Botswana Guardian: Please share with us the state at which you found the company when you assumed the CEO position, in terms of financial performance, business performance, market share and its general operations?
Dimitri Kokinos: The Company only listed in June 2011 and I assumed office in March 2012, so it was only trading for about nine months prior to my appointment. As with all new companies it takes a while to solidify itself in the market. From an operational point of view, brand and investment expectation- this is the same for LLR.
The company was on track according to the budget and things were working. However we have been able to implement processes and procedures subsequently to increase corporate governance, streamline efficiencies and maximise returns for the unit holder.
BG: As the new CEO, were you impressed with the general operations and performance of LLR?
DK: The operations and financial performance were in hand. However the share price had lagged and fallen. The only way to build shareholder value through the share price is to enhance performance of the company and build confidence in the market, the management team, the performance of the company assets and the resultant financial results from operations.
BG: Which areas of performance as the CEO, did you think needed improvement when you took office?
DK: Put a strategy in place of the underlying asset base: We have looked at the composition of the underlying assets, the associated risks and looked which assets can be enhanced in the current portfolio, and how it can be done.
We then looked at what assets are necessary to be purchased to enhance the portfolio from a nodal or sectoral perspective. Here we looked at capital constraints and how this could be addressed. We have concentrated on creating a brand for LLR in the market place and created a brand manual and marketing plan- we have started implementing this through painting all our buildings with our logo to clearly identify the buildings that belong to LLR.
We have also sponsored a couple of events where we can create awareness of the company and I have been speaking at many real estate events on behalf of LLR.
BG: In your annual report, you mentioned that you want to come up with strategies that will help make a positive turnaround at the company. Please reveal to us, what strategies do you have in mind?
DK: I don’t think we can talk about a turnaround- as there was nothing wrong with the company. What we need to talk about is enhancement. In order to enhance the portfolio and the company we have looked at how we can grow the portfolio, maximise unit-holder returns and put the company on a new footing- this is through building relationships (client, tenant, bankers etc.) and employing the right skill set/professional team.
BG: You also have expansion plans. Please share with us how and when you are planning to do that?
DK: Confidential, until we have signed all the agreements- I am reluctant to share anything
BG:Which countries are you currently eyeing for expansion and why?
DK: We are currently looking within Botswana borders and neighbouring countries. Our aim is to be invested in economically growing nodes where there will be an opportunity to create sustainable income and growth in the future.
BG: What is your view regarding Botswana’s property market?
DK: We are seeing excess commercial property coming on stream in Gaborone and this will create pressure on secondary commercial and the pricing thereof. With regards to retail- there also seems to be excess being created but there seems to be opportunities in this sector outside of Gaborone. The evident trend in Botswana property market at the moment is that there seems to be an excess of cash chasing a limited number of quality investment grade assets and the resultant is that it is driving yields down, making it more expensive than it seems commercially viable.
BG: With various upcoming property projects, competition is getting tough. What strategies do you have to beat competition?
DK: The balance sheet of LLR is unleveraged and we will use debt to grow the portfolio and this puts LLR in a good position- also through building relationships with stakeholders and co-investing, there will be an opportunity to grow through either bringing equity or a desired skill set to a potential partner.