and other receivables(1)                                                     -               -             -              -        155 795   
     Cash and cash equivalents                                                          -               -             -              -        382 940   
     Total financial assets                                                     3 504 236       1 404 915        97 218      2 002 103        717 690   
     Derivative financial instruments                                             231 142               -       231 142              -              -   
     Long-term borrowings (including                                                                                                                    
     current)                                                                      77 320               -             -         77 320      7 867 848   
     Trade and other payables(2)                                                        -               -             -              -        300 258   
     Total financial liabilities                                                  308 462               -       231 142         77 320      8 168 106   


                                                                                                                                           Carried at   
                                                                               Carried at                                                   amortised   
R'000                                                                          fair value         Level 1       Level 2        Level 3           cost   
4.4  Fair value hierarchy                                                                                                                           
     at 31 March 2018                                                                                                                                   
     Assets                                                                                                                                             
     Investment in IAPF                                                         1 051 544       1 051 544             -              -              -   
     Investment in Ingenuity                                                      114 643         114 643             -              -              -   
     Investment in the U.K. Fund                                                  191 800               -             -        191 800              -   
     Equity accounted investment in and                                                                                                                 
     loans to associate                                                                 -               -             -              -        188 988   
     Other investments                                                                                                                                  
     Derivative financial instruments                                              62 579               -        62 579              -              -   
     Trade and other receivables(1)                                                     -               -             -              -        133 456   
     Cash and cash equivalents                                                          -               -             -              -        507 338   
     Total financial assets                                                     1 420 566       1 166 187        62 579        191 800        829 782   
     Derivative financial instruments                                             142 814               -       142 814              -              -   
     Long-term borrowings (including                                                                                                                    
     current)                                                                           -               -             -              -      6 756 743   
     Trade and other payables(2)                                                        -               -             -              -        332 454   
     Total financial liabilities                                                  142 814               -       142 814              -      7 089 197   

     (1) Trade and other receivables exclude prepayments which are non-financial instruments.
     (2) Trade and other payables exclude revenue received in advance and value added tax as these are non-financial instruments.

                                                                                                              Izandla                                   
                                                                                                  U.K.    convertible        Hexagon        Long-term   
R'000                                                                                    investment(1)        loan(2)        loan(3)    borrowings(4)   
4.5  Level 3 valuations                                                                                                                                  
     at 31 March 2019
     The level 3 valuations are reconciled as follows:                                                                                                  
     Balance at the beginning of the year                                                      191 800              -              -                -   
     Acquisition                                                                                11 471         93 798      1 416 914         (67 769)   
     Fair value and forex gains/(losses)                                                        19 277              -        268 843          (9 551)   
     Balance at the end of the year                                                            222 548         93 798      1 685 757         (77 320)   


     (1) The change in fair value of the underlying investment is immaterial and the majority of the movement arises from changes in exchange
         rates. If the value of the underlying properties changed by 5%, the investment value would move by R21 million.
     (2) The fair value of the conversion option of this loan is linked to the value of Izandla. If this changed by 5%, the value of the loan would
         move by R0.2 million.
     (3) The fair value gain on the Hexagon loans arose from the revaluation of the underlying properties in the PEL portfolio. The entire property
         portfolio was externally valued at 31 December 2018 by CBRE Limited. The fair value gain on the loan receivable is R203.2 million. If the
         fair value of the underlying properties was 5% higher or lower, the fair value of the Hexagon loans would be R158 million higher/lower
         than the reported closing balance.
     (4) Long-term borrowings includes other Euro Funding of EUR4.7 million. The value of the loan is linked to the performance of the underlying
         properties in the Pan-European portfolio. If the fair value of underlying properties changed by 5%, the value of the loan would move by
         R11 million.

                                                                                                              Izandla                                   
                                                                                                  U.K.    convertible       Hexagon         Long-term   
R'000                                                                                       investment           loan          loan        borrowings   
     Level 3 valuations                                                                                                                                 
     at 31 March 2018                                                                                                                                   
     The level 3 valuation of the U.K. investment is reconciled                                                                                         
     as follows:                                                                                                                                        
     Opening balance                                                                                 -              -             -                 -   
     Acquisition                                                                               173 329              -             -                 -   
     Fair value gain and forex loss                                                             18 471              -             -                 -   
     Closing balance                                                                           191 800              -             -                 -   


     Valuation techniques used to derive level 3 fair value
     The significant unobservable inputs used to derive the fair value measurements are those relating to the valuation of
     underlying investment properties. The table below includes the following descriptions and definitions relating to key
     unobservable inputs made in determining fair value:
     
     Expected rental value       The rent at which space could be let in the market conditions prevailing at the date of valuation.
     ('ERV')
     
     Equivalent yield            The equivalent yield is defined as the internal rate of return of the cash flow from the property,
                                 assuming a rise to ERV at the next review, but with no further rental growth.
     
     Long-term vacancy rate      The ERV of the expected long-term average structural vacant space divided by the ERV of the
                                 whole property. Long-term vacancy rate can also be determined based on the percentage of
                                 estimated vacant space divided by the total lettable area.
     
     Significant
     unobservable inputs         Relationship between unobservable inputs and fair value measurement
    
     Expected rental value       Increases in ERV would increase estimated fair value.
     ('ERV')
     
     Equivalent yield            Increases/decrease in the equivalent yield would result in decreases/increases in the estimated
                                 fair value.
     
     Long-term vacancy rate      Increases/decreases in the long-term vacancy rate would result in decreases/increases in the
                                 estimated fair value.
     
     The fair value of the underlying property portfolio has been determined using the income capitalisation method.

                                                                                                                         Reviewed             Audited   
                                                                                                                       Year ended          Year ended   
                                                                                                                         31 March            31 March   
R'000                                                                                                                        2019                2018   
5.   Equity accounted investment in and loans to associate                                                                                         
     Izandla                                                                                                                                            
     Equity                                                                                                                33 242              18 247   
     Loans                                                                                                                178 955             188 988   
     Senior mezzanine                                                                                                     117 658             110 786   
     Junior mezzanine                                                                                                      91 297              78 202   
     Expected credit losses                                                                                              (30 000)                   -   
                                                                                                                          212 197             207 235   
  

                                                                                                                         Reviewed             Audited   
                                                                                                                       Year ended          Year ended   
                                                                                                                         31 March            31 March   
R'000                                                                                                                        2019                2018   
6.   Taxation                                                                                                                                          
6.1  Deferred taxation                                                                                                                              
     Balance at the beginning of the year                                                                                   8 151               5 386   
     Gain on fair value of investments                                                                                      8 380               2 765   
     Balance at the end of the year                                                                                        16 531               8 151   


     A deferred tax liability arose on the fair value gain through profit or loss on Ingenuity and the U.K. investment as a result of
     these investments not being classified as REITs. The Fund holds less than 20% of Ingenuity and the U.K. investment and
     therefore these investments do not meet the definition of a 'property company' as defined under S25BB of the Income Tax Act.
     On disposal of the investments, the Fund would be subject to capital gains tax. As such deferred tax has been recognised on
     the unrealised fair value gains.

6.2  Withholding taxation                                          
     Withholding tax on IAPF dividend                                                                                       6 796               7 105   

                                                                                                                         Reviewed             Audited   
                                                                                                                       Year ended          Year ended   
                                                                                                                         31 March            31 March   
R'000                                                                                                                        2019                2018   
7.   Non-current assets held-for-sale                                                                                                              
     Office                                                                                                                13 000              21 034   
     Industrial                                                                                                           175 050              81 066   
     Retail                                                                                                               395 610              15 554   
     Balance at the end of the year                                                                                       583 660             117 654   


     The Fund will be selling 12 buildings with settlement taking place within 12 months of reporting date for a consideration of
     R583.7 million and has presented those assets as non-current assets held for sale.

                                                                                                                         Reviewed             Audited   
                                                                                                                       Year ended          Year ended   
                                                                                                                         31 March            31 March   
R'000                                                                                                                        2019                2018   
8.   Long-term borrowings                                                                                                                          
     The balance at the end of the year comprises                                                                                                       
     Long-term borrowings                                                                                               6 841 296           5 972 119   
     Long-term borrowings                                                                                               6 788 205           5 917 743   
     Interest accrual on borrowings(1)                                                                                     53 091              54 376   
     Short-term borrowings(2)                                                                                           1 103 872             839 000   
     Total borrowings                                                                                                   7 945 168           6 811 119   

     (1)  Included in trade and other payables in 2018 and subsequently moved to borrowings in 2019.
     (2)  Short-term borrowings are de-risked by the availability of revolving credit facilities and short-term headroom facilities of approximately
          R1.8 billion.

                                                                                                                         Reviewed             Audited   
                                                                                                                       Year ended          Year ended   
                                                                                                                         31 March            31 March   
R'000                                                                                                                        2019                2018   
9.   Related parties                                                                                                                               
     The table below shows the transactions and balances (not disclosed elsewhere) that the                                                             
     Fund has with related parties:                                                                                                                     
     Investec Property Proprietary Limited                                                                                                              
     Asset management fees                                                                                               (75 533)            (60 702)   
     Letting commissions                                                                                                 (21 705)            (14 078)   
     Property acquisitions(1)                                                                                                   -           (154 949)   
     Transaction fees                                                                                                     (5 415)                   -   
     U.K. Investment                                                                                                                                    
     Acquisition of 10% of the equity of a joint venture within the Investec Group(2)                                    (11 471)           (173 329)   
     Dividend received                                                                                                     11 643               5 397   
     Izandla Property Fund                                                                                                                              
     Net proceeds from sale of properties                                                                                       -             314 111   
     Movement in equity investment                                                                                         14 995              18 247   
     Movement in loans receivable (including convertible loan)                                                            113 765             188 988   
     Finance income from associates                                                                                        30 058               2 338   
     Finance income from loans to associates at fair value through profit or loss                                           4 669                   -   
     Expected credit losses                                                                                              (30 000)                   -   
     AREG L.P/Hexagon(3)                                                                                                                                  
     Loans to Hexagon entities                                                                                          1 685 757                   -   
     Finance income from loans to associate at fair value through profit or loss                                          124 685                   -   
     Investec Bank Limited Group                                                                                                                        
     Cash and cash equivalents(4)                                                                                         192 714             128 083   
     Borrowings(4)                                                                                                      (362 281)           (441 615)   
     Fair value of derivative instruments(4)                                                                            (119 949)            (60 292)   
     Nominal value of swap derivatives                                                                                (5 340 255)         (4 678 057)   
     Nominal value of FECs                                                                                                465 260             515 232   
     Rentals received                                                                                                      66 462              61 724   
     Interest received(5)                                                                                                   9 261               7 859   
     Sponsor fees paid                                                                                                      (193)               (170)   
     Corporate advisory and structuring fees paid                                                                         (3 138)             (1 250)   
     Interest paid on related party borrowings                                                                           (48 562)            (52 881)   
     Settlement of swap derivatives                                                                                             -            (16 933)   
     Net interest received on cross currency swaps                                                                         31 323              24 135   
     Interest paid on interest rate swaps                                                                                (21 494)            (21 825)   

     (1) Property acquisitions were concluded at market value.
     (2) Direct equity investment, not acquisition of equity from Investec Bank Limited Group.
     (3) AREG.L.P is a related party as it is a subsidiary of IPFO.
     (4) Included in carrying values as per the statement of financial position.
     (5) Interest is earned at the overnight safex call rate of 6.30% (FY2018: 6.55%).
 

10.  Subsequent events
  -   Post 31 March 2019, the Fund has rolled R152 million and R300 million of three-month commercial paper at margin of 45.5 and
      50.0 basis points respectively.
      
  -   The Fund settled R0.7 billion of secured debt which released R2.3 billion of properties as security.
      
  -   The Fund invested a further EUR8.2 million into the PEL platform on 17 April 2019 to part fund the acquisition of 3 buildings in the
      Netherlands and 1 building in France.
      
  -   The Fund has made available 45 million units in IAPF in order to support the IAPF listing announced on 3 May 2019.
      
  -   The Fund has agreed to the sale of its shares in Ingenuity, as part of a specific repurchase agreement, for R1.08 per share, which is
      a 29% increase on the purchase price. The sale is conditional upon Ingenuity shareholder approvals.
      
  -   On 3 May 2019 the Fund announced an investment into a Pan-European light industrial ('PELI') platform. The Fund will own 25% of
      the holding company and make an initial investment of EUR10.2 million. The Fund has committed a total of EUR64.5 million into the PELI
      which is expected to be deployed within the next two years. Further details have been included on page 23 of this announcement.


COMMENTARY

Introduction
Investec Property Fund Limited ('the Fund' or 'IPF') is a South African Real Estate Investment Trust and comprises an investment portfolio of
direct and indirect real estate investments in South Africa, Australia, the U.K. and Europe.

The portfolio of assets is high quality and geographically diverse, as shown in the table below:

                                                                                                                                        % of the
Investment                           Description                                                                                   balance sheet
South African property portfolio     102 buildings held directly in the South African portfolio, valued at R17.3 billion;                    83%

SA investment - Izandla              A 35% share of an empowerment property fund, Izandla Property Fund Proprietary Limited
                                     ('Izandla'), valued at R0.3 billion;                                                                     1%

SA investment - Ingenuity            A 9.2% share in Ingenuity Property Investments Limited ('Ingenuity') valued at R0.1
                                     billion which the Fund has conditionally agreed to sell back to Ingenuity for 29%
                                     above original purchase price;                                                                           1%

European investment                  A 42.9% investment into a Pan-European logistics ('PEL') portfolio valued at
                                     R1.7 billion. This portfolio consists of 25 properties located in 6 jurisdictions across
                                     Western Europe;                                                                                          8%

Australian investment                A 20.9% investment into Investec Australia Property Fund ('IAPF') which is inward
                                     listed on the JSE and valued at R1.3 billion; and                                                        6%

U.K. investment                      A 10% investment into the Investec Argo Property Fund ('U.K. Investment') valued
                                     at R0.2 billion.                                                                                         1%

The South African market has been very challenging, with consumers under pressure, limited new clients, lack of demand for office space and
manufacturing being depressed. Due to the strong performance of the Fund teams' efforts, underpinned by quality assets, the Fund is satisfied
with the performance of the South African portfolio albeit at 0.8% growth. The Fund remains optimistic about the long term growth prospects
in the South African market and therefore the majority of the balance sheet remains on local soil. In the short to medium term, growth is likely
to be underpinned by the offshore investments.

The Fund is committed to making progress on its four strategic objectives which will ultimately translate into increased value for all stakeholders:

- Revenue security and growth;
- Client service excellence;
- Value add asset management and capital allocation; and
- Cost efficiency and system optimisation.

Financial results
The board of directors is pleased to announce a final dividend of 73.51 cents per share ('cps') for the six months ended 31 March 2019,
bringing the total dividend for the year to 142.32 cps (FY2018: 138.53 cps, normalised 135.43 cps). The prior year interim dividend included
a once-off antecedent dividend received from IAPF relating to the final H2 dividend for FY2017 received on the shares subscribed for in the
February 2017 rights offer. On a normalised basis, year-on-year dividend per share ('dps') growth was 5.1%.

The distribution growth has largely been driven by the investment into and the performance of the PEL platform. The investment was
underpinned by strong property fundamentals and value has been unlocked by a dedicated, on-the-ground management team with a proven
track record in the European logistics sector.

The South African portfolio delivered base net property income ('NPI') growth of 0.8% (March 2018: 5.7%) in an extremely challenging
and weak local economic and operating environment. Against a backdrop of business consolidations, liquidations, and
constrained consumer spending, the South African portfolio remained robust in terms of its key operating metrics.

The letting in the South African property portfolio is testament to the quality of the assets and pro-active asset management that resulted in
a decrease in vacancy from last year to 2.4% (March 2018: 4.0%). This vacancy excludes pockets of space held vacant for development
(if included, the vacancy ratio would be 3.0% (March 2018: 4.8%)).

The Fund re-let or renewed 88% (252 716m(2)) of total space available to let for the year. This includes the letting of 64% (38 440m(2)) of opening
vacancy. Of the leases that expired during the period, 94% (214 276m(2)) was let at an average negative reversion of 6.9%, reflective of the
current letting environment. It is also a result of new lets concluded in properties which were purchased at above market rentals (for which top
slice price adjustments were made on acquisition). In addition, 33% of FY2020 expiries have already been let or renewed which further de-
risks the Fund for the year ahead. The weighted average lease expiry ('WALE') on letting concluded was 3.3 years and the average contractual
escalation was 7.7%. Incentives offered in order to let space were low at 1.7% of the value of the leases.

The total portfolio cost to income ratio increased to 18.8% (March 2018: 16.8%). This ratio is expected to remain at similar levels in the short-
to medium-term until such time as revenue growth increases closer to escalation rates. In the current market the revenue growth is suppressed
by void periods and negative reversions in the office and industrial portfolios.

Key drivers of the lower base net property income and the increased cost to income ratio were:

1. 2.6% core rental growth which is lower than contractual escalations due to void periods and lower rental reversions;
2. An increase in variable costs of 33.5% driven by letting commissions and tenant installation incentives;
3. Offset by fixed costs which increased below inflation at 3.4%;
4. Gross utility costs (water and electricity) increased by 4.9% while gross recoveries increased 8.3%; and
5. Gross rates expense increased by 25.8% as a result of significant municipal revaluation in the office portfolio, while rates recoveries only
   increased by 16.2% due to leakage from void periods.

There has been limited local acquisition activity during the year, with the focus locally being on better extracting value from the existing South
African portfolio and deploying capital into the PEL platform. The Fund made a total commitment of EUR150 million into the platform and in
the current year made an initial investment of EUR65.8 million (excluding costs) in May 2018 with further investments during the year of EUR10.1 million 
and EUR7.8 million invested subsequent to year end. This brings the total investment to date to EUR83.7 million, and the Fund has committed to a further
equity investment of EUR18.9 million to fund additional acquisitions. This will leave an equity commitment of EUR47.4 million post completion of
these transactions.

The investment was part funded through R500.5 million derived from the disposal of four South African properties (yielding 7.1%). The Fund has
earmarked a further c.R600 million of South African properties for sale within the next 12 months. Once sold those proceeds will be deployed
in the PEL platform or the newly announced PELI platform that are expected to generate attractive risk-adjusted returns.

On 3 May 2019 the Fund announced that it had concluded agreements to invest up to EUR64.5 million into a PELI platform expected to be
deployed over the next two years. The Fund will have an initial 25% share in the platform and the initial investment will amount to EUR10.2 million.
At full deployment, total equity contributed by IPF and Ares will amount to EUR150 million with IPF's equity participation representing 42.9%
through a ratcheted equity investment mechanism. The initial portfolio is expected to comprise 21 primarily light industrial properties, of which
four assets located in the Netherlands have already been acquired. A further 17 properties located across France and Germany have been
identified. The initial portfolio is expected to generate an unlevered initial asset yield of 7.2% which is expected to grow to a fully let expected
rental value ('ERV') yield of 8.2%, an investment return of 9.6%.

The Fund's investment into IAPF generated a significant contribution to net asset value ('NAV') growth in the current year as a result of a 21% increase 
in the IAPF unit price. IAPF is now trading around NAV which resulted in an uplift of R220.3 million on the Fund's investment. On a post withholding
tax ('WHT') basis, IAPF delivered distribution growth of 1.2% in AUD which translated to 4.0% in ZAR due to forward exchange contracts
('FEC's') that were in place.

As announced on 3 May 2019, IAPF intends to list on the ASX. The Fund has agreed to make available up to 45 million IAPF units currently
held by the Fund, at the final subscription price determined under the institutional bookbuild.

IAPF remains a key investment for the Fund and should all the units made available under the sale be transferred, the Fund would still retain
a c. 10% investment in IAPF. The potential proceeds from the proposed partial sale of IAPF units will likely be utilised to further de-lever the
Fund's balance sheet and/or be deployed into the PEL and recently announced PELI strategies.

The U.K. Fund delivered an income yield of 5.4% and NAV growth of 10.4% during the year as a result of proactive asset management. The
portfolio is well positioned for the future and provides a solid base platform from which to grow a strong U.K. focused property platform. The
portfolio is currently valued at GBP233.8 million and has a weighted average unexpired lease term ('WAULT') of 11.7 years, vacancy ratio of 2.2%
and weighted average debt and swap expiry of 3.7 and 7.7 years respectively.

The Fund's NAV has increased by 3.9% during the year. This was primarily driven by the upward revaluation of the IAPF investment
(R220.3 million), and the Fund's share of the revaluation of the underlying properties in the PEL portfolio (R203.2 million). This was offset by a
R15.5 million (0.1%) downward revaluation of the South African property portfolio, reflective of the challenging local market.

Balance sheet and treasury management remains a fundamental focus area and the Fund continues to adopt a conservative approach to
its balance sheet position. During the year R3.7 billion of bank refinancing was completed which significantly reduced refinance risk over the
next two years and extended the debt expiry profile from 2.7 years to 3.5 years. Debt expiring in the next 18 months amounts to R1.1 billion,
with agreements already in place to refinance 23% of this and R1.2 billion of unutilised, committed facilities in place to mitigate the risk of the
remaining R0.85 billion. Subsequent to year end, over R1 billion of interest rate swaps were restructured which extended the swap expiry by eight
months to 3.4 years from 2.8 years at no additional cost to the Fund. The average cost of funding reduced from 8.6% to 7.9% due to an
increase in the percentage of foreign debt utilised to fund the European investments.

IPF has a recognised brand as a result of its association to the Investec Group and a track record in property given the experience of Investec
Property Proprietary Limited ('the Manager'). Just as Investec's clients have high service level expectations, so too do the Fund's clients.
The Fund's high quality service delivery is a way of differentiating the business in a fairly commoditised industry. Furthermore, the Fund has a
legacy of hands-on property skills and will be actively deploying resources to ensure that the IPF portfolio remains distinctive and relevant in
the markets in which the Fund operates.

South African property portfolio
The South African direct property portfolio accounts for 83% of the Fund's balance sheet investments and this remains the core focus of the
dedicated South African based team who have the local knowledge and expertise to unlock value for shareholders. The Fund's current
property portfolio consists of a diverse base of 102 quality and well located properties with an average value per property of R169 million.
(March 2018: R167 million). The Fund aims to ensure that it owns best of breed assets that will provide a platform to underpin long-term
shareholder returns.

The table below presents a snapshot of the property portfolio as at 31 March 2019:

                                                                     Total                  Office                Industrial              Retail   
Portfolio                                                       FY19        FY18         FY19      FY18         FY19      FY18         FY19      FY18   
Number of properties                                             102         106           31        32           38        40           33        34   
Asset value (Rbn)                                               17.3        17.6          6.3       6.5          3.7       4.1          7.3       7.0   
Base growth                                                     0.8%        5.7%       (2.6%)      4.7%       (1.0%)      4.4%         5.6%      7.8%   
Cost to income                                                 18.8%       16.8%        21.4%     17.0%        15.1%     14.0%        18.5%     18.2%   
GLA                                                        1 197 921   1 240 851      249 243   251 678      531 501   574 262      417 177   414 911   
Vacancy(1)                                                      2.4%        4.0%         7.3%      5.4%         1.2%      5.7%         1.0%      1.1%   
WALE (years)                                                     2.8         3.3          2.8       3.3          2.9       3.7          2.9       3.0   
In-force escalations                                            7.6%        7.6%         8.0%      8.0%         7.7%      7.9%         7.3%      7.3%   


(1)  Excludes planned vacancy in the retail portfolio for development of 9 000m(2) (March 2018: 8 636m(2)). If included the portfolio vacancy would be 3.0%
    (March 2018: 4.8%) and the retail vacancy ratio would be 2.6% (March 2018: 3.3%).

Letting activity
The Fund has re-let or renewed 94% of space that expired in the current year at a negative reversion of 6.9% which is reflective of the current
market but in line with the Fund's strategy to fill space rather than have void periods. The level of incentives offered to let space has increased
in the current year but still remains low at 1.7% of total lease value.

The table below reflects the letting activity for the year to date:

                                                       % of                                                                                             
                                  Renewals     expiries and      Gross      Gross                                                                       
                 Expiries and      and new         cancell-     expiry        new        Rental        Average               Incentive                  
                cancellations         lets           ations     rental     rental     reversion     escalation      WALE       % lease      Retention   
                          GLA          GLA              let     R/m(2)     R/m(2)             %              %     years         value              %   
Office                 52 914       45 674             86.3        193        166       (13.9)1            7.9       5.0           4.5           68.2   
Industrial            116 314      110 983             95.4         61         57        (6.4)2            7.9       1.9           1.2          47.24   
Retail                 58 280       57 619             98.9        155        159          2.63            7.1       4.8           1.1           91.3   
Subtotal              227 508      214 276             94.2        115        107         (6.9)            7.7       3.3           1.9           62.9   
Opening                                                                                                                                                 
vacancy                59 902       38 440             64.2        n/a         67           n/a            7.0       5.6           0.8            n/a   
Total                 287 410      252 716             87.9        115        102         (6.9)            7.6       3.7           1.7           62.9   


(1)  Negative reversion driven by the current letting environment and new letting concluded at properties purchased above market rentals (for which top slice
     price adjustments were made at acquisition with the benefit of higher initial yields e.g. 3 and 4 Sandown Valley Crescent) has driven the negative reversion.
(2)  Long-term leases where expiry rentals had escalated above current market, renewed at market.
(3)  Reversion subdued due to renewals concluded with two national clients of five and seven years respectively. Excluding these renewals, the balance of
     letting activity reflected growth of 5.3%.
(4)  Low retention due to two clients not renewing 8 549m(2) and 21 441m(2) respectively. The first was acquired by a large multi-national with multiple facilities
     and the operations were consolidated and the second, due to consolidated business operations and reduced space. Both spaces have however been re-let.


Sectoral performance

Office
The Fund's office portfolio comprises high quality and well-located properties. The market has been subdued as a result of rental growth
remaining under pressure with visible or foreseeable oversupply across all major offices nodes, in particular Sandton, Bryanston and within
the next 18 months, Rosebank. No demand led drivers are evident in the current market, however the Fund believes it has the skills and the
portfolio to create solutions that are attractive to clients.

Vacancies have increased to 7.3% (March 2018: 5.4%), driven by a large vacancy in Sandton that became available at end February 2019 as
well as the Firs which is undergoing refurbishment. This is expected to reduce below 6% shortly after financial year-end.

The office sector re-let or renewed 86% (45 674m(2)) of space expiring during the financial year and let a further 24% (3 328m(2)) of the opening
vacancy. This further demonstrates the quality of the underlying portfolio.

The downward pressure on rentals with longer void period and increased incentive costs for landlords to secure clients has resulted in negative
NPI growth of 2.6%. The portfolio has experienced a large increase in its cost to income ratio due to significant increases in rates valuations
on a number of properties, and substantially higher leasing associated costs relative to the prior period.

The Fund's Sandton portfolio is defensive with a WALE of 3.5 years and expiries of only 4 434m(2) in FY2020, with renewals already concluded
on this space.

Looking forward, the Fund has already concluded leases on 29% of the space expiring in FY2020, albeit at negative reversions of 10.4%,
which is an improvement on FY2019 reversions. A further 28% is either under offer or in advanced stages of negotiation.

Industrial
The industrial sector has properties with good fundamentals in strategically located nodes. It has however not been immune to the current
economic climate, which has resulted in an exceptionally tough operating environment, with smaller business, specifically in the manufacturing
sector, being the worst affected.

A lack of business confidence and economic uncertainty has translated into clients being unwilling or unable to commit to long-term leases
and therefore a sizable portion of the letting activity has been concluded on a relatively short-term basis.

Rentals remain under pressure. The expiry rentals are now at the end of long rental cycles where landlords have benefited from compounding
contractual escalations that have outstripped the market rental growth. This has resulted in negative rental reversions. This remains a fact of
life in all landlord property portfolios, however, thus far the Fund's experienced management team has managed to navigate this cycle, and has
been successful in keeping vacancies at low levels.

Despite the weak demand environment, the sector has continued to display its desirability and defensiveness with 95% of the 116 313m(2)
expiring during the year being renewed or re-let at a negative reversion of 6.4% and an average WALE of 1.9 years. The low WALE is
a result of flexible short-term deals (with cancellation flexibility in favour of the Fund) concluded on c.46 000m(2). The opening vacancy
(32 051m(2)) was 100% let with a WALE of 5.8 years resulting in a decreased vacancy for the sector of 1.2% (March 2018: 5.7%). Furthermore,
37% of FY2020 expiries have already been concluded at reversions in line with FY2019. A further 18% of space is currently under offer or in
advanced stages of negotiation.

The sector's cost to income ratio remains under pressure due to the weak tenant demand environment resulting in longer void periods.
Although costs are well controlled and have only increased by 3.5% (excluding rates expense), the cost to income ratio has increased to
15.1% (March 2018: 14.0%) due to lower revenue growth. This ratio is expected to remain at similar levels until the macro-economic conditions
improve and allow for rental growth. The cost base has also been impacted by bad debts given the pressure on local businesses.

The overall arrears position is largely attributable to a single client that has recently gone into voluntary business rescue. The Fund is working
closely with the client to assist with the turnaround of the business in order to recover the Fund's arrears.

Retail
The retail portfolio is robust and defensive and is the best performing sector within the Fund. The sector has performed well despite the lack of
economic growth. This has been achieved through a focused strategy of maintaining a significant proportion of national clients (currently 81%)
to ensure the assets are able to trade through periods of subdued consumer spending.

The retail sector has displayed defensive characteristics through a very challenging market with centre turnover growth being reported at
2.7% on the total portfolio at the end of March 2019.This has reflected an upward trend since a low of 1.9% in March 2018. Excluding Design
Quarter (planned refurbishment) and Balfour (severely impacted by the Rea Vaya road works), year-on-year turnover growth reflected 4.1% in
March 2019.

The Fund's retail base portfolio reported NPI growth of 5.6% which is testament to the quality of the underlying portfolio. The net cost to
income ratio has increased only marginally from 18.2% to 18.5%, supported by the tightly controlled fixed costs which only increased by 1.1%.

Leasing activity during the period has been very positive with 99% (57 619m(2)) of space expiring during the full year renewed and re-let and a
further 23% (3 061 m(2)) of opening vacancy let. Average reversions of positive 2.6% and in-force escalations of 7.1% were achieved on this
letting. Excluding strategic development vacancies at Design Quarter and Devland Silverlakes, the sector's vacancy remains extremely low at
1.0% (March 2018: 1.2%). Including the strategic development vacancies, this would increase to 2.6% (March 2018: 3.3%).

The Fund will be participating in the Edcon restructure and has opted to receive reduced rental income over the next two years, commencing
on 1 May 2019. On a portfolio basis, exposure to the Edcon Group represents less than 2% of the Fund's revenue. It is anticipated that the
reduction in rental income will amount to R9.8 million per annum, from FY2020. There was no impact for the year ended 31 March 2019.

The Fund has purchased the Highlands Mall, a strategically located strip mall on the corner of Louis Botha Avenue and Athol Street in Highlands
North. This acquisition provides an exciting opportunity for the Fund to significantly strengthen the Balfour Mall precinct. The intention is to
create a space in which the target market is able to 'live, socialise and play' in a safe and secure environment while providing a solution for
middle income earners to live and work within close proximity.

Trade receivables
The total arrears as a percentage of collectables has reduced to 2.9% from 3.1% (March 2018). This ratio includes clients that are subject to
legal proceedings (if excluded, the ratio is 1.4%, March 2018: 1.1%). If Edcon arrears are excluded the arrears percentage reduces to 2.8%
(and 1.3% excluding legal tenants) in the current year.

Total geographic spread

South Africa       85%     
UK                  1%     
Europe              8%     
Austrailia          6%     

SA sectorial spread

Office             36%
Industrial         22%    
Retail             42%


Local investments

Ingenuity
The Fund announced on 17 April 2019 that Ingenuity will seek shareholder approval to repurchase all the shares held by IPF for R1.08 per
share. The sale is expected to be completed by July 2019. If approved, this will reflect a 29% gain on the average purchase price of the
Ingenuity shares and an 8.2% increase on the value including the distribution add back of the notional capitalisation of interest. The Fund will
continue to add back the cost of the funding to the distribution until the date of sale.

The sale of the shares provides shareholders with clarity over the Fund's investment into Ingenuity and simplifies the distribution statement
going forward.

Izandla
The Fund invested a further R115.6 million into Izandla (R15.0 million equity, R6.9 million senior mezzanine loan, and R93.7 million convertible
shareholder loan) to support the acquisition of a property in Hatfield and the development of a logistics facility for Sasol on the back of a 
15 year lease. Izandla is currently raising equity to fund an identified pipeline and IPF will look to convert some or all of the mezzanine debt into
equity at that point. The shareholder loan to Izandla to support the development of the Sasol facility, is also likely to be imminently refinanced
by external funds and/or the anticipated equity raising proceeds.

Offshore investments

Australia (listed)
The Fund's investment in IAPF amounts to R1.3 billion, representing 20.9% of IAPF (March 2018: 20.9%). The increase in the IAPF share price
to R12.70 reflects a 21% increase from March 2018 and positively contributed to the NAV growth of the Fund for the year. In AUD and on a
post WHT basis, IAPF delivered distribution growth of 1.2% which resulted in growth of 4% in ZAR.

The Fund continues to employ a conservative approach to hedging of both the income and capital risk of the investment. The Fund increased
its AUD cross-currency swap ('CCS') exposure post year-end by AUD10 million, to maintain 50% of the value of the investment hedged by way
of CCS's. In terms of income, the Fund has hedged 100% of its anticipated distributions over a five year period at a range of between
R11.02 and R13.85. The Fund manages this position on an ongoing basis.

As announced on 3 May 2019, IAPF intends to list on the ASX. In conjunction with the listing, IAPF is seeking to raise approximately AUD100
million mainly from the Australian capital markets. The final subscription price is expected to be within the indicative price range of AUD1.30 to
AUD1.35 per unit. The proceeds from the offer will be used by IAPF to repay debt and pay the costs associated with the offer. The Fund has
agreed to make available up to 45 million IAPF units at the final subscription price determined under the institutional bookbuild for the purposes
of satisfying oversubscriptions from certain institutional investors. If the offer is not oversubscribed, no IAPF units will be transferred under
the sale. The transfer of any IAPF units under the sale is expected to occur around the date that new IAPF units are allotted under the offer.

IAPF remains a key investment for the Fund and should all the units made available under the sale be transferred, the Fund would still retain
a c.10% investment in IAPF. The proceeds of the sale will be utilised to further de-lever the Fund's balance sheet and/or be recycled into the
Pan-European strategy.

As a result of the listing, IAPF has informed unitholders that they will be adjusting their distribution pay-out ratios to align with other ASX listed
REITs and best practice in Australia. The Fund is supportive of this change as it does not impact the total return to investors as the reduced
distribution will increase NAV. This change also enhances IAPF's ability to secure Australian capital further enhancing their ability to support
future growth. IAPF's change in distribution policy will impact the Fund's FY2020 distribution growth by c. 1% (on the assumption that the full
45 million units made available under the sale are sold). This has been taken into account in the provision of the guidance referred to in this
announcement.

United Kingdom (unlisted)
The Fund's investment into the U.K. Fund remains small, with its 10% shareholding amounting to R222.5 million (GBP 10.6 million cost). The
investment provides optionality to the Fund should an opportunity exist to increase its exposure to the U.K. real estate market.

The U.K. Fund delivered an income return of 5.4% and NAV growth of 10.4% resulting from several asset management initiatives, including:

- The regearing of the Sainsbury's, Swansea lease to 30 years;
- The sale of the Sainsbury's, Worcester property at a 14.7% premium to book value;
- The repositioning and tenanting of the Edmonton, North London industrial facility; and
- Upward rental reversions of 22% being achieved across 1 282m(2) of industrial space that was renewed or relet during the year.

41% of the value of the investment is hedged by way of CCS's. The Fund has hedged 100% of its distributions over a five-year period at a
range of between R19.42 and R25.57.

Pan-European logistics portfolio (unlisted)
During the year the Fund acquired a 42.9% interest in a Pan-European logistics platform and committed to investing up to EUR150 million into the
platform over the next four years. Including the Fund's commitment, a total of EUR350 million has been committed to the platform. The investment
will assist in the timely aggregation of a scaled and diversified logistics portfolio across Europe and once the equity has been fully deployed,
will result in a logistics platform of c. EUR900 million.

                                                                  IPF equity                                                                            
                                                                  investment                                                     GLA         Property   
Pan-European logistics portfolio                                     (EUR'm)                  Date               Country      (m(2))    value (EUR'm)   
                                                                                                        France, Germany,                                
                                                                                                          Italy, Poland,                                
                                                                                                            Netherlands,                                
Initial portfolio                                                       65.8              May 2018                 Spain     975 165            423.0   
Acquisitions                                                            10.1                                                                            
Combs-la-Ville                                                           1.8        September 2018                France      22 966             11.5   
Elbeuf                                                                   0.8        September 2018                France       9 649              5.1   
Dortmund                                                                 3.4         February 2019               Germany      25 783             15.8   
Monchengladbach                                                          4.1         February 2019               Germany      10 618             19.4   
Invested at 31 March 2019(1)                                            75.9                                                                            
Acquisitions and commitments post                                                                                                                       
year-end                                                                26.7                                                                            
Schipol                                                                  2.1            April 2019           Netherlands      17 557             23.2   
Bergen                                                                   3.1            April 2019           Netherlands      20 957             16.7   
Venlo                                                                    3.2            April 2019           Netherlands      25 704             18.1   
Marseille                                                                9.2            April 2019                France      65 354             51.6   
VRE                                                                      5.3           May 2019(2)                Poland      51 595             30.0   
Warsaw                                                                   1.3           May 2019(2)                Poland      11 109              7.3   
Tiel                                                                     1.2           May 2019(2)           Netherlands       9 900              7.1   
Triad: Hanover                                                           1.3           May 2019(2)               Germany      24 551             13.4   
Total deployed/committed                                               102.6                                                                            
Total commitment                                                       150.0                                                                            
Remaining commitment                                                    47.4                                                                            

(1)   Excludes bridge funding of EUR9.0 million provided.
(2)   Anticipated date of transfer.

The initial portfolio of 22 logistics properties with an asset value of EUR423 million was acquired by the platform in May 2018 with IPF contributing
EUR65.9 million of initial equity (excluding transaction costs). This seed portfolio was acquired on an unlevered net initial yield of 6.0%, generating
an initial investment yield of approximately 10.5%. The portfolio has generated returns of 11.6% in Euros and 11.9% in ZAR, with the
outperformance driven by strong leasing activity, shorter void periods and lower incentives. The underlying properties were externally revalued twice
during the year and saw an uplift of 12.5% which translated into a capital uplift for IPF in Euros of 14.4% (ZAR 16.3%), further supporting the
investment rationale into this platform.

Subsequent to the Fund's initial investment, the Fund invested a further EUR10.1 million to support the acquisition of four further properties across
the Netherlands and Germany during the second half of the year (with one French asset sold). The acquisitions are expected to deliver a similar
investment return to the initial portfolio.

Metrics                                                                                                             March 2019         At acquisition   
Income return p.a. (EUR)                                                                                                 11.6%                  10.5%   
WALE (years)                                                                                                               4.5                    3.2   
Vacancy                                                                                                                   5.1%                  10.1%   
Number of properties                                                                                                        25                     22   


53% of the value of the investment is hedged by CCS's and Euro denominated loans (weighted average debt and swap expiry of 2.8 years which was extended
past year-end.). The Fund has hedged 100% of its contracted distributions over a five-year period at a range of between R15.39 and R20.60.

Pan-European light industrial portfolio (unlisted)
Post year-end, the Fund announced that it had concluded agreements to acquire an initial investment into a PELI portfolio. As part of this
agreement the Fund will acquire an initial 25% in a platform that will focus on investments across the Northern corridor of Western Europe,
with specific focus on France, Germany and the Netherlands.

Similar to IPF's current investment in its Pan-European logistics platform, the Fund will invest alongside the same funds and segregated
mandates managed by Ares Management and the in-country asset management will be executed by Urban Real Estate Partners ('UREP') -
the team that has successfully executed the initial strategy of the logistics platform.

The portfolio is expected to comprise 21 primarily light industrial properties, of which 4 assets located in the Netherlands have already been
acquired. A further 17 properties located across France and Germany have been identified and is in advanced negotiations with the vendors thereof with 
a view to concluding these acquisitions by the end of May 2019. The gross asset value attributable to the initial portfolio will be EUR116 million
and the Fund's initial equity contribution will be EUR10.2 million. The portfolio will be 90% let with an initial asset yield of 7.2% which is expected
to grow to a fully let ERV yield of 8.2%, and is expected to have an aggregate GLA of 151 401m(2) and a WAULT of 3.3 years with weighted
average annual rental income of EUR5.4/m(2).

Whilst this core light industrial property investment strategy is premised on a similar macroeconomic theme to the logistics platform, it will be
based on the following more unique principles:

- focus on the Northern corridor of Western Europe, with liquid and transparent property markets;
- micro-location - target assets within close proximity/last mile to cities with high concentrations of industry and consumers, as well as
  limited land availability;
- high quality assets and strong property fundamentals - assets below 20 years of age which provide maximum occupational flexibility for
  storage, distribution and general warehousing and expansion potential;
- target assets with pricing that reflects a discount to replacement cost and/or offer active asset management opportunities requiring
  specialist management skills which UREP possesses through the experience of the management team gained during their time at
  Hansteen Holdings Plc. Paul Rodgers headed up the Hansteen European property portfolio and successfully facilitated the sale of their
  Dutch and German assets to Blackstone for EUR1.3 billion;
- target building size typically less than 10 000m(2) whereas logistics platform targets larger unit sizes;
- robust cash flows - target cash yielding assets with good occupancy history that offer potential for attractive cash on cash yields;
- diversified multi-let tenant base ranging from large national through to small and SME tenants which provides diversification of underlying
  cash flows; and
- the ability to upwardly manage rentals given supply/demand dynamics and in-country asset management experience.

Once leveraged at a holding company level, the investment is anticipated to deliver an average Euro-denominated investment return of
approximately 9.6% to the Fund and total returns that significantly exceed the Fund's cost of capital.

Inclusive of the initial investment, IPF has committed a total of EUR64.5 million into this light industrial platform which is expected to be deployed
within the next two years, with each subsequent investment increasing IPF's equity interest in the platform. The portfolio's gross asset value
will amount to between EUR375 million-EUR500 million, dependent on the level of gearing utilised at a property level.

The transaction is complementary to the Fund's existing investment into the Pan-European logistics platform and further enhances the Fund's
presence in a very strong segment of the real estate market across Europe. The strategy will look to benefit from growth of e-commerce
across Europe and its expected impact on last mile logistics. Furthermore, the transaction is consistent with the Fund's investment strategy of
continuously assessing real estate opportunities in various geographies with an attractive risk-adjusted return profile and recycling capital into
investments that maximise long-term returns.

The initial investment will be funded through a combination of existing ZAR debt facilities and either Euro debt facilities or CCS's. The blended
funding cost is anticipated to be approximately 5%.

The Fund will hedge out all the income from the initial investment that is not naturally hedged by way of Euro funding by entering into FEC's
over a period of three to five years. It is anticipated that these FEC's will provide the Fund with between 6% to 7% embedded growth on the
hedged income over the hedged period.

Balance sheet and risk management                                                                  
Balance sheet and risk management remains a fundamental focus area for the Fund.                   
                                                                                                                           March                March   
                                                                                                                           2019*                 2018   
Average all in cost of funding(1)                                                                                          7.90%                8.60%   
Average debt margin - ZAR(2)                                                                                               1.67%                1.64%   
Average swap rate - ZAR                                                                                                    7.57%                7.56%   
Average all in fixed rate - AUD                                                                                            4.61%                4.71%   
Average all in fixed rate - GBP                                                                                            2.36%                2.32%   
Average all in fixed rate - EUR (incl. CCS)                                                                                1.99%                  n/a   
Debt maturity (years)                                                                                                        3.5                  2.7   
Swap maturity (years)                                                                                                        3.4                  3.8   
Hedge percentage                                                                                                           84.0%                84.0%   
Gearing(3)                                                                                                                 35.9%                32.6%   
Encumbrance ratio(4)                                                                                                       26.9%                33.5%   
% debt secured(5)                                                                                                          33.7%                34.6%   
% CCS of AUD investment                                                                                                    50.0%                51.0%   
% CCS of GBP investment                                                                                                    41.0%                50.0%   
% Foreign debt and CCS of EUR investment                                                                                   53.0%                  n/a   
Sources of funding                                                                                                                                      
DMTN                                                                                                                         45%                  42%   
Commercial Paper                                                                                                              6%                   4%   
Bank                                                                                                                          8%                  54%   
Foreign                                                                                                                      13%                    -   
HQLA                                                                                                                         28%                    -   

(1)   Reduced as a result of Euro debt introduced in FY2019.
(2)   Increase due to debt refinancing.
(3)   Gearing shown net of cash.
(4)   Secured assets as a percentage of total investments - reduced due to repayment of R0.7 billion bank debt post year end.
(5)   Secured debt as a percentage of total debt facilities - reduced due to debt refinancing.
 *    Metrics include post year end debt and swap movements.

Balance sheet and treasury management remains a fundamental focus area and the Fund continues to adopt a conservative approach to its
balance sheet position. Maintaining long-term certainty of cost and access to adequate liquidity is of paramount importance in the current
environment.

The Fund's gearing ratio is 35.9% at 31 March 2019 (31 March 2018: 32.6%), increasing as a result of the capital deployment into Europe. The
Fund's targeted gearing ratio is below 35% and can be achieved through active capital recycling, where necessary.

There is a continued drive to fund long-term assets with long-term borrowings and to conservatively manage refinancing and credit risk.
This is achieved through maintaining a diversified funding portfolio with the banks and capital markets and early engagement with lenders as
far as possible. The following factors are considered in all debt raising decisions including, but not limited to, margin, flexibility, security and
committed revolving facilities.

During the year, the Fund completed a R3.7 billion bank refinancing, significantly reducing refinance risk by refinancing all bank debt maturing
within the next two years and opportunistically refinancing some longer term debt on more attractive terms in the capital markets. The
combined refinancing has extended the Fund's weighted average debt expiry to 3.5 years from 2.7 years at March 2018 and reduced the
Fund's encumbrance ratio to 26.9% (March 2018: 33.5%). This provides significant flexibility in terms of future funding initiatives. The reduction
in encumbrance ratio was due to active debt management, release of mortgaged properties where possible and the early refinance of
R700 million of secured debt (included in the R3.7 billion refinancing). This has also reduced the level of secured debt to 33.7% (March 2018:
34.6%), further strengthening the balance sheet.

IPF currently has R1.8 billion of available undrawn bank and cash facilities. R1.1 billion of the bank facilities are committed and provide the
Fund with adequate liquidity to alleviate any refinancing risks over the next 12 months.

The Fund's weighted average cost of funding reduced to 7.9% (March 2018: 8.6%) as a result of the Euro debt introduced to fund the Pan-
European investment. On a like-for-like basis, this would have remained at similar levels reported at 31 March 2018.

The Fund is active in its treasury management and maintains a focused strategy of attaining the lowest rate for the longest tenor. Post balance
sheet date the Fund took advantage of a more favourable interest rate curve and restructured over R1 billion of interest rate swaps thereby
extending the total swap profile by eight months at no additional cost to the Fund. The Fund also entered into an additional AUD10 million of
CCS's, in order to maintain a 50% hedge on the capital invested into Australia and took advantage of lower AUD fixed rates reducing AUD
funding to 4.6% (March 2018 4.7%).

Including cross currency interest rate swaps ('CCIRS'), the Fund's interest rate exposure is 84% hedged at 31 March 2019 (March 2018: 84%)
with a weighted average term of 3.4 years (March 2018: 3.8 years).

The conservative balance sheet strategy and active management has resulted in the Fund's ability to maintain strong credit metrics and its
corporate rating was upgraded to A+(ZA) from A(ZA) in August 2018.

Capital allocation

Capital allocation is a fundamental focus of the business, and capital is allocated for the best return to shareholders.

                                                                                                                             March              March   
Rm                                                                                                                            2019               2018   
Deployment funded by:                                                                                                                                   
Proceeds from SA property disposals                                                                                          500.5              672.4   
Equity                                                                                                                        81.1              207.3   
Debt raised/(repaid)                                                                                                       1 108.4            (138.8)   
                                                                                                                           1 690.0              740.9   
Deployment into:                                                                                                                                        
PEL platform                                                                                                             (1 380.9)                  -   
Izandla                                                                                                                    (115.6)            (188.9)   
UK Fund                                                                                                                     (11.5)            (173.3)   
Ingenuity                                                                                                                        -             (20.7)   
SA property portfolio projects and capital expenditure (prior year includes acquisitions)                                  (182.0)            (358.0)   
                                                                                                                         (1 690.0)            (740.9)   


The proceeds from disposals arose from the sale of four buildings in the South African portfolio at a blended yield of 7.1% and were
re-deployed into the PEL platform generating an income return of 11.9%. A further 12 properties have been earmarked for sale with expected
proceeds of approximately R0.6 billion and proceeds from the partial sale of the investment in IAPF is expected to generate a further R0.6 billion.
This will be efficiently recycled on an earnings enhancing basis and/or used to reduce gearing.

The twelve properties held for sale include:                                                 
                                                                                                                          GLA          Carrying Value   
                                                                                                      Grade              m(2)                      Rm   
Industrial                                                                                                                                              
Beechwood House                                                                                   High-Tech             5 677                    37.0   
British American Tobacco                                                                        Warehousing            13 417                    80.0   
Capital Motors (McCarthy Pretoria)                                                              Warehousing             7 011                    23.1   
Scientific Building                                                                               High-Tech             5 733                    35.0   
Office                                                                                                                                                  
International SOS                                                                                         B             3 604                    13.0   
Retail                                                                                                                                                  
Boxer Cofimvaba                                                                            Retail warehouse             1 045                     6.9   
Builders Warehouse Polokwane                                                               Retail warehouse             8 829                   101.5   
Builders Warehouse Witbank                                                                 Retail warehouse             5 512                    85.0   
Devland Oudtshoorn                                                                         Retail warehouse             2 742                     8.0   
Masscash Kimberley                                                                         Retail warehouse             5 850                    34.2   
Nonkqubela                                                                                Local convenience             2 939                    20.0   
Nonquebela Link Mall                                                                          Neighbourhood             7 836                   140.0   
Total                                                                                                                  70 195                   583.7   


Capital expenditure
During the year, the Fund spent R182.0 million on capital projects, refurbishments and maintenance capex. This includes R46.1 million on
sustainability projects which generated an average return of 14%. Project spend included R74.7 million on the Fleurdal Mall extension, Design
Quarter refurbishment and Firs refresh. The Firs and Fleurdal projects are near completion whilst the Design Quarter project is in the final stages
of its Stage 2 feasibility.

Of the R46.1 million spent on sustainability in the current year, R43.2 million was spent on solar PV projects. Earmarked spend for FY2020 is
R90.8 million of which 90% is return generating.

The Fund has committed to capital expenditure relating to redevelopment and refurbishment projects (R156.0 million), the purchase of a shopping centre 
(R51.0 million) and sustainability projects (R28.2 million). 

Dividend re-investment programme
The board is considering offering a dividend re-investment alternative in which a shareholder would be entitled to elect to re-invest the cash
dividend in return for IPF shares, failing which they will receive the cash dividend in respect of all or part of their shareholdings. A further
announcement will be made in this regard on or before 28 May 2019.

Financial assistance
Shareholders are advised that at the annual general meeting of the Fund held on 20 August 2018, shareholders approved and passed a
special resolution in terms of Section 45 of the Companies Act No 71 of 2008, as amended ('the Act') authorising the Fund to provide financial
assistance to among others, related or inter-related companies of the Fund.

Investec Property Fund Limited ('the Company') provided financial assistance to its subsidiary IPFO, which was created in order to hold the
Fund's offshore investments.

Shareholders are hereby notified that in terms of S45(5)(b) of the Companies Act No 71 of 2008, as amended, the board of directors of the
Company authorised the issue of guarantees and suretyships to third parties for finance and other facilities granted by those third parties to
wholly-owned subsidiaries of the Company during the period 1 April 2018 to 31 March 2019.

The board has confirmed that, after considering the reasonable foreseeable financial circumstances of the Company, it is satisfied that
immediately after providing such financial assistance, the Company would satisfy the solvency and liquidity test, as contemplated in terms of
Section 4 of the Act, and that the terms under which such financial assistance was given were fair and reasonable to the Company.

Shareholding
At 31 March 2019, Investec Group, Coronation Fund Managers, Public Investment Corporation, STANLIB Asset Management and Investec
Asset Management are the only shareholders holding in excess of 5% of the Fund's total shares in issue.

                                                                                                      Shareholding       Shareholding                  
                                                                                                       at 31 March        at 31 March                  
Rank   Beneficial shareholder                                                                                 2019               2018         Change   
1      Investec Group*                                                                                       26.6%              26.8%          (0.2)   
2      Coronation Fund Managers                                                                              10.3%              16.4%          (6.1)   
3      Investec Asset Management                                                                              7.6%               5.4%            2.2   
4      Government Employees Pension Fund                                                                      6.4%               6.4%              -   
5      STANLIB Asset Management                                                                               3.6%               5.9%          (2.3)   

*  Includes Investec Limited and Investec Bank Limited.

Prospects and guidance
As communicated in the trading update, the short-term outlook in South Africa remains challenging and is expected to impact the performance
of the Fund's South African portfolio in the short-term. The impact of the Edcon restructure will further adversely affect the earnings base in the
next 12 months with the Fund anticipating a c. 1% impact on distribution as a result of the restructuring. Taking this all into account, the Fund
expects the South African portfolio to deliver NPI growth similar to FY2019 during the forthcoming year.

The Pan-European logistics platform is expected to continue to provide earnings accretion to the Fund during the year ending 31 March 2020,
with earnings further supported by the accretive nature of the recently announced Pan-European light industrial investment. Additional capital
deployment into both platforms and continued successful execution of the underlying strategy in terms of leasing and asset management
provides further opportunity for earnings growth.

The partial sale of the Fund's investment in IAPF and subsequent redeployment into the Fund's two European platforms are evidence of
efficient capital recycling. If successful, earnings should be further enhanced although this may be offset by the reduction in the Fund's earnings
from its remaining stake in IAPF resulting from its change in distribution policy.

Taking the above into account, the Fund expects to deliver dividend growth per share for the financial year ending 31 March 2020 of between
3% and 5%, with the upper end of the range dependent on the level of capital deployed into European pipeline opportunities during the year.

In providing this guidance, the Fund has assumed no material change to the operating environment and that no material tenant failures take
place.

This forecast has not been reviewed or audited on by the Fund's independent external auditor.

On behalf of the Board of Investec Property Fund Limited

Sam Hackner                                                                   Andrew Wooler and Darryl Mayers
Non-executive Chairman                                                        Joint Chief executive officers

13 May 2019

Basis of accounting
The reviewed preliminary condensed consolidated financial information for the year ended 31 March 2019 has been prepared in compliance
with International Financial Reporting Standards ('IFRS'), the presentation and disclosure requirements of IAS 34, Interim Financial Reporting,
the SAICA Financial Reporting Guide as issued by the Accounting Practices Committee and Financial Reporting Pronouncements as issued
by The Financial Reporting Standards Council, the Companies Act No. 71 of 2008, as amended of South Africa and the JSE Listings
Requirements.

The accounting policies applied in the preparation of the results for the year ended 31 March 2019 are consistent with those adopted in
the financial statements for the year ended 31 March 2018, other than the adoption of those standards that became effective in the current
period, including IFRS 9 ('Financial Assets and Financial Liabilities') and IFRS 15 ('Revenue for Contracts with Customers'), which had no
material impact on the financial results. These reviewed preliminary condensed consolidated financial statements have been prepared under
the supervision of Jenna Sprenger CA(SA).

Review conclusion
Ernst & Young Inc., the Fund's independent auditor, have reviewed the consolidated statement of comprehensive income, consolidated
statement of financial position, consolidated statement of cash flows, consolidated statement of changes in equity, consolidated segmental
information and notes to the condensed consolidated financial results, as set out on pages 2 to 14 of the preliminary condensed consolidated
financial results, and have expressed an unmodified review conclusion. A copy of their review conclusion is available for inspection at the
company's registered office.

Final dividend
Notice is hereby given of the declaration of final dividend number 17 ('Cash dividend') of 73.50878 cents per share for the period 1 October
2018 to 31 March 2019.

Other information:
- The dividend has been declared from income reserves.
- A dividend withholding tax of 20% will be applicable on the dividend portion to all shareholders who are not exempt.
- The issued share capital at the declaration date is 736 290 993 ordinary shares of no par value.

In accordance with Investec Property Fund's status as a REIT, shareholders are advised that the dividend meets the requirements of a
'qualifying distribution' for the purposes of section 25BB of the Income Tax Act, No. 58 of 1962 ('Income Tax Act'). The dividends on the shares
will be deemed to be dividends for South African tax purposes in terms of section 25BB of the Income Tax Act.

Tax implications for South African resident shareholders
Dividends received by or accrued to South African tax residents must be included in the gross income of such shareholders and will not be
exempt from income tax in terms of the exclusion to the general dividend exemption contained in section 10(1)(k)(i)(aa) of the Income Tax Act
because they are dividends distributed by a REIT. These dividends are however exempt from dividend withholding tax ('Dividend Tax') in the
hands of South African resident shareholders provided that the South African resident shareholders have provided to the CSDP or broker, as
the case may be, in respect of uncertificated Shares, or the Fund, in respect of certificated Shares, a declaration by the beneficial owner (in
such form as may be prescribed by the Commissioner) that the dividend is exempt from dividends tax in terms of section 64F and a written
undertaking (in such form as may be prescribed by the Commissioner) to forthwith inform the CSDP, broker or the Fund, as the case may be,
should the circumstances affecting the exemption change or if the beneficial owner ceases to be the beneficial owner.

If resident shareholders have not submitted the abovementioned documentation to confirm their status as South African residents, they are
advised to contact their CSDP, or broker, as the case may be, to arrange for the documents to be submitted prior to the date determined by
the regulated intermediary, or if no date is determined, by the date of payment of the dividend.

Tax implications for non-resident shareholders
Dividends received by non-resident shareholders from a REIT will not be taxable in South Africa as income and instead will be treated as
ordinary dividends which are exempt from income tax in terms of the general dividend exemption in section 10(1)(k)(i) of the Income Tax Act. It
should be noted that up to 31 December 2013 dividends received by non-residents from a REIT were not subject to Dividend Tax. With effect
from 22 February 2017, any dividend received by a non-resident from a REIT are subject to Dividend Tax at 20%, unless the rate is reduced
in terms of any applicable agreement for the avoidance of double taxation ('DTA') between South Africa and the country of residence of the
non-resident shareholder. Assuming Dividend Tax will be withheld at a rate of 20%, the net dividend amount due to non-resident shareholders
is 58.80702 cents per share. A reduced dividend withholding rate in terms of the applicable DTA may only be relied on if the non-resident
shareholder has provided the following forms to their CSDP or broker, as the case may be, in respect of uncertificated shares, or the Fund, in
respect of certificated shares:

- A declaration by the beneficial owner (in such form as may be prescribed by the Commissioner) that the dividend is subject to a reduced
  rate as a result of the application of the DTA; and
- A written undertaking (in such form as may be prescribed by the Commissioner) to forthwith inform, the CSDP, broker or the Fund, as the
  case may be, should the circumstances affecting the reduced rate change or if the beneficial owner ceases to be the beneficial owner.

If applicable, non-resident Shareholders are advised to contact the CSDP, broker or the Fund, as the case may be, to arrange for the
abovementioned documents to be submitted prior to the date determined by the regulated intermediary, or if no date is determined, by the
date of payment of the dividend, if such documents have not already been submitted.

Other information:

- As at the date of this circular, the ordinary issued share capital of Investec Property Fund is 736 290 993 ordinary Shares of no par value
  before any election to reinvest the cash dividend
- Income Tax Reference Number of Investec Property Fund: 9332/719/16/1
- Shareholders are encouraged to consult their professional advisors should they be in any doubt as to the appropriate action to take.

 Summary of the salient dates relating to the Cash Dividend:                                                                                     2019

Declaration of dividend                                                                                                               Tuesday, 14 May
Circular and form of election posted to shareholders and announced on SENS                                                            Tuesday, 28 May
Last day to withdraw the Share Re-Investment Alternative                                                                               Monday, 3 June
Announcement of Share Re-Investment Alternative issue price and finalisation information ('Finalisation Date')                        Tuesday, 4 June
Last day to trade in order to participate in the election to receive shares in terms of the Share 
Re-Investment Alternative or to receive a cash dividend ("LDT")                                                                      Tuesday, 11 June
Shares trade ex-dividend                                                                                                           Wednesday, 12 June
Listing of maximum possible number of Share Re-Investment Alternative shares commences on the JSE                                     Friday, 14 June
Last day to elect to receive the Share re-Investment Alternative at 12:00                                                             Friday, 14 June
Record date for shareholders to receive dividend                                                                                      Friday, 14 June
Announcement of results of Cash Dividend and Share Re-Investment Alternative on SENS                                                 Tuesday, 18 June
For shareholders elective the Cash Distribution cheques posted to Certificated Shareholders and accounts
credited by CSDP or broker to Dematerialised Shareholders electing the Cash Dividend on or about                                     Tuesday, 18 June
Share certificates posted to Certificated Shareholders and accounts credited by CSDP or broker to
Dematerialised Shareholders electing to Share Re-Investment Alternative on                                                          Thursday, 20 June
Adjustment to the maximum number of shares listed on or about                                                                         Friday, 21 June

Notes:
1. Shares may not be dematerialised or rematerialised between commencement of trade on Wednesday, 12 June 2019 and close of trade on 
   Friday, 14 June 2019.
2. The above dates and times are subject to change. Any changes will be released on SENS.

Investec Bank Limited
Company Secretary

13 May 2019

COMPANY INFORMATION

Directors
S Hackner (Chairman)#
SR Leon (Deputy Chairman)#
A Wooler (Joint Chief executive officer)
DJ Mayers (Joint Chief executive officer)
JC Sprenger (Chief financial officer)
N Riley#
LLM Giuricich#
S Mahomed#*
CN Mashaba#*
MM Ngoasheng#*
KL Shuenyane#*
P Hourquebie#*

# Non-executive
* Independent

Registered office
C/o Company Secretarial, Investec Limited
100 Grayston Drive, Sandown, Sandton, 2196

Transfer secretary
Computershare Investor Services Proprietary Limited
(Registration number 2004/003647/07)
Rosebank Towers, 15 Biermann Avenue
Rosebank, Johannesburg, 2196

Sponsor
Investec Bank Limited
100 Grayston Drive, Sandown, Sandton, 2196



Date: 14/05/2019 08:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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