Market appetite for Fortress Real Estate Investments Limited was evident in April as the logistics property specialist successfully raised R900 million through a public bond auction.
The issuance was oversubscribed by 2.3 times, receiving R2,057 million in bids that resulted in an allocation of R900 million across three- and five-year tenors at an auction held on 17 April 2024.
High demand for the R409 million of three-year notes resulted this tenor being 1.83 times oversubscribed, settling on a margin of 140 basis points over JIBAR which was at the lower end of market guidance. Appetite for the longer-dated five-year notes that resulted in a spread of JIBAR of 158bps. The R491 million issuance was oversubscribed by 2.3 times showing the level of demand for paper issued by a trusted name with a high level of quality assets.
“The success of this debt issuance demonstrates investor confidence in Fortress, beyond the equity markets. We are pleased with the appetite shown as we plan to be a regular feature within the debt capital markets in the future, in line with our broader domestic note program which will enable to us to achieve the growth objectives we have communicated to the market” commented Ian Vorster, Fortress’ Chief Financial Officer.
The issue was launched through Fortress’ JSE-approved R20 billion domestic medium-term note programme, with the 3-year and 5-year unsecured floating rate notes set to mature in 2027 and 2029 respectively.
