BUSINESS REPORTER
BridgeFort Capital Limited, formerly MedTech Holdings, is expediting the process of transferring its land to Arch Properties Trust,it has been established.
The Sunway and the Pomona light industrial park are two upcoming projects that BridgeFort hopes to transfer to Arch Properties as the company aims to protect investors’ value from inflation and ZWL depreciation.
BridgeFort CEO, Vernon Lapham, said the company has already moved the notion to transfer its two properties to Arch Properties Trust to accelerate construction processes.
“We aim to conclude the transfer of the Sunway land to the Arch Properties Trust this year whilst also doing designs and obtaining planning permission for this property and the Pomona property mentioned above. We will then move to the construction phase whilst raising funds for this construction along the way,” Lapham said.
He added: “The Arch Properties Trust is in place and changes to the trust deed are currently being worked on to enable the unitisation of this trust and to minimise further changes required for the envisaged conversion of this trust into a REIT in due course.
“The Arch Properties Trust owns a plot in the highly sought after Pomona light industrial park measuring 2297 m² and the Sunway stand will be transferred to this trust in exchange for units in the trust.”
Lapham said a memorandum of understanding has been signed in this regard with BridgeFort envisaged as the manager of the Trust. Once the legal changes to the trust deed have been completed, the Arch Properties Trust will be in a position to raise funds for the development of the two stands through private placements, he said.
“The intention of the Arch Properties Trust is to acquire additional land for development and list this trust as a REIT,” Lapham said.
Lapham also disclosed that at the forthcoming AGM, BridgeFort shareholders will be asked to renew the authority granted at the EGM held in November 2021 to issue up to an additional 20,000,000 Class B Preferred Shares through a placement agent at not less than the ZWL equivalent of 10 US cents.
The 15% ZSE circuit breaker is however an issue in this regard since the share price on June 14, 2023 was only ZWL$29.30 while the fair value is currently around ZWL$700.
He said should this obstacle be overcome with the assistance of the ZSE, and the placement agent is successful in placing shares, it is envisaged that the funds raised will be directed to the Arch Properties Trust where it will be invested in the development of the properties.
In its financial results for the year to December 31, 2023 BridgeFort reported a profit after tax of ZWL$568m from ZWL$373m in 2021. Turnover increased to ZWL$4.26bn as compared to 2021 turnover of ZWL$3.28bn – an increase of 30%.
However, BridgeFort incurred a significant foreign exchange loss of ZWL$586m relating to legacy creditors and credit extended by foreign suppliers – which is hedged with stock.
