TRANSCEND RESIDENTIAL PROPERTY FUND - The market leader in quality affordable housing in South Africa
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TRANSCEND
RESIDENTIAL
PROPERTY FUND
The market leader in quality
affordable housing
in South Africa
Investor presentation – November 2018
0
DISCLAIMER
This document has been compiled by Tenurey BSM Proprietary Limited (“Tenurey”) from information provided by the management of Transcend
Residential Property Fund Limited (“Transcend”) and from publicly available sources. Information contained herein involves elements of subjective
judgment and analysis which may or may not be correct and has not been independently verified.
While the information contained herein is believed to be accurate, Tenurey has not conducted any investigation with respect to such information. No
representation or warranty, express or implied is or will be given by Transcend or Tenurey or their respective directors, partners, employees or
advisors or any other person as to the accuracy, completeness or fairness of this document and, so far as permitted by law and except in the case
of fraud by the party concerned, no responsibility or liability whatsoever is accepted for the accuracy or sufficiency thereof or for any errors,
omissions or misstatements negligent or otherwise relating thereto.
Transcend shall only be bound by those particular representations and warranties set forth in definitive written transaction documents, when and if
such transaction documents are executed and subject to such restrictions and limitations as may be contained therein.
This document includes certain statements, estimates, targets, forecasts and projections provided by Transcend with respect to Transcend’s
anticipated future performance. Such statements, estimates, targets, forecasts and projections reflect significant assumptions and subjective
judgments and analysis by Transcend’s management concerning anticipated results which may or may not prove to be correct and there can be no
assurance that any estimates, targets, forecasts or projections are attainable or will be realised. Tenurey does not assume responsibility for
verifying any of such statements, targets, estimates, forecasts and projections. Nothing contained in this document is, or shall be relied upon as, a
promise or representation, whether as to the past or the future. Accordingly, neither Transcend nor Tenurey nor any of their respective directors,
partners, employees or advisors nor any other person, shall be liable for any direct, indirect or consequential loss or damage suffered by any
person as a result of relying on any statement in or omission from this document and any such liability is expressly disclaimed. In particular, but
without limitation, no representation or warranty is given as to the achievement or reasonableness of, and no reliance should be placed on, any
estimates, targets, forecasts or projections contained in this document (or otherwise provided by or on behalf of Transcend with respect to the
subject matter of this document). In all cases, addressees should conduct their own investigation and analysis of Transcend and the information
contained in this document.
This presentation and the documents provided with this presentation are confidential and may not be disclosed to any third party without the prior
written consent of Tenurey and Transcend.
TRANSCEND RESIDENTIAL PROPERTY FUND 1
PRESENTERS
Rob Wesselo Solly Mboweni Myles Kritzinger
Chief Executive Officer – Chief Operations Officer Chief Financial Officer
Transcend
Managing Director – IHS
TRANSCEND RESIDENTIAL PROPERTY FUND 2
PRESENTATION OUTLINE
Page
1. Executive summary 4
2. Transcend 7
2.1 Current group structure 8
2.2 Current portfolio overview 9
2.3 Current board of directors 10
2.4 Proposed board and management 11
2.5 Role of IHS 12
2.6 Investment case – why Transcend 14
3. Proposed Transactions 15
3.1 IHS Res 1 Transactions 16
3.2 Other Transactions 18
3.3 Funding and capital structure 19
4. Financials 20
4.1 Pro forma effects – DPS 21
4.2 Pro forma balance sheet 22
5. Conclusion 23
Annexures 26
I Transcend existing portfolio 27
II IHS Res 1 Properties, Protea Glen & Silverleaf 44
III Portfolio post Proposed Transactions 55
IV Transcend vs MSCI Residential Benchmark 57
V IHS and MMA (Hunt) 59
TRANSCEND RESIDENTIAL PROPERTY FUND 3
1. EXECUTIVE SUMMARY
Transcend at a glance (status quo) Current market metrics
Rmil
Closing share price (R) 5,60
• Listed on the Altx in December 2016 at R6.75 (21% Shares outstanding (mil) 73.6
discount to NAV) Market capitalisation 412,2
Listing • Intention to migrate to the Main Board (speciality Net interest bearing debt 509.3
REIT sector) post implementation of the Proposed Enterprise value 921,5
Transactions Investment property 1 252
• A residential REIT, focused on affordable housing Gearing (LTV) 42%
that is lifestyle enhancing and well located in high Net asset value (NAV) as at 30 June 2018 764.8
Profile growth urban areas NAV per share (R) 10,39
• Exposure to Gauteng, Mpumalanga* and the Interim DPS (Cents) 30.10
Western Cape Discount to NAV -46%
Forward yield 12,2%
• 14 properties comprising 2,532 units*
• 128,915m² GLA Share price since listing (R)
• Portfolio value of R1.25bn Volume traded since listing: 226,082 shares
Portfolio overview^
• Occupancy: 96%^ 8,00 Value traded since listing: R1,393,907
1,981 shares
• Avg gross rental per unit: R5,576
7,00 traded at R5.60
• 90% of portfolio comprising 2 bed, 1 bath units
6,00
• Transcend = 2nd largest residential focused listed
property fund, with high quality assets, safe and 5,00
secure lifestyle complexes and a focus on
Jun-17
Jun-18
Dec-16
Dec-17
Mar-17
Sep-17
Mar-18
Sep-18
greening
Investment case • Properties are +/- 5 years old
• Defensive asset class Geographic spread of properties
• Residential fund expertise through International
Housing Solutions’ (“IHS”) – a market leader in
residential real estate investment
• Access to a future R6.4bn asset pipeline consisting
Pipeline
of 9,900 units through IHS
*Includes Acacia Place (sale agreement signed in Sep 2018 to dispose of Acacia Place for R127.5mil) 4
^As at 1 Nov 2018. Occupancy includes Acacia Place with a 10% vacancy TRANSCEND RESIDENTIAL PROPERTY FUND 4
1. EXECUTIVE SUMMARY
Proposed Transactions and Capital Raise
• Res 1 Properties: 1,983 units spread across 7 properties from IHS Res 1 Fund for R1.21bn (9.76% yield and
13.4% discount to independent valuation);
• Protea Glen: 176 units from a wholly owned subsidiary of South Africa Workforce Housing Fund (“SAWHF”) for
Acquisitions R60mil (10.3% yield and 2.1% discount to independent valuation);
• Silver Leaf: 76 units for R44.5mil (9.6% yield); and
• Vanguard: 60 units for R33.3mil (9.8% yield) (transferred in Aug 2018)
• Total purchase consideration: ±R1.35bn at an average acquisition yield of 9.78%
• Purchase consideration (including transaction costs) funded by: debt of ±60% (R825mil) and equity of ±40%
Funded by
(R551mil)
• R6.29 per share (ex-div), c. R6.44 cum dividend (as at 1 Dec 2018)
Equity raise • Forward yield of 10.5% (post Proposed Transactions)
• Discount to NAV of 31% (post Proposed Transactions)
• Emira Property Fund: up to R337mil of equity (max 34.9% shareholding and a min 25.1% shareholding) and a SH
Pre-commitments and
loan facility of R105mil
underwrite • MMA Capital Management (“MMA”): Underwrite of R105mil
• SAWHF: 38.4% (intention is for SAWHF to dilute over time, as Transcend pipeline is executed)
Shareholding post
• Emira: 25.1% (minimum)
Proposed Transactions • Public: 36.5%^ (assuming no underwrite take-up)
• Investors meetings (12 – 21 Nov)
• Site visit (22 Nov)
Timing • Final CPs (expected to be received by 30 Nov)
• Equity commitments (by 30 Nov)
• Effective date – targeting 1 Dec and issue of new shares – 1st week of Dec
^Includes SA Corporate Real Estate Limited (4.3%), who has communicated that they will dispose of their stake as part of the new equity raise or post the Proposed Transactions
5
TRANSCEND RESIDENTIAL PROPERTY FUND 5
1. EXECUTIVE SUMMARY
Rationale of Proposed Transactions
✓ Ability to secure portfolio at deep discount to fair value, despite scarcity value of large residential portfolios
✓ Lifestyle enhancing properties in well located, high growth urban areas
✓ Stable income stream at an attractive yield
✓ Highly sought after properties of superior quality to comparable portfolios in the market
✓ Favourable arrangement with IHS provides ability to access significant future pipeline
✓ Benefits of institutional knowledge of assets, which also ensures efficient handover
✓ Adds critical scale providing portfolio efficiency benefits
✓ Facilitates increased free float, liquidity and Main Board migration
Snapshot of Transcend post the Proposed Transactions
81% Gauteng,
Market Cap 31% discount 10.5% forward
22 properties 254,201m2 GLA 19% Western yield
R970m to NAV
Cape*
Portfolio value R6,406 avg 9,900 units
LTV of
of 4,442 units 5.99% vacancy gross monthly (R6.4bn)
46.0%
R2.63bn rental / unit^ pipeline
6
*Based on value
^ For forecast period of FY2019
TRANSCEND RESIDENTIAL PROPERTY FUND 6
2. TRANSCEND
TRANSCEND RESIDENTIAL PROPERTY FUND 7
2.1 CURRENT GROUP STRUCTURE
IHS Property SA Workforce IHS Asset
Management Other SA Corporate Emira Housing Management
(“IHSPM”)3 Fund SA 1 (“Manco”)
100%
0.9% 9.0% 9.9% 80.2% SAWHF PVE
(“SAWHF”)
Property Management Asset Management
Agreement Agreement
• Fee: annual asset management fee of 0.50% of
• Avg collection fee of 6.5% (+ VAT)
company EV (+ VAT)
• 3 month’s notice to cancel
• Term: 10 years from Dec 2016 and option for
100% ownership of 14 Transcend to renew for further 5 years (every 5 years)
properties1 • Option: Transcend has option to purchase equity or
business of Manco at fair value (to be negotiated)
once market cap reaches R4bn
Acacia 67 on 7th Alpine Ekhaya Ekhaya Jackalberry Kensington Molware Village Terenure Theresa Trade-
Vanguard(2) Parklands Seven
Place(1) Edenvale Mews Fleurhof Jabulani Close Place Estate Estate Park winds
Stone Arch Estate
Estate
Notes
1. Acacia Place: As announced on 18 September 2018, Transcend has concluded a sale agreement to dispose of Acacia Place (325 units) for R127.5mil
2. Vanguard: A fully-let rental enterprise comprising 60 sectional title units was acquired for R33.3 million on 23 August 2018 8
3. Wholly owned by MMA Capital Management. The intention is for IHSPM to become a wholly owned subsidiary of IHS in 2019
TRANSCEND RESIDENTIAL PROPERTY FUND 8
2.2 CURRENT PORTFOLIO OVERVIEW
• Transcend’s current property portfolio comprises 2,532 units (across 14 properties) with a valuation of R1.25bn
• Transcend concluded a sale agreement in September to dispose of Acacia Place (325 units) for R127.5mil. Acacia Place had exposure of 39%
to bulk leases (which expired) for the interim period ending 30 June 2018, resulting in a 42% vacancy (based on units)
• The rest of the portfolio has no exposure to bulk leases and is defensive in nature
Weighted
Total number average
Total number Independent Current
of units Total GLA rental per
No. Property name Location of units in Valuation Vacancy (%
owned by (m²) unit per
complex R’000 of units)
Transcend month
(R/units)
1 67 on 7th Edenvale, Gauteng 204 157 8,478 97,500 5,942 0.60%
2 Acacia Place(2) Witbank, Mpumalanga 325 325 17,891 127,500 6,853 10.00%
3 Alpine Mews Eersterivier, Western Cape 90 90 4,005 36,200 4,659 1.00%
4 Ekhaya Fleurhof Fleurhof, Gauteng 162 162 6,642 69,500 4,336 1.23%
5 Ekhaya Jabulani Jabulani, Gauteng 244 244 10,004 90,600 4,112 2.46%
6 Jackalberry Close Jansen Park, Gauteng 252 208 10,713 112,300 5,589 6.35%
7 Kensington Place Ferndale, Gauteng 56 56 2,376 35,100 6,233 1.79%
8 Molware Kosmosdal, Gauteng 252 252 11,937 138,500 5,542 3.57%
9 Parklands Parklands, Western Cape 187 187 10,044 98,100 6,092 4.28%
Village Seven,
10 Castleview, Gauteng 114 114 6,039 55,100 5,414 4.39%
Stone Arch Village
11 Terenure Estate Terenure, Gauteng 350 350 22,028 214,200 6,380 4.00%
Theresa Park
12 Theresa Park, Gauteng 242 242 12,388 98,000 4,346 5.79%
Estates
13 Tradewinds Ferndale, Gauteng 85 85 3,730 46,000 6,119 0.00%
14 Vanguard Heideveld, Western Cape 60 60 2,640 33,300 6,057 1.49%
Total 2,623 2,532 128,915 1,251,900 5,5763 4.34%4
Notes:
1. Refer to Annexure I on slide 27 for further detail on all the above properties 3. As at 1 Nov 2018
2. As referred to on slide 8, Transcend has signed an agreement to sell Acacia Place for R127.5mil 4. Vacancy excl Acacia Place is 3.45% TRANSCEND RESIDENTIAL PROPERTY FUND 92.3 CURRENT BOARD OF DIRECTORS
Name Background
Rob Wesselo (54) Rob is responsible for the South African operations of International Housing Solutions, a post he has held since 2010. In this role, he is
Chief Executive Officer responsible for sourcing investments, structuring, and negotiating deals with developers and managing the operations of IHS in South
LLB from WITS
Africa. Before joining Transcend, Rob was the Head of Commercial Property Finance (Property Investments) at ABSA. He has held
other property-focused positions such as Commercial Director at Pangbourne Properties and Head of Listed Property Funding at RMB.
Solly Mboweni (49) Prior to joining Transcend, Solly was at ABSA for 4 years in a number of senior positions. He has also managed the asset
Chief Operations Officer management and property development departments at Liberty Properties. Solly recently served as the Vice President of SAIBPP
BCom and PGDip in
Property Studies (WITS) (South African Institute of Black Property Practitioners). Solly is also Head of Housing Operations at IHS, with direct responsibility for
the activities of New Business and the Asset Management of the Rental Portfolio Since 2014.
Myles Kritzinger (34)
Chief Financial Officer Myles was appointed as CFO for Transcend on 9 March 2018. He has experience in the affordable housing market and new fund
BCom(Acc)(Hons) development as former Dealmaker at IHS. Former Manager at Deloitte & Touche, former Financial Analyst at Absa Capital and Absa
CA(SA), Diploma in
Insolvency Law (SARIPA) Retail banks and former Consultant at Nimble Risk Services.
Robert Emslie (59)
Chairman, independent Robert is an independent non-executive director of Finbond Group Limited, the independent chairman at Silverbridge Holdings Limited
non-exec director and an independent director of New Europe Property Investments Plc. He is also on the boards of a number of unlisted companies.
Undergraduate &
Graduate degree from RAU
Faith Khanyile (50)
Independent non-exec director Faith is the CEO of WDB Investment Holdings (WDBIH) and has been associated with WDBIH for over 18 years. She spent 12 years
BA (Economics) Wheaton, USA with Standard Bank, Corporate & Investment Bank from 2001 to 2013 in various senior management and executive roles.
MBA (Finance) Bentley, USA
Michael Aitken (58)
Michael has been a non-executive director of Strategic Real Estate Managers (Pty) Ltd and Emira Property Fund Limited since April
Independent non-exec
16, 2007. He also served as a non-executive director of Hyprop Investments Limited from August 2000 to June 2013, acting as
director
chairman from August 2007 to June 2013.
BA and LLB
Michael Falcone (55)
Non-executive director Mike is the chief executive officer and president of MMA Capital Management, a position he has held since January 1, 2005. Prior to
BA (Economics) (Dartmouth) his involvement with MMA Capital Management, Mike served as senior vice president and partner at the Shelter Group.
and MBA from Harvard
Cathal Conaty (53)
Non-executive director In various positions in the past 15 years, he has set up and managed private investment funds, served as a Regional Vice President of
BA (University College) (Dublin) property management, and represented investors’ interests in a variety of market-rate and subsidised properties.
MBA (IESE) (Barcelona, Spain)
TRANSCEND RESIDENTIAL PROPERTY FUND 102.4 PROPOSED BOARD AND MANAGEMENT
Proposed management and board composition (post Proposed Transactions)
• A process is underway through Transcend’s nominations committee to change the Board and appoint key personnel to the Manco (anticipated to
take place in early FY19 post implementation of the Proposed Transactions)
• It is Transcend’s intention to implement a share incentive scheme for the executive directors and management team in FY2019
Executive directors and key management (to be employed by Manco)
• Solly Mboweni and Myles Kritzinger currently serve as executive directors of Transcend
• Vanessa Perfect is currently the Head of Rental Asset Management at IHS
• It is intended that Solly, Myles and Vanessa will be dedicated exclusively to Transcend following the management restructure to be determined by
the nominations committee
Non-executive directors
• It is anticipated that certain of the non executive board directorships will be reconstituted to take into account the prevailing JSE Main Board
requirements as well as to enhance capacity and the requisite skill set of Transcend
TRANSCEND RESIDENTIAL PROPERTY FUND 112.5 ROLE OF IHS
Focus: Affordable housing Focus: Green housing
Equity: Private Equity Fund Equity: Private Equity Fund
Deals: Develop & Rental Location: SA
Size: R1.8bn (raised) Deals: Develop & Rental
Focus: Property Management Units: 28,000 (committed) Size: R2.1bn (raised)
Focus: SA & SSA End Life: Apr 2019 (ext.) Units: 11,591 (committed)
Deals: Rental End Life: Jul 2024
Size: 9,138 units under mgmt.
Employees: 175
Focus: Affordable Green housing
Name: Development Fund SAWHF Equity: Private Equity Fund
Location: SA Location: SSA (Nam & Bots)
Deals: Develop units for REIT’s IHS Deals: Develop & Rental
Size: $150m (target) IHS PM FUND II Size: R1.02bn (raised)
Units: 17,500 (projected units) (SA) Units: 942 (committed)
End Life: Jul 2024
Name:
Location:
Deals:
Kenya Rental Fund
Kenya
Green Rental
IHS Focus:
Equity:
Mid Mkt Rental
Private Equity JV
Size: $250m (target) Location: SA
IHS
Units: 7,500 (projected units) NEW Deals: Rental
BUSINESS FUND II
Size: R796m (committed)
(SSA)
RES I* Units: 2,093 (committed)
End Life: N/A
• Established in 2007, a real estate fund manager focused on development and management of affordable housing communities
• Recognise the need to both create viable housing investments and provide broader community infrastructure with easy access to schools,
shops and work opportunities
• Owned by MMA – a subsidiary of Hunt Company (private US family company – 7th largest US Multifamily Owner)
• 212 employees (37 in IHS and 175 in IHS PM)
• Based on the current size of Transcend, the external Manco is a more cost effective approach than performing this function internally. Ability for
Transcend to leverage off IHS’ resources, network and pipeline of opportunities
Notes: *The units in Res 1 are in the process of being acquired by Transcend TRANSCEND RESIDENTIAL PROPERTY FUND 122.5 ROLE OF IHS
Highlights of IHS include:
36 900 units / stands 29 800 units / stands 21 000 units / stands 7 100 units under
commenced since
completed since 2007 sold since 2007 construction
2007
9 138 units in rental 3 300 units approved R5.8bn of investor 76 investments in
equity commitments residential real estate
portfolio and fully funded
managed under IHS projects
Local pipeline Potential US Multifamily strategy
• Transcend will leverage off of IHS’ strong network and deal
making capability for future external acquisitions – access to:
- an existing pipeline of 9,900 units (R6.4bn) through the IHS
managed funds
- An existing pipeline from 3rd party developers of ±760 units
R653mil • Transcend has the ability to leverage off IHS’ network and
relationship with MMA, which in turn has access to the Hunt
Company
- 105,018 Multifamily housing units developed
- Hunt is the 7th largest Multifamily owner in the US
Notes: *The units in Res 1 are in the process of being acquired by Transcend TRANSCEND RESIDENTIAL PROPERTY FUND 132.6 INVESTMENT CASE – WHY TRANSCEND
• Management team has extensive track record in residential property investment and management
Track record
• IHS has become a market leader and has been a driver of the institutional residential rental market in SA
• Transcend focuses on medium density, secure estates with lifestyle amenities
• The affordable market, is one of the few in which demand exceeds supply with strong fundamentals, given the
Unique defensive ever increasing trend in South Africa towards urbanisation
market segment
• The affordable market has the lowest vacancy rate of the residential rental market
• Counter cyclical nature of residential property
• In addition to the Transcend portfolio, IHS currently manages approximately 9,138 quality affordable rental properties
and Transcend is well placed to acquire these units from the respective funds (upon exit)
• Transcend will leverage off IHS’ strong network and deal making capability for future acquisitions
Pipeline and growth • IHS is experienced in sourcing and stabilising properties, which will be used to the benefit of Transcend
strategy • Transcend is gaining increased exposure to off-market transactions given its rapidly increasing profile within the SA
market
• Transcend can also leverage off IHS’ shareholder – MMA (Hunt) (which specialises in investing in affordable housing
and clean energy) and gain access to Hunt’s US portfolio
• Focus on greening
• High quality assets
• Lifestyle complexes
• Safe and Secure
• Internal amenities
• +/- 5 years old
Competitive edge • Low maintenance
• Close to work and
transport
• Community friendly
14
TRANSCEND RESIDENTIAL PROPERTY FUND 143. PROPOSED TRANSACTIONS
TRANSCEND RESIDENTIAL PROPERTY FUND 153.1 IHS RES 1 TRANSACTIONS
Key transaction details
• 1,983 units spread across seven properties comprising Midrand Village, De Velde, Birchwood Village, Southgate
Units acquired
Ridge, Urban Ridge (West), Urban Ridge (East) and Urban Ridge (South)
• International Housing Solutions Residential Partners 1 (RF) Proprietary Limited (“IHS Res 1”) - currently managed
Seller by IHS. IHS Res 1 is 95% owned by PSP (Public Sector Pension Investment Board – one of Canada’s largest
pension investment managers). PSP has a 45% stake in SAWHF
• R1.21 billion at a weighted average yield of 9.76%, subject to subject to an escalation of 6% per annum (pro-rated
Purchase consideration accordingly) from 1 December 2018 (price determination date) until the date of transfer of each of the respective
units
Settlement • To be settled 100% in cash
• Gearing of 60% (c. R742 million), with the intention to settle the balance of the purchase consideration by raising
Funding
c. R495 million of new equity by way of a Vendor Placement
• Emira has provided an irrevocable commitment to subscribe for a minimum 25.1% of Transcend shares and a
maximum of 34.9% of the Transcend shares in issue post implementation of the Proposed Transactions
Underwriting and
− MMA Capital has provided an underwrite of R105mil
commitments
− Emira has also provided an underwrite of R105mil in the form of a shareholder loan to the extent that there is a
shortfall in the equity raise
• Shareholder approvals (by 30 Nov 2018)
− Related party transaction (IHS Res 1 is a related party) (50% +1) of independent Transcend shareholders
− Issue greater than 30% of shares in issue (75% +1) of all Transcend shareholders
Conditions precedent • JSE approval – Category 1 related party transaction and Reverse Takeover
• Debt (by 21 Nov 2018)
• Competition Commission (approved on 14 Nov 2018)
• Raising the equity amount (by 14 Dec 2018)
• Effective date: First day of the month following the last CP being fulfilled - expected to be 1 December 2018
• Closing date:
Effective date and − 1 Dec 2018 (if CPs are met by 23 Nov 2018); or
closing date
− 14 Dec (if CPs are met between 24 Nov and 30 Nov); or
− 31 Jan (if CPs are met between 1 Dec and 14 Dec 2018)
TRANSCEND RESIDENTIAL PROPERTY FUND 163.1 IHS RES 1 TRANSACTIONS (continued)
Valuation
1 Dec ’18 – 30
No of Independent exceeding
Property Location Purchase price Nov ‘19 Cap Rate
units valuation purchase
forecast NOI
consideration
Midrand Village 225 Clayville, Gauteng R139,295,212 R153,300,000 R14,004,788 R12,525,642 8.99%
De Velde, Western
De Velde 310 R289,144,251 R337,700,000 R48,555,749 R23,681,581 8.19%
Cape
Birchwood Village 360 Chartwell, Gauteng R266,463,076 R288,300,000 R21,836,924 R25,866,036 9.71%
Southgate Ridge 412 Naturena, Gauteng R170,420,202 R216,600,000 R46,179,798 R19,751,200 11.59%
Urban Ridge (West) 260 Midrand, Gauteng R127,516,812 R153,100,000 R25,583,188 R13,674,100 10.72%
Urban Ridge (East) 184 Midrand, Gauteng R98,783,206 R109,600,000 R10,816,794 R10,394,953 10.52%
Urban Ridge (South) 232 Midrand, Gauteng R118,277,360 R138,800,000 R20,522,640 R12,219,568 10.33%
Total 1,983 R1,209,900,119 R1,397,400,000 R187,499,881 R118,113,079 9.76%
• Transcend is acquiring the IHS Res 1 units at a 13% discount to their independent market valuation
• The IHS Res 1 units offer stable and secure income streams and are located in well-situated, high growth urban areas
• Three of the properties – Midrand Village, De Velde and Birchwood Village are well suited to a sectional title sales program and could generate
greater value for Transcend if Transcend disposes of the individual units at market value over a period of time vs. keeping the units as rental stock
• Transcend will re-invest such proceeds and acquire additional rental units by leveraging off IHS’ network and pipeline of managed funds and
making 3rd party acquisitions
TRANSCEND RESIDENTIAL PROPERTY FUND 173.2 OTHER TRANSACTIONS
• On 3 April 2018 it was announced that Transcend is in the process of acquiring the Silverleaf Portfolio
− Agreement entered into between De Facto Investments 264 Proprietary Limited and Transcend on 28 March
2018 – Transcend will acquire 76 sectional title units
Silverleaf
− For an aggregate purchase consideration of R44.5 million
• Due to delays in the finalisation of town-planning amendments, It is expected that Silverleaf should transfer to
Transcend by 1 December 2018
• On 12 June 2018 Transcend announced that it has entered into an agreement with SAWHF SA Rental 4 Trust
• Transcend acquired 60 sectional title units in the scheme known as Vanguard Residential Village 3 for an aggregate
Vanguard purchase consideration of R33.3 million
− The Vanguard transaction has been successfully concluded, with Vanguard transferring to Transcend on 23 August
2018
• On 8 October 2018 Transcend announced it has concluded a legal agreement with Sunnyshore Trade and Invest 105
Proprietary Limited (“Sunnyshore”) (owned by SAWHF) to acquire 176 residential sectional title units in two
sectional schemes known as Protea Glen for R60 million
• The Protea Glen Transaction is subject to fulfilment of inter alia the following suspensive conditions, as set out in the
Protea Glen Sale Agreements:
Protea Glen − Transcend complying with the applicable JSE Listings Requirements
− Approval from the shareholders of Sunnyshore
− Approval from Transcend shareholders (included with IHS Res 1 Transaction)
− Transcend conducting a technical due diligence
− Transcend raising the required funding to settle the purchase consideration
• The effective date (transfer) of the Protea Glen Transaction is estimated to be on or about 1 December 2018
• On 18 September 2018 Transcend announced that it has entered into a sale agreement with Instratin Properties
Proprietary Limited (“Instratin”) to:
Acacia Place − dispose of all 325 units comprising Acacia Place located in Duvha, eMalahleni (Witbank), Mpumalanga, to Instratin
− for a cash price of R392,308 per unit amounting to a total cash price of R127.5 million
− the proceeds of which will be used to reduce interest-bearing liabilities until required for new acquisitions
TRANSCEND RESIDENTIAL PROPERTY FUND 183.3 FUNDING AND CAPITAL STRUCTURE
Analysis of total funding requirement Salient terms of private placement
▪ Quantum
Proposed Transactions (at cost) R1.348bn
▪ Excluding Emira’s total subscription of 25.1%, approximately
R308mil is available for issue to the public
Transaction costs (incl. VAT) R28m
▪ Pricing
▪ Indicative clean pricing range of R6.29 per share, (cum price of
Total funding requirement R1.38bn
R6.44, assuming an issue date of 1 December 2018)
▪ Forward yield of 10.5%
Equity requirement: maximum (40%) R551m
▪ Timing
(R243m) ▪ To be completed after the last of the conditions precedent being
Less: Emira (Assume Emira take up 25.1%)
fulfilled, which is expected to be met by 30 November 2018
Private Placement R308m
Utilisation of SBSA and Nedbank facilities R825m
LTV ratio post the Proposed Transactions 46%
Salient terms of debt funding
Standard Bank & Nedbank Facility amount Terms Interest rate Profile
Facility (1) & (A) R295m 3 years 3-month JIBAR +190 bps Interest quarterly
Facility (2) & (B) R295m 5 years 3-month JIBAR +225 bps Interest quarterly
Facility (3) (RCF) R150m R857m 3 years Prime less 1% Interest monthly
Facility (4) R107m 3 years 3-month JIBAR +215 bps Interest quarterly
Facility (5) R10m 3 years Prime less 1% Interest quarterly
TRANSCEND RESIDENTIAL PROPERTY FUND 194. FINANCIALS
TRANSCEND RESIDENTIAL PROPERTY FUND 204.1 PRO FORMA EFFECTS – DISTRIBUTION PER SHARE
Transcend financial effects based on the implementation of the Proposed Transactions, being funded with 40% equity and 60% debt
Pre Proposed Transactions 31-Dec-19
Forecast distribution (pre Proposed Transactions)1 ZAR 49 396 760
# shares in issue # 73 605 662
DPS Cents 67,11
Growth ±5,0%
Pro forma adjustments ZAR
Net income from Proposed Transactions2 128 706 605
Increase in Manco fee3 -6 288 342
Increase in interest cost4 -73 219 573
Net return on re-investment of proceeds5 2 698 871
Net increase in distributable income 51 897 561
Distributable income post Proposed Transactions 101 294 321
New shares issued # 80 096 999
Total shares in issue post Proposed Transactions 153 702 661
DPS post Proposed Transactions Cents 65.90
Dilution in DPS (from current forecast) -1,8%
Forward yield (at issue price of R6.29) 10,5%
Notes:
1. Already takes into account the Vanguard and Acacia Place transactions as well as the issue of 7.3mil shares to Emira
2. Assumes effective date of 1 Dec 2018 and included 12 months net income at acquisition yields
3. Manco fee at 0.5% + VAT
4. Interest at a weighted average cost of 9.1%
5. Assumes re-investment of proceeds from sale of sectional title units relating to Midrand Village, De Velde and Birchwood Village
TRANSCEND RESIDENTIAL PROPERTY FUND 214.2 PRO FORMA BALANCE SHEET
Balance sheet FY 31 December 2017 Interim 30 June 2018 Post Proposed Transactions
Assets
Investment property 1,218,640,000 1,219,201,000 2,630,519,090
Other 51,243,000 47,254,000 174,754,000
Total assets 1,269,883,000 1,266,455,000 2,805,273,090
Liabilities
Interest bearing 555,324,000 555,377,000 1,379,984,548
Other liabilities 25,730,000 23,134,000 23,134,000
Total liabilities 581,054,000 578,511,000 1,403,118,548
NAV 688,829,000 687,944,000 1,402,154,542
Number of shares in issue 66,305,662 66,305,662 153,704,448
NAV per share 10.39 10.38 9.12
Gearing ratio (net cash) 45.6% 42.2% 46.0%
• Post implementation of the Proposed Transactions, Transcend’s total property value will be R2.63bn
• Total interest bearing debt of R1.38bn will exist with an all-in weighted average debt cost of 9.1%. It is the intention to fix a minimum of 50% of
the debt post implementation of the Proposed Transactions
• The LTV will be c. 46% and it is Transcend’s intention to reduce this to a market average of 30-40% post rolling out its pipeline
TRANSCEND RESIDENTIAL PROPERTY FUND 225. CONCLUSION
TRANSCEND RESIDENTIAL PROPERTY FUND 235.1 CONCLUSION AND TIMING
Opportunity to • Implementation of the Proposed Transactions will result in significantly enhanced scale; and
double portfolio
• Significant increase in market capitalisation
size and migrate to
− providing a solid platform to scale further and increase its shareholder base and liquidity
Main Board of JSE
• IHS Asset Management performs the asset management function of Transcend
Scalable portfolio • IHS currently manages R5.8bn in assets across 3 Funds & 1 JV and has made investments in 76 real estate projects
with access to IHS − Currently operates a rental portfolio of approximately 9 138 units
managed funds − Properties located in 5 provinces in SA
− High quality property portfolio with critical mass at attractive yields in a challenging South African economy
• Provides investors with exposure to a geographically diverse, well-managed and well-maintained portfolio of properties
that are well-located and good quality, which are expected to appreciate in value over time
Transcend
• Residential housing a unique defensive investment - potential to act as an inflation hedge over the long term,
investment case returning real growth in distributions
and outlook
• Growth profile of underlying portfolio earnings attractive
• Conservative outlook on balance sheet gearing to remain in place post the Proposed Transactions
• Transcend is seeking irrevocable funding commitments from investors for up to R308mil
• Timing of calling on such commitments is expected by 10 December 2018
Deliverable Timing
Investors meetings 12 – 21 November 2018
Irrevocable
commitments and Site visit 22 November 2018
timing Final CP Expected to be received by 30 November 2018
Equity commitments By 30 November 2018
Effective date Targeting 1 December 2018
Closing date and issue of new shares 1st week of Dec 2018
TRANSCEND RESIDENTIAL PROPERTY FUND 245.2 CONTACT DETAILS
Rob Wesselo 083 290 3868 rwesselo@ihsinvestments.co.za
Solly Mboweni 072 821 7261 smboweni@ihsinvestments.co.za
Vanessa Perfect 079 496 9409 vperfect@ihsinvestments.co.za
Myles Kritzinger 072 440 0072 mkritzinger@ihsinvestments.co.za
Panico Theocharides 082 412 0542 panico@tenureybsm.com
Shaun Stewart 082 479 7147 shaun@tenureybsm.com
Jacques Russouw 083 269 0310 jacques@tenureybsm.com
TRANSCEND RESIDENTIAL PROPERTY FUND 25ANNEXURES
TRANSCEND RESIDENTIAL PROPERTY FUND 261. TRANSCEND EXISTING PORTFOLIO
TRANSCEND RESIDENTIAL PROPERTY FUND 27TRANSCEND PORTFOLIO – CURRENT
Johannesburg Cape Town
9
12
6
8
13 11
5
10
2 1
4
7
3
TRANSCEND RESIDENTIAL PROPERTY FUND 28TRANSCEND PORTFOLIO – GAUTENG
1 67th on 7th (Edenvale, Gauteng)
Key facts Photographs
• 67 on 7th is located along Van Riebeeck Avenue, in
Edenvale, Ekurhuleni, Gauteng
• The site is well-located close to a central business
district along Van Riebeeck Avenue, and easily
accessible from major routes, specifically the N12 and
N3 highways
• All units are 2-bedroom, 1 bathroom and 55m2
Property valuation R97.5mil*
Age of property 2.8 years
Total # of units in complex 204
# of units owned by Transcend 157
Size 8,478m2
Historic occupancy rate 95.54%*
Current occupancy rate 99.40%#
Average lease term 16.3 months*
Average gross rental per unit R5,942#
Cap rate 8.25%*
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 29TRANSCEND PORTFOLIO – GAUTENG
2 Ekhaya Fleurhof (Fleurhof, Gauteng)
Key facts Photographs
• The property is located on Main Reed Road in Fleurhof,
Johannesburg, which has good access to the Joburg
CBD, transit routes, and forms part of the Fleurhof
development which is owned by Calgro M3
• Ekhaya Fleurhof consists of 162 units in 4-storey walk-
up blocks. All units are 2-bedroom, 1 bathroom at an
average size of 43m2
Property valuation R69.5mil*
Age of property 5.8 years
Total # of units in complex 162
# of units owned by Transcend 162
Size 6,642m2
Historic occupancy rate 98.15%*
Current occupancy rate 99.00%#
Average lease term 20.06 months*
Average gross rental per unit R4,336#
Cap rate 9.50%*
* *As
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 30TRANSCEND PORTFOLIO – GAUTENG
3 Ekhaya Jabulani (Soweto, Gauteng)
Key facts Photographs
• The property is located in the CBD of Soweto, directly
behind the Jabulani Mall, near to the Soweto theatre
• Ekhaya Jabulani consists of 243 residential units (of 4
storey walk-up), which are all 2-bedroom, 1 bathroom,
of average size of 43m2
• The units were completed for occupation in February
2014
Property valuation R90.6mil*
Age of property 4.8 years
Total # of units in complex 244
# of units owned by Transcend 244
Size 10,004m2
Historic occupancy rate 94.67%*
Current occupancy rate 98.77%#
Average lease term 17.64 months*
Average gross rental per unit R4,112#
Cap rate 9.50%*
* *As
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 31TRANSCEND PORTFOLIO – GAUTENG
4 Jackalberry Close (Boksburg, Gauteng)
Key facts Photographs
• Jackalberry Close is located in Jansen Park, Boksburg
of the East Rand, and consists of a total of 252
residential units, of which Transcend owns 208 units. All
units are 2-bedroom, 1 bathroom units, of 51.5m2 in 3
storey walk-ups
• The developer was Bluegate Properties, the same
developer of Molware Estate. Construction began in
May 2013 with occupation completed in mid April 2014
Property valuation R112.3mil*
Age of property 4.6 years
Total # of units in complex 252
# of units owned by Transcend 208
Size 10,713m2
Historic occupancy rate 86.06%*
Current occupancy rate 97.54%#
Average lease term 15.84 months*
Average gross rental per unit R5,589#
Cap rate 8.50%*
* *As
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 32TRANSCEND PORTFOLIO – GAUTENG
5 Kensington Place (Randburg, Gauteng)
Key facts Photographs
• The property is located near the CBD of the Randburg
suburb in Johannesburg, West of Sandton. A number of
large employers are based in the area, including Multi
Choice and Sasol. The area has a strong demand for
quality rental stock
• Kensington Place consists of 56 residential units (4
storey walk-ups). All units are 2-bedroom, 1 bathroom
units of 50m2
Property valuation R35.1mil*
Age of property 6.6 years
Total # of units in complex 56
# of units owned by Transcend 56
Size 2,376m2
Historic occupancy rate 96.43%*
Current occupancy rate 93.65%#
Average lease term 15.95 months*
Average gross rental per unit R6,233#
Cap rate 9.00%*
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 33TRANSCEND PORTFOLIO – GAUTENG
6 Molware (Midrand, Gauteng)
Key facts Photographs
• The property is located between the central business
district of Midrand and Centurion, off Samrand Road
which allows for easy access to and from the N1
motorway
• Molware Estate consists of 252 residential units (3
storey walk-ups), all 2-bedroom, 1 bathroom, with an
average size of 46m² and a crèche located adjacent to
the site
Property valuation R138.5mil*
Age of property 5.2 years
Total # of units in complex 252
# of units owned by Transcend 252
Size 11,937m2
Historic occupancy rate 98.41%*
Current occupancy rate 98.21%#
Average lease term 18.9 months*
Average gross rental per unit R5,542#
Cap rate 8.50%*
* *As
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 34TRANSCEND PORTFOLIO – GAUTENG
7 Village Seven Stone Arch Estate (Germiston, Gauteng)
Key facts Photographs
• Stone Arch Village 7 is located in Castleview, within the
greater Stone Arch estate, which was developed by
Cosmopolitan between 2011 to 2012
• The property consists of 114 units, which are all 2-
bedroom, 1 bathroom units, of size of 54m2 in 3 storey
walk-ups
Property valuation R55.1mil*
Age of property 6.7 years
Total # of units in complex 114
# of units owned by Transcend 114
Size 6,039m2
Historic occupancy rate 98.25%*
Current occupancy rate 95.72%#
Average lease term 22.39 months*
Average gross rental per unit R5,414#
Cap rate 8.25%*
* *As
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 35TRANSCEND PORTFOLIO – GAUTENG
8 Terenure Estate (Kempton Park, Gauteng)
Key facts Photographs
• Terenure consists of 350 sectional title units, which is
held 100% by Transcend. The units were developed by
Cosmopolitan, the same developer as for Stone Arch
• There is a good mix of two bedrooms, one bath stack
units and three bedrooms, 2-bathroom simplex units.
There is a crèche, gate house, clubhouse with braai
facilities, jungle gym and pool available
Property valuation R214.2mil*
Age of property 6.1 years
Total # of units in complex 350
# of units owned by Transcend 350
Size 22,028m2
Historic occupancy rate 92.86%*
Current occupancy rate 95.61%#
Average lease term 30.7 months*
Average gross rental per unit R6,380#
Cap rate 8.75%*
* *As
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 36TRANSCEND PORTFOLIO – GAUTENG
9 Theresa Park Estate (Pretoria, Gauteng)
Key facts Photographs
• Theresa Park is located in Pretoria North, Gauteng
• Consists of 242 residential units (2 storey walk-ups)
with an average size of 50m², both 1 bedroom, 1
bathroom and 2-bedroom, 1 bathroom units
Property valuation R98.0mil*
Age of property 6.4 years
Total # of units in complex 242
# of units owned by Transcend 242
Size 12,388m2
Historic occupancy rate 95.04%*
Current occupancy rate 96.00%#
Average lease term 23.79 months*
Average gross rental per unit R4,346#
Cap rate 8.50%*
* *As
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 37TRANSCEND PORTFOLIO – GAUTENG
10 Tradewinds (Randburg, Gauteng)
Key facts Photographs
• The property is located near the central business
district of the Randburg suburb in JHB, West of
Sandton. A number of large employers are based in the
area, including Multi Choice and Sasol
• Trade Winds consists of 85 residential units in a five
storey building, with an average unit size of 43m². The
property has a swimming pool, underground parking
and a lift. All units are 1 bedroom, 1-bathroom units
Property valuation R46.0mil*
Age of property 7.2 years
Total # of units in complex 85
# of units owned by Transcend 85
Size 3,730m2
Historic occupancy rate 100.00%*
Current occupancy rate 94.21%#
Average lease term 16.49 months*
Average gross rental per unit R6,119#
Cap rate 9.00%*
* *As
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 38TRANSCEND PORTFOLIO – WESTERN CAPE
11 Alpine Mews (Cape Town, Western Cape)
Key facts Photographs
• Alpine Mews is located in Eersterivier in Western Cape.
The site is in a popular area for affordable rental and is
well positioned within walking distance of a train station
and other important amenities
• The property consists of 90 units, all of which are 2-
bedroom, 1 bathroom units in 3 storey walk-ups. The
property attracts tenants with features such as secure
access control, parking for tenants and visitors, as well
as an exclusive use playground
Property valuation R36.2mil*
Age of property 5.5 years
Total # of units in complex 90
# of units owned by Transcend 90
Size 4,005m2
Historic occupancy rate 98.89%*
Current occupancy rate 90.00%#
Average lease term 18.58 months*
Average gross rental per unit R4,659#
Cap rate 9.25%*
* *As
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 39TRANSCEND PORTFOLIO – WESTERN CAPE
12 Parklands (Eersterivier, Western Cape)
Key facts Photographs
• Parklands is located in circa. 15km north/north east of
Cape Town and consists of 187 units
• This property remains very popular and has historically
performed well
Property valuation R98.1mil*
Age of property 5.9 years
Total # of units in complex 187
# of units owned by Transcend 187
Size 10,044m2
Historic occupancy rate 97.86%*
Current occupancy rate 96.43%#
Average lease term 32.17 months*
Average gross rental per unit R6,029#
Cap rate 9.00%*
* *As
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 40TRANSCEND PORTFOLIO – WESTERN CAPE
13 Vanguard (Heideveld, Western Cape)
Key facts Photographs
• Vanguard consists of 60 two bedroomed, one-bathroom
residential units of 44m2 each and located at 29 Jade
Street, off Klipfontein Road, Heideveld, Cape Town
Property valuation R33.3mil#
Age of property 3.3 years
Total # of units in complex 60
# of units owned by Transcend 60
Size 6,640m2
Historic occupancy rate 97.00%*
Current occupancy rate 100.00%#
Average lease term 27 months#
Average gross rental per unit R6,057#
Cap rate 9.00%#
* *As
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# As at 1 November 2018 TRANSCEND RESIDENTIAL PROPERTY FUND 41PORTFOLIO OVERVIEW
30 June 2018 Portfolio Highlights
GEOGRAPHIC PROFILE BY REVENUE (%) UNIT PROFILE (%)
Gauteng Western Cape Mpumalanga 2 Bed 1 Bath 1 Bed 1 Bath 2 Bed 2 Bath 3 Bed 2 Bath
3
16 6
2
11
72
89
LEASE EXPIRY PROFILE (%) AVERAGE MONTHLY PROPERTY EXPENSES (%)
Monthly Prior to 31.12.2018 Utilities Operational Admin
Prior to 30.06.2019 Prior to 31.12.2019
Vacancy
10,5
28
14,2 36
0,1
56,6
18,6
36
TRANSCEND RESIDENTIAL PROPERTY FUND 42PERFORMANCE OVERVIEW
12 months to 31 Dec 2017 6 months to 30 June 2018
NAV per share (Rand) NAV per share (Rand)
31 Dec 2017 10,39 30 Jun 2018 10,38
31 Dec 2016* 9,78 30 Jun 2017 9,93
LTV (%) LTV (%)
31 Dec 2017 42 30 Jun 2018 42
31 Dec 2016* 44 30 Jun 2017 43
Net cost-to-income ratio (%) Net cost-to-income ratio (%)
31 Dec 2017 32 30 Jun 2018 31
31 Dec 2016* 28 30 Jun 2017 30
DIVIDEND per share (cents) OCCUPANCY average DIVIDEND per share (cents) OCCUPANCY average
2017 ACTUAL 2017 ACTUAL 2018 ACTUAL
2018 ACTUAL
64.04 92.7% 30.10 88.9% / (94.9%)#
2016 ACTUAL 2016 ACTUAL 2017 ACTUAL 2017 ACTUAL
5.61* 96%* 29.81 95.9%
DISTRIBUTABLE INCOME EARNINGS per share (cents) DISTRIBUTABLE INCOME EARNINGS per share (cents)
(Rm) 2017 ACTUAL (Rm) 2018 ACTUAL
2017 ACTUAL 2018 ACTUAL
102.5 32.89
42.5 20.3
2016 ACTUAL 2017 ACTUAL
2016 ACTUAL 2017 ACTUAL
51.7* 27.26
3.7* 19.8
* For the 6 months ended 31 December 2016
# Occupancy rate if Acacia Place (with vacancy rate of 11%) is excluded TRANSCEND RESIDENTIAL PROPERTY FUND 432. IHS RES 1 PROPERTIES, PROTEA GLEN
& SILVERLEAF
TRANSCEND RESIDENTIAL PROPERTY FUND 44IHS RES 1 PORTFOLIO, PROTEA GLEN AND SILVER LEAF
Gauteng Western Cape
9
2
8
1 4 5
6
7
3
TRANSCEND RESIDENTIAL PROPERTY FUND 45IHS RES 1 PORTFOLIO – GAUTENG
1 Birchwood (Johannesburg, Gauteng)
Key facts Photographs
• Situated on Erf 92 Chartwell Extension 14 & Erf 93
Chartwell Extension 15, located at the corner of Cedar
Road & 3rd Street, Chartwell, Johannesburg
• The complex comprises 360 units (consisting of 108
one-bedroomed units, 224 two-bedroomed units and 28
three-bedroomed units), with an average size of 73m²
and monthly gross rentals ranging from R6,200 –
R11,000 per unit
Property valuation R288mil#
Age of property 2.25 years
Total # of units in complex 360
# of units owned by Transcend 360
Size 26,232m2
Historic occupancy rate 55.00%*
Current occupancy rate 82.00%#
Average lease term 13.52 months#
Average gross rental per unit R7,950$
Cap rate 9.71%^
# *As
Asatper the 2017 Annual
1 November 2018 Integrated^Report
At acquisition
* Occupancy a result of lease up $ Forecasted 2019 gross rental TRANSCEND RESIDENTIAL PROPERTY FUND 46IHS RES 1 PORTFOLIO – GAUTENG
2 Midrand Village (Midrand, Gauteng)
Key facts Photographs
• Situated on Erven 4472 to 4809 Clayville Extension 46,
Porcelain Road, Clayville, Gauteng. Transcend is
acquiring 225 units which vary from two-bedroomed
units with one bathroom, measuring 55m² to three-
bedroomed units with two bathrooms, measuring 80m²
• New lettings currently range from monthly gross rentals
of R6,500 for the two-bedroomed units up to R7,900 for
the three-bedroomed units
Property valuation R153mil#
Age of property 5.33 years
Total # of units in complex 305
# of units owned by Transcend 225
Size 14,280m2
Historic occupancy rate 89.00%*
Current occupancy rate 97.00%#
Average lease term 18.78 months#
Average gross rental per unit R7,313$
Cap rate 8.99%^
# *As
Asatper the 2017 Annual
1 November 2018 Integrated Report
^ At acquisition
* Project was held for sale $ Forecasted 2019 gross rental TRANSCEND RESIDENTIAL PROPERTY FUND 47IHS RES 1 PORTFOLIO – GAUTENG
3 Southgate Ridge (Midrand, Gauteng)
Key facts Photographs
• Situated on Erven 3030 and 3031 Naturena Extension
16, 5 Duin Place, Naturena, Gauteng. The complex
comprises 412 units, all of them being two-bedroomed
units with one bathroom, measuring approximately
53m². The units are accommodated in 62 two-storey
blocks, all of which are north facing
• New lettings currently range from monthly gross rentals
of R5,400 for first floor units to R5,600 for ground floor
units
Property valuation R216mil#
Age of property 5 years
Total # of units in complex 412
# of units owned by Transcend 412
Size 21,972m2
Historic occupancy rate 98.04%
Current occupancy rate 91.50%#
Average lease term 16.59 months#
Average gross rental per unit R5,874$
Cap rate 11.59%^
# *As
Asatper the 2017 Annual
1 November 2018 Integrated Report2019 gross rental
$ Forecasted
^ At acquisition TRANSCEND RESIDENTIAL PROPERTY FUND 48IHS RES 1 PORTFOLIO – GAUTENG
4 Urban Ridge (East) (Midrand, Gauteng)
Key facts Photographs
• Situated on Erven Erf 1397 Halfway Gardens Extension
79, 77 Fifth Road, Midrand, Gauteng. The complex
comprises 184 units, consisting of 170 two-bedroomed
units with one bathroom and measuring approximately
53m² and 14 three bed-bedroomed units with two
bathrooms measuring approximately 77m². The units
are accommodated in 13 four-storey blocks
• New lettings currently range from monthly gross rentals
of R6,300 for the one-bedroomed units to R6,700 for
the two-bedroomed units
Property valuation R110mil#
Age of property 5.08 years
Total # of units in complex 184
# of units owned by Transcend 184
Size 10,140m2
Historic occupancy rate 96.04%
Current occupancy rate 91.00%#
Average lease term 16.84 months#
Average gross rental per unit R7,084$
Cap rate 10.52%^
# *As
Asatper the 2017 Annual
1 November 2018 Integrated Report2019 gross rental
$ Forecasted
^ At acquisition TRANSCEND RESIDENTIAL PROPERTY FUND 49IHS RES 1 PORTFOLIO – GAUTENG
5 Urban Ridge (South) (Midrand, Gauteng)
Key facts Photographs
• Situated on Erf 1386 Halfway Gardens Extension 54, at
the corner of Smuts and 3rd Road, Midrand, Gauteng.
The complex comprises 232 units, all of them being
two-bedroomed units with one bathroom, measuring
approximately 54m². The units are accommodated in 8
four-storey blocks, all of them north facing
• New lettings currently range from monthly gross rentals
of R6,300 for the upper floor units to R6,500 for the
ground floor units
Property valuation R139mil#
Age of property 3.92 years
Total # of units in complex 232
# of units owned by Transcend 232
Size 12,472m2
Historic occupancy rate 96.66%
Current occupancy rate 91.81%#
Average lease term 17.19 months#
Average gross rental per unit R6,642$
Cap rate 10.33%^
# *As
Asatper the 2017 Annual
1 November 2018 Integrated Report2019 gross rental
$ Forecasted
^ At acquisition TRANSCEND RESIDENTIAL PROPERTY FUND 50IHS RES 1 PORTFOLIO – GAUTENG
6 Urban Ridge (West) (Midrand, Gauteng)
Key facts Photographs
• Situated on Erf 1399 Halfway Gardens Extension 35,
81 Fifth Road, Midrand, Gauteng. The complex
comprises 260 units, all of them being two-bedroomed
units with one bathroom, measuring approximately
57m². The units are accommodated in 4 four-storey
blocks, all of them north facing
• New lettings currently range from monthly gross rentals
of 6,100 for first floor units to R6,300 for ground floor
units
Property valuation R153mil#
Age of property 5.92 years
Total # of units in complex 260
# of units owned by Transcend 260
Size 14,907m2
Historic occupancy rate 96.28%
Current occupancy rate 91.92%#
Average lease term 17.25 months#
Average gross rental per unit R6,546$
Cap rate 10.69%^
# *As
Asatper the 2017 Annual
1 November 2018 Integrated Report2019 gross rental
$ Forecasted
^ At acquisition TRANSCEND RESIDENTIAL PROPERTY FUND 51IHS RES 1 PORTFOLIO – WESTERN CAPE
7 De Velde (Somerset Wes, Western Cape)
Key facts Photographs
• Known as Sectional Schemes De-Velde 1, 2, 4 and 5,
located on Portions 128, 131, 132 and 134 of the Farm
794 Stellenbosch RD, De Velde, Western Cape. The
complex comprises 310 units varying from one-
bedroomed units with one bathroom, measuring 38m²
to three-bedroomed units with two bathrooms,
measuring 104m²
• New lettings currently range from monthly gross rentals
of R6,600 for the one-bedroomed units up to R12,000
for the three-bedroomed units
Property valuation R139mil#
Age of property 5.08 years
Total # of units in complex 232
# of units owned by Transcend 232
Size 29,330,m2
Historic occupancy rate 88.00%*
Current occupancy rate 94.00%#
Average lease term 16.33 months#
Average gross rental per unit R10,555$
Cap rate 8.19%^
# *As
Asatper the 2017 Annual
1 November 2018 Integrated ^Report
At acquisition
* Occupancy a result of lease up $ Forecasted 2019 gross rental TRANSCEND RESIDENTIAL PROPERTY FUND 52IHS RES 1 PORTFOLIO – OTHER
8 Protea Glen (Midrand, Gauteng)
Key facts Photographs
• Situated on Erf 1399 Halfway Gardens Extension 35,
81 Fifth Road, Midrand, Gauteng. The complex
comprises 260 units, all of them being two-bedroomed
units with one bathroom, measuring approximately
57m². The units are accommodated in 4 four-storey
blocks, all of them north facing
• New lettings currently range from monthly gross rentals
of 6,100 for first floor units to R6,300 for ground floor
units
Property valuation R61mil#
Age of property 10.1 years
Total # of units in complex 176
# of units owned by Transcend 176
Size 8,480m2
Historic occupancy rate 94.08%
Current occupancy rate 92.00%#
Average lease term 29 months#
Average gross rental per unit R4,675$
Cap rate 10.34%^
# *As
Asatper the 2017 Annual
1 November 2018 Integrated Report2019 gross rental
$ Forecasted
^ At acquisition TRANSCEND RESIDENTIAL PROPERTY FUND 53IHS RES 1 PORTFOLIO – OTHER
9 Silverleaf (Pretoria, Gauteng)
Key facts Photographs
• The Property consists of 76 two bedroomed residential
units located at 649 Krige Street, Silverton, Pretoria.
• The average rental income per unit is R5,900 per
month
Property valuation R46mil#
Age of property 9 months
Total # of units in complex 76
# of units owned by Transcend 76
Size 5,364m2
Historic occupancy rate N/A
Current occupancy rate 97.00%#
Average lease term N/A#
Average gross rental per unit R6,038$
Cap rate 9.87%^
# *As
Asatper the 2017 Annual
1 November 2018 Integrated Report2019 gross rental
$ Forecasted
^ At acquisition TRANSCEND RESIDENTIAL PROPERTY FUND 54You can also read
