1 BILLION RAND Claim - Clairwood RaceTrack

RESILIENT Property Income Fund has received a claim for almost R1bn relating to alleged damages suffered by a property investment group as a result of Resilient family firm Capital Property Fund’s acquisition of Clairwood Racecourse.

While Resilient believes there is "no merit" to the claim, the lawyer for the claimant, The Cavaleros Group, said the matter would be pursued.

Last year, Capital acquired Clairwood Racecourse for R430m, with the intention of developing the property into a warehousing and logistics park.

Resilient CEO Des de Beer said on Thursday Resilient had on Tuesday received a summons claiming damages of R982.75m "from individuals associated with The Cavaleros Group".

The summons related to alleged damages suffered as a result of Capital’s acquisition of Clairwood Racecourse, he said.

"Based on the opinion of senior counsel there is no merit to the claim," he said.

Mr de Beer added that the Resilient board and its sponsors did not consider this to be price-sensitive information and therefore would not issue an announcement on the JSE’s stock exchange news service (Sens).

"In our experience, this sort of litigation relies on outrageous claims and innuendos and is a continuation of the harassment mentioned in the letter to Capital Property Fund’s unitholders published on Sens on November 16 2012," Mr de Beer said.

David Hertz of Werksmans Attorneys, acting for The Cavaleros Group, confirmed that "a summons has been issued and served. The matter has not been called in open court — consequently, we are precluded from discussing the matter or the merit ," he said.

Mr Hertz added that he could not yet disclose any information about what the claim entailed.

Capital Property Fund plans to convert the racecourse and rename it Clairwood Logistics Park, with an estimated development cost of R2bn.

Analysts and fund managers have expected that the conversion would be a positive move for Capital Property Fund.

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Calshelf Investments 216, a subsidiary of Cavaleros, had offered to buy the prime plot for a price between R220m and R275m, depending on the time taken to conclude the deal.

But the Cavaleros group's offer was countered by Capital Property Trust, a property unit trust established in 1984.

According to the company's website, Capital Property Fund acquired Pangbourne Properties in March 2011 and has since become one of the largest property funds in SA, focusing on industrial and commercial projects.