Growthpoint Properties Limited

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Established in 2016, Growthpoint Healthcare Property Holding (RF) Limited. (“GHPH”) is South Africa’s first healthcare Real Estate Investment Trust (REIT) with a mandate to invest exclusively in healthcare real estates in South Africa. GHPH is an unlisted REIT specialized in building a portfolio of income producing healthcare property assets including hospitals, clinics, diagnostics centers, laboratories and other healthcare related real estate. GHPH was founded and is majority owned by Growthpoint Properties Limited (“Growthpoint” or the “Company”), South Africa’s largest REIT. The balance of equity stake is owned by South African institutional investors. GHPH is managed by a Growthpoint owned and controlled company called Growthpoint Healthcare Property Management Company Proprietary Limited.GHPH will build its portfolio through: (a) acquiring existing properties; and (b) developing new properties (new developments will comprise up to 30% of GHPH’s target portfolio). GHPH already holds five assets, four of which are hospitals properties and one a medical chamber – small office suites for doctors. The hospitals properties are tenanted and operated by leading local healthcare groups such as Netcare and Mediclinic. Growthpoint performs an oversight role in respect of the Facilities Management to ensure that the tenant adequately maintains the facility. still takes care of the maintenance of physical facilities. Growthpoint is developing a fifth hospital for GHPH called Pretoria Head and Neck hospital, a specialized hospital focused on the head and neck, spinal and vascular surgery. The development is close to 90% complete with handover to the tenant for the purposes of commissioning due in May 2020. Opening of the hospital to patients is scheduled for 1st August 2020. Concurrently, GHPH is pursuing a pipeline of additional investment opportunities. The proposed IFC investment is a ZAR1.2 billion (US$80 million) equity and convertible debt package to finance the development and acquisition of properties for GHPH. The financing package consists of: (i) a US$20 million equivalent in South African Rand equity investment in GHPH; and (ii) a US$60 million (or its equivalent in South African Rand or euro) convertible C loan to Growthpoint or a wholly-owned South African subsidiary of Growthpoint. The C-loan investment shall be lent to Growthpoint (or a wholly-owned South African subsidiary of Growthpoint) for on-lending to GHPH or to develop healthcare property assets that will be transferred to GHPH. Upon the completion of the initial ramp-up phase of GHPH, which is expected to take 2-3 years, IFC will have the option to convert the C-loan or any portion of it into common equity in GHPH.Founded in 1987, Growthpoint is South Africa’s largest REIT, listed on the JSE with a market capitalization of ZAR33billion (US$2. billion) as at March 18th, 2020. Growthpoint owns and manages a diversified property portfolio valued at ZAR136.5 billion (US$8.2 billion) as at December 31, 2019. The portfolio of 502 properties is also diversified across geography and sub-sectors, that is retail, office and industrial properties. Growthpoint’s portfolio comprised of the following:  a)      South Africa: (i) 436 directly owned properties in South Africa; (ii) a 50 percent interest in the V&A Waterfront, an iconic mixed-use development in Cape Town, South Africa; and (iii) a majority stake interest in GHPH. b)      Australia: 58 properties through Growthpoint’s 66 percent investment in Growthpoint Properties Australia Limited listed at the Australia Stock Exchange. c)      Eastern Europe: a 29.8 percent interest in Globalworth Real Estate Investment Limited (GWI), which owns 60 properties in Poland and Romania valued at approximately EUR3 billiond)      Sub-Saharan Africa (ex-South Africa): a 20.3% percent interest in Growthpoint Investec African Properties Fund (GIAP), which now owns 8 properties. GHPH is managed by a Growthpoint owned and controlled company.