Accelerate Property Fund Ltd (JSE:APF) News - The Disposal By Accelerate Of The Leaping Frog Shopping Centre

ACCELERATE PROPERTY FUND LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2005/015057/06)
Share code: APF ISIN: ZAE000185815
Bond company code: APFE
(“Accelerate”, “APF” or the “Company”)

THE DISPOSAL BY ACCELERATE OF THE LEAPING FROG SHOPPING CENTRE

1.   INTRODUCTION
     Shareholders and noteholders are advised that Accelerate (“Seller”) has entered into
     a sale of letting enterprise agreement (the “Agreement”) with Dorpstraat Capital
     Growth Fund Proprietary Limited (“Purchaser”), to dispose of The Leaping Frog
     Shopping Centre (“Leaping Frog” or the “Property”) (the “Transaction”) on 5 April
     2022.

2.   THE PROPERTY
     The Leaping Frog, a convenience shopping centre located on the corner of William Nicol
     Drive and Mulbarton Road, Beverley, Fourways, Gauteng forms part of Accelerate’s retail
     portfolio and was acquired by Accelerate on or about 12 December 2013.

     As at 30 September 2021, The Leaping Frog was valued at R 140 300 000.00 and is being
     sold for a maximum cash consideration of R130 000 000.00 (One Hundred and thirty
     million Rand) at a yield of 8.8%.


3.   THE CONSIDERATION AND APPLICATION OF THE SALE PROCEEDS

     It is the intention of Accelerate to apply the full proceeds to the reduction of debt and/or
     reinvestment.

4.   RATIONALE FOR THE TRANSACTION AND UPDATE ON BALANCE SHEET
     OPTIMISATION STRATEGY

     While the centre has performed adequately over the years it now requires a significant
     re-development in order to maintain value and compete with new centres in the area. The
     purchaser has significant expertise in the redevelopment of convenience and
     neighborhood shopping centres.

     Given Accelerate’s ongoing drive to strengthen it’s financial position, the decision was
     taken to dispose of the asset, which will be redeveloped by the Purchaser within certain
     agreed parameters. Accelerate retains at it’s sole discretion an option to repurchase 50%
     of the Property post redevelopment.

     In light of the above, Accelerate has taken the decision to dispose of the property at a
     7,1% discount to current book value.

   5.   KEY TRANSACTION TERMS
        The effective date for the Transaction will be the date on which the last of the conditions
        precedent are fulfilled or waived, as the case may be, which is expected to be during May
        2022.

   7.   CONDITIONS PRECEDENT
        The closing of the Transaction is subject to the following conditions precedent:

        •   Due diligence period of 45 days post signature date;
        •   Guarantees to be issued within 3 business days after successful completion of the
            due diligence exercise; and
        •   Other necessary consents and approvals customary for a transaction of this nature.


   8.   INFORMATION RELATING TO THE PROPERTY
        The details of the Property including location, gross lettable area (“GLA”), net rent,
        remaining lease term and independent valuation are as follows:

                                              Net
                                                                          Remaining                                         Effective
Property                          GLA         rent        Disposal                                Last valuation
            Location                                                      lease term                                        date of the
/ Tenant                          (m2)        per         Price                                   (ZAR) **
                                                                          (WALE)(years)                                     valuation
                                              m2 *
            Erven 937 and
            938 Beverley
The         Ext 67 and
                                                                                                                            30
Leaping     Portion 351 of        11,027      R86,6       R130 000
                                                                          2,2 years               R140 300 000.00           September
Frog        the farm              m2          / m2        000
                                                                                                                            2021
            Zevenfontein
            407 JR,
            Gauteng



             * The weighted average net rent per m2 (also the profit attributable to the net assets of Leaping Frog), billed to
             tenants as at the date of signature of the sale agreements.

             ** Directors valuation as at 30 September 2021 (which the Company is satisfied with) based on cash flows and
             forward net income achieved by the Property at valuation date.

   9. WARRANTIES
        The Seller has provided warranties and indemnities to the Purchaser that are standard for
        a transaction of this nature.


   10. CATEGORISATION OF THE TRANSACTION
        In terms of the Listings Requirements of the JSE Limited the Transaction is classified as
        a Category 2 transaction for APF and does not require shareholder approval.

Johannesburg
07 April 2022

Equity Sponsor
The Standard Bank of South Africa Limited

Debt Sponsor
Rand Merchant Bank (a division of FirstRand Bank Limited)

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Certain statements in this announcement may be considered forward-looking. Although APF
believes that the expectations reflected in any such forward-looking statements relating to the
Transaction are reasonable. The information has not been reviewed or reported on by the
reporting accountants and auditors and no assurance can be given by APF that such
expectations will prove to be correct. APF does not undertake any obligation to publicly update
or revise any of the information given in this announcement that may be deemed to be forward-
looking.

Date: 07-04-2022 01:23:00
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