Growthpoint’s financial director, Stuart Snowball.

Growthpoint Properties Limited recently announced that it had rolled R350 million of three-month senior unsecured commercial paper (CP) which expired on August 12.

The successful issue received bids from 14 potential investors totalling a massive R1,9 billion for the R350 million that was on offer. The issue was therefore more than 5.3 times over-subscribed.

The strong demand for Growthpoint paper saw the interest margin (above the three-month Jibar rate) decrease to 39 basis points (0.39%) from previous levels of 45 bps in May 2010, 52bps in February 2010 and 55 bps in November 2009.

The demand for this issue continues to reinforce the success of Growthpoint’s CP programme with its R500 million inaugural CP issue which was also significantly oversubscribed, with R1.5 billion submitted. This issue was the first for a South African listed property company.

Growthpoint financial director Stuart Snowball says the company’s continued access to capital markets through CP holds advantages for Growthpoint, including the lowered average cost of borrowings and diversification of borrowing sources.

Growthpoint is the largest South African listed property company with a market capitalisation of over R25 billion. Growthpoint has a quality portfolio of 431 properties in South Africa valued at R29,9 billion, and a further 24 properties in Australia through its investment in Growthpoint Properties Australia (GOZ), valued at R4,9 billion.