Growthpoint Properties: JSE Approval Sparks REIT Surge

  • Growthpoint Properties Limited approved as a REIT by JSE after receiving overwhelming shareholder support.
  • Shareholders voted 99.9% in favour of financial assistance, enabling the implementation of the Loan Agreement.
  • The approval signals confidence in Growthpoint's growth strategy and commitment to broad-based black economic empowerment (B-BBEE).

Growthpoint Properties Limited has achieved a significant milestone in its growth trajectory. On July 19, 2023, the Johannesburg Stock Exchange (JSE) approved Growthpoint’s application to be recognized as a Real Estate Investment Trust (REIT). The achievement follows overwhelming support from shareholders during a crucial General Meeting held to seek approval for financial assistance as part of a broader broad-based ownership scheme (“B-BOS”).

The General Meeting, as announced on the JSE’s Stock Exchange News Service (SENS) on June 21, 2023, was a crucial event for Growthpoint Properties. Shareholders were asked to vote on Special Resolution Number 1, which sought approval for financial assistance in terms of Section 44 of the Companies Act, no. 71 of 2008, as amended. The successful approval paves the way for Growthpoint’s implementation of a Loan Agreement, vital to realizing the envisaged B-BOS, aimed at promoting broad-based black economic empowerment (B-BBEE) and inclusivity within the organization.

The table below outlines the results of the voting at the General Meeting:

ResolutionFORAGAINST
Special Resolution Number 199.9%0.10%

The overwhelming support from shareholders, with 99.9% of the votes in favor of the Special Resolution, signifies the high level of confidence and endorsement for Growthpoint’s growth strategy.

Growthpoint Properties boasts an Issued Share Capital of 3,430,787,066 shares, and at the time of the General Meeting, 2,630,835,767 shares were voted either in person or by proxy, representing an impressive 76.68% of the total Issued Share Capital. The significant voter turnout demonstrated the engagement and interest of shareholders in the company’s decisions.

Following the approval at the General Meeting, Growthpoint Properties has now obtained the necessary authority for financial assistance in accordance with Section 44 of the Companies Act. This development enables the company to proceed with the implementation of the Loan Agreement outlined in the Circular, and further advance the B-BOS.

However, it is important to note that the full implementation of the B-BOS is subject to additional requirements. To proceed, the Trust involved in the scheme must be registered, and the B-BBEE Commission must confirm its compliance with the B-BBEE Act. Additionally, the approval of the Trust as a public benefit organization under the Income Tax Act, 58 of 1962, is crucial for the scheme to be fully realized.

Growthpoint Properties Limited’s recognition as a REIT by the JSE marks a momentous achievement for the company and is expected to bring significant benefits to its shareholders. As a REIT, Growthpoint will enjoy various tax advantages while ensuring consistent dividends for investors.

The company’s approval as a REIT comes amid a dynamic real estate landscape in South Africa. Investors have been closely monitoring Growthpoint’s strategic decisions as the company continues to adapt to market trends and shifts in the economic landscape.

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