RMB - Redefining the market

Media Release

7 November 2024

Redefining the market: RMB leads Redefine’s groundbreaking R27.7 billion South African Secured Debt Restructure

RMB acted as the Sole Mandated Lead Arranger, Lender, and Hedge Provider in the landmark R27.7 billion debt restructure for Redefine Properties Limited, one of South Africa’s largest Real Estate Investment Trusts (REITs). A debt restructure of this size – spanning 11 lenders - is the first of its kind in the South African real estate sector and is poised to set a new precedent in property financing.

Prior to this debt restructure, Redefine had entered into bilateral facility agreements with multiple lenders on varying terms, secured by multiple security special purpose vehicles. This resulted in an onerous and inefficient operating experience for both Redefine and its lenders. “This innovative restructure, completed in under six months, resulted in a common funding and security platform which will unlock efficiencies for Redefine’s debt management activities, improve its ability to raise debt at competitive pricing levels and facilitate equitable treatment of all lenders who will be governed by a set of common terms. This marks a significant milestone in how secured funding is managed in the South African listed property sector.” says Lindelwe Mbugua, Real Estate Transactor at RMB. 

The evergreen secured funding structure, covering 127 properties valued at R46.3 billion, represents 72% of Redefine’s direct South African property portfolio. The innovative framework simplifies Redefine’s debt-raising process, streamlining business operations and gives the company greater flexibility in managing its debt throughout the market cycles.

“The scale and complexity of this transaction is the first of its kind in the South African property sector and will set a benchmark for how syndicated loans are structured going forward,” says Palesa Moeketsi, Loan Syndications Transactor at RMB. Our longstanding relationship with Redefine has allowed us to deliver a solution that balances the needs of a key client while ensuring equitable treatment for all lenders.

The restructuring also enhances the credit profile of Redefine’s debt, offering funders diversified cross-sector exposure, reducing concentration risk, and improving long-term balance sheet management. Importantly, the new structure supports Redefine’s active asset management strategy.

“RMB’s deep understanding of our business, built over many years, played a pivotal role in structuring this complex funding arrangement. Their ability to negotiate favourable terms that balance the needs of all parties combined with their commercial insight and overall excellence made RMB an invaluable partner in this milestone transaction” says Ntobeko Nyawo at Redefine.

RMB would like to thank all the lenders and advisors for the roles they played in facilitating this successful restructure. 

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