Urbanova Business Plan › Section 36 › Working Capital, Treasury & Cash Management

• Treasury policy: minimum cash floor of R150m plus next six
  months’ committed equity contribution to construction; surplus swept to
  call accounts with the two facility banks.
• Working capital allocation of R650m within the raise covers the
  FY2027–FY2028 operating deficit, deposits float regulation (separate
  trust accounts per the Rental Housing Act) and VAT timing on
  construction.
• VAT: developments are largely exempt residential supplies, input
  VAT on construction is a true cost embedded in the R470k unit cost,
  while the sales programme recovers inputs; the model treats this
  conservatively by embedding VAT in capex.
• Interest-rate policy: minimum 70% of drawn senior debt fixed or
  hedged for ≥5 years; the 10.25% model rate is a fixed-equivalent, so
  hedging cost is already in the numbers.
• Counterparty policy: no more than 60% of cash with a single bank;
  both facility banks must be SA D-SIBs.
• Distribution policy: nil until DSCR ≥ 1.35x on two consecutive
  test dates (per the term sheet in Section 16C); thereafter 40–60% of
  distributable income, balance retained for Phase 3.

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