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The oversupply of golf estates has claimed another victim.
London - Growthpoint, South Africa's largest listed property firm, expects rising costs and vacancies to cut profit margins in its home market, and is seeking growth in Australia, its chief executive said on Monday.
Norbert Sasse said he plans to triple the market value of unit Growthpoint Properties Australia to A$1bn through distressed acquisitions. The unit, bought in May, was previously named Orchard Industrial Property Fund.
"The domestic market is probably offering less value than what the Australian market is offering right now ... because there isn't distress in South Africa," Sasse told Reuters on the sidelines of a conference in London.
Growthpoint, which owns 438 commercial properties valued at R29bn in South Africa, expects top-line growth of 8% to 9% in the year to end-June 2010, while higher refinancing costs and vacancies will further depress distribution growth to about 6 percent, Sasse said.
Growthpoint had reported in August its full-year to June 2009 payout grew by 7.6%, slower than in the previous two years, due to the global recession which hit demand for new property.
- Sapa