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Fortress Real Estate Investments has raised about R1.35bn from institutional investors through an accelerated bookbuild, giving the property group fresh capital to speed up its logistics development pipeline in South Africa and Central and Eastern Europe as it doubles down on one of the strongest-performing sectors of the commercial property market.The group placed 55.7-million new B ordinary shares at R24.25 each, with the offering attracting strong demand despite ongoing uncertainty in equity markets.The proceeds will be used to expand Fortress’ logistics portfolio and pursue retail acquisitions that meet its investment criteria, reinforcing the management’s confidence that opportunities for growth remain attractive.“Fortress intends to use the net proceeds of the placement to advance the rollout of the South African and Central and Eastern Europe (CEE) logistics development pipeline and to conclude retail opportunities that align with Fortress’s investment criteria,” the group said.The fundraising comes as logistics assets continue to outperform many traditional commercial property segments, driven by sustained demand for modern warehousing and distribution facilities from retailers, manufacturers and e-commerce operators.“Until these developments, expansions, enhancements and acquisition opportunities are finalised, the placement proceeds will, in the short term, be deployed in a manner that avoids any significant cash drag and continues to support a healthy loan-to-value position,” it said.The new shares will increase Fortress’s B ordinary share base by about 4.5%. The group has also committed not to raise more equity through new B ordinary shares for the next 90 days after the placement, subject to limited exceptions.The group has a R5.2bn logistics development pipeline across South Africa and Central and Eastern Europe, spanning about 380,000m², with 73,000m² already under construction. Most of the remaining pipeline has yet to be committed and is expected to be rolled out over the next three to five years, subject to market conditions.
