August 18, 2016
European commercial real estate firm Global Trade Centre Group premiered Thursday on Johannesburg Stock Exchange’s main board.
GTC, which operates across Central, Eastern and Southern Europe, owns and develops Class A office and retail properties located in Poland and capital cities throughout the CEE and SEE region.
The company, listed under JSE’s Real Estate Holding and Development sector as GTC is the first Polish firm to list on the exchange as a secondary listing. GTC’s primary listing is on Warsaw Stock Exchange.
Investec Bank was the Corporate Advisor for the listing.
Donna Nemer, JSE Director of Capital Markets noted JSE’s REHD sector has gained momentum since it changed it listing requirements to include REITs. The REHD sector currently has 56 companies listed with a market cap of R666bn.
South African investors’ demand for REITs stocks has remained strong with several billion being invested in these stocks in the last three years, despite the country’s weak economy.
Investors especially have shown a strong appetite for proven track records, foreign-docimile, quality inward listed property stocks.
Nemer said GTC offers investors growth and diversification opportunity. “Investors like property. GTC has interesting assets in its portfolio and is invested in fast-growing markets and offers a very unique geographic diversification opportunity for growth [with] 63 properties in its portfolio, including both commercial and residential. GTC, offering opportunity for growth and diversification,” said Nemer.
The GTC’s portfolio is valued at €1.3 billion as of December 2015 and generates an estimated €84 million in annual net operating income. The firm has been in operational since 1994.
The portfolio consists of 40 commercial properties, providing approximately 715,000m² of office and retail space to its tenants and customers in Poland, Serbia, Hungary, Romania, Croatia, Bulgaria and the Czech Republic.
GTC Chief Executive Officer Thomas Kurzmann said during the company’s debut on JSE on Thursday that the company plans to double its income-producing portfolio with the new listing.
“Our portfolio split is 70 percent office and 30 percent retail. With our pipeline of developments, we hope to achieve a 50/50 ratio. The listing will increase Rand income, which makes us an interesting play,” said Kurzmann.
Back in July when the firm first announced its intent to list on JSE, Kurzmiann said in a statement that the firm’s listing on JSE is an attestation to South African institutional investors’ increased appetite for high-quality SEE and CEE commercial real estate properties in the last few years. Based on that increased interests, the firm decided to pursue a secondary listing on the JSE to expand it shareholder base and “provide South African investors with an opportunity to invest in a premier commercial real estate owner and operator within the region.”
GTC not only has a uniquely located Class A office and retail portfolio, but also has significant embedded growth associated with our current development pipeline,” added Kurzmiann.
Kurzmiann said the listing on JSE will also bring increased awareness of the firm’s current activities, future strategic initiatives as well as increase liquidity and tradability of shares, positioning the “brand positively with a new group of institutional investors.”
The firm currently has three projects totaling 82,000 m² of retail and office space under development in Warsaw and Belgrade and is considering another four commercial projects planned for construction in this year and next year.
The firm did not issue new shares as part of the secondary inward listing on JSE.
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