RMB Holdings (RMH) has acquired a 34% stake in urban renewal property company, Propertuity Development Company, a South African urban renewal group.

Shareholding in Propertuity post the transaction will consist of management (46%), RMH (34%) and Buffet Investments (20%).

Buffet is an established property investor which has had significant success in backing entrepreneurial property investments.

RMH intends to fund its investment into Propertuity through preference share funding.

The successful conclusion of the investment into Propertuity is subject to regulatory and commercial approvals.

Since its creation seven years ago, Propertuity has focused on the redevelopment of dilapidated industrial and office areas in Johannesburg and Durban.

The group currently has around 50 properties in Johannesburg and 20 in Durban, with early entrance into the Pretoria CBD underway.

The financial effects of this transaction will be immaterial on the financial results of RMH over the short to medium term.

This is the second transaction for RMH in the execution of its property investment business that is set to expand alongside its current, single 34% investment in FirstRand Limited.

Propertuity represents the first investment into RMH’s specialist portfolio that will focus on niche areas of the property sector.

The specialist portfolio sits alongside RMH’s core property portfolio that will target the more traditional and larger areas of South African property.

Atterbury is RMH’s key development partner in the core portfolio.

The specialist portfolio will house best-of-breed specialist developers and managers focused on key niches in the property market.

This portfolio is aimed at achieving higher yields and faster net asset value growth than the more traditional core portfolio.

The overall RMH property strategy will focus on owner-managed businesses across a broader value chain in property.

It will primarily target unlisted opportunities and will balance net asset value growth and yield.

RMH will continue to follow a phased approach in acquiring its various property investments over the coming years.