South African company eyeing investment opportunities in Lagos

South African real estate company Pivotal Property Fund is focusing on growing its exposure in Nigeria to consolidate on it joining the ranks of the JSE, back in December.

The company announced on Wednesday that it plans to acquire a 37.1% stake in an office block development in Lagos, Nigeria, valued at $104 million. This partnership will be with multinational energy group Oando and real estate company RMB Westport.

Pivotal says the property will be moved to Mara Diversified Property Holdings (Maradph), a fund that is still in its formative stages, which will have a primary listing in Mauritius. The fund will also be listed on the JSE’s AltX.

On the acquisition, the company’s CEO Jackie Van Niekerk says the deal is opportunistic, “as we are getting into prime real estate on Victoria Island. It ticks all the boxes for Pivotal”.

Pivotal will initially own 100$ of Maradph, but it plans to open up the shareholding to other interested parties who will be able to subscribe for shares as the fund makes its debut on the local scene.

“The fund will be exposed to retail, office and also a big opportunity for a distribution centre. It is still early days to say where our niche is. We will not be all over East and West Africa,” Van Niekerk says.

She further says that part of the reasons why the company is expanding its portfolio outside South Africa is due to limited opportunities available in the local market, especially in the retail sector.

“We want to invest 15% of our gross asset value into Africa that is a board mandate. The 15% will be reviewed on an annual basis,” Van Niekerk adds.