Equites Property Fund has sold a portfolio of five distribution centres in the UK and plans to invest the proceeds into its higher-yielding South African development pipeline. The specialist logistics property developer said on Wednesday that it sold the distribution centres to a fund managed by ICG Real Estate, part of London Stock Exchange-listed asset manager ICG Plc, at a property portfolio value of £200.5m (R4.46bn), equating to a transaction yield of 5.5%.The properties are located in Coventry, Reading, Burgess Hill, Barnsley and Glasshoughton, Wakefield.(Dorothy Kgosi) “This transaction marks a decisive step in Equites’ capital recycling strategy, releasing approximately £95.5m (R2.13bn) of net cash proceeds to be redeployed from a mature UK portfolio into the higher-yielding South African development pipeline over time,“ Equites said.The transaction strengthens Equites’ balance sheet by reducing the loan-to-value ratio and enhances the growth profile of distributable earnings over the long term, it said.The disposal comes after a strategic review by the board, which decided to dispose of the UK portfolio in its entirety. It marks a decisive step in Equites’ capital recycling strategy and the repositioning of the group around its core South African logistics platform, where it holds a competitive advantage and a deep pipeline of value-accretive opportunities.The transaction crystallises the value created in the UK portfolio since Equites entered the market in 2016, the board said.The net cash proceeds will be redeployed into Equites’ South African development pipeline, which includes pre-let development agreements with blue-chip tenants on long-term leases. It said these leases are expected to: enhance the weighted average lease expiry (WALE) of the portfolio;sharpen its strategic focus on Equites’ core market; and support a superior long-term growth profile of distributable earnings.Business Day