News24 | Accelerate sells Cedar Square mall for R630m

Cedar Square is being sold by Accelerate Property Fund for R630 million.

Accelerate/Supplied

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JSE-listed Accelerate Property Fund has sold the Cedar Square Shopping Centre in Fourways for R630 million as part of its “ongoing strategic repositioning and restructuring programme”.

However, the group, which also owns 50% of the Fourways Mall, is hanging onto the development rights associated with some 40 477 square metres of developable land at the property site.

Accelerate said on Tuesday it had agreed with private real estate group Aristonas to sell the shopping centre, which has a gross lettable area of about 44 000 square metres. The deal is still subject to shareholder approval.

Accelerate said the valuation of the property was performed by an outside party, Mills Fitchet Valuations and was based on cash flows and forward net income achieved by the property as at the end of March this year. It said it was “satisfied” with the valuation reached.

As for the development rights that Accelerate is holding, it said that if Aristonas wanted to “develop the bulk, it will be entitled to purchase the development rights by giving written notice to Accelerate”.

Accelerate noted that if its development rights remained “unutilised” on the 10th anniversary of the date of registration of transfer of the property, they would automatically transfer to Aristonas at “no consideration”.

The company, which listed in 2013, has undergone extensive restructuring recently as it works on slashing its debt levels, which in October last year sat at R3.8 billion. It has made progress in reducing its debt levels since then, thanks to asset sales. At the end of August this year, its debt stood at approximately R2.6 billion. Accelerate told News24 that some of the proceeds from the sale of its BMW Fourways building for R174 million in July also still had to be allocated to reduce debt. Its debt levels still dwarf its market capitalisation of R773 million. It has a total asset base of more than R7 billion.

In October last year, its founder, Michael Georgiou, was effectively ousted from the board of directors, with 97% of shareholders voting against his reappointment as a non-executive director. He had been CEO until 2022.