Tenants Like Exxon Help Grit’s Pitch for London Capital Raising

(Bloomberg) -- Grit Real Estate Income Group Ltd. is seeking to double its market value to more than $800 million through a London share sale, highlighting lucrative Africa real-estate tenants such as Anadarko Petroleum Corp. and Exxon Mobil Corp. to sell the investment case.

The pan-African property company is looking to raise funds alongside a move to the premium board of the London stock exchange and a relocation to Guernsey from Mauritius, Chief Executive Officer Bronwyn Corbett said on Wednesday. The cash will be invested in projects across the continent, including industrial sites and hotel resorts.

“The intention is to move the money as quickly as possible,” Corbett, 38, said in an interview at Bloomberg’s Johannesburg office. “When we issue the prospectus all the deals will be lined up so the money will flow out of the door immediately.”

Oil Majors

A highlight of its portfolio is a number of premium offices in Maputo, the capital of Mozambique, where its tenants include multinational oil and gas companies such as Anadarko and Exxon. Grit had to ride out a period of economic turmoil in the southeast African country but is now reaping the benefit of its presence in a country that’s attracted $50 billion investment in natural gas projects.

Exxon “were on 1,000 square metres in our office building,” Corbett said. “They have gone up to 4,000 just due to the extent of the number of people they have.”

Grit has $600 million of projects lined up in countries including Kenya, Ghana, Uganda and Senegal, the CEO said.

Corbett targeted Africa, often perceived as a high-risk and immature property market, as an alternative to more competitive destinations such as Eastern Europe. Grit is generating returns of about 12% a year, and raised $132 million in an initial public offering last year.

Grit has no plans to invest outside Africa, Corbett said, or in South Africa, which the company sees as both saturated and depressed. The company is also calling a halt to spending on retail assets, which currently make up almost a third of the portfolio. That’s partly because large shopping malls aren’t doing as well as planned, she said.

“I want half of my portfolio exposed to investment-grade countries, which are Morocco, Mauritius and Botswana, and the other half into ‘growth Africa,”’ the CEO said.

--With assistance from John Bowker, John McCorry and Gordon Bell.

To contact the reporters on this story: Loni Prinsloo in Johannesburg at lprinsloo3@bloomberg.net;Roxanne Henderson in Johannesburg at rhenderson56@bloomberg.net

To contact the editors responsible for this story: Stefania Bianchi at sbianchi10@bloomberg.net, John Bowker, Pauline Bax

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