Octodec chairman Alec Wapnick is a classic property success: seasoned over decades, independent minded, master of his territory. Nothing happens in Pretoria without him knowing about it: if it's a good opportunity, chances are he's taken it.

Together with his son Jeffrey and, part-time, his lawyer-daughter Sharon, he runs listed funds Octodec and Premium. They do not spread their investment risk around the country like most funds, but concentrate mostly on Pretoria, knowing that the business of property is managing real estate risk rather than avoiding it.

Premium and Octodec were the first listed funds to start converting old CBD office buildings into residential units. They have become the biggest residential property owners in Pretoria at a time when rents have doubled in a few years and values have quadrupled. The Octodec residential portfolio was producing an average of R35/m²/month compared with R16 from offices in the year to August 2006. Residential is 1,7% of Octodec's portfolio but produces 2,9% of its rental income. It makes up 16% of the Premium portfolio but contributes 26,8% of the income. Wapnick has since moved into the Johannesburg CBD and become one of its biggest residential developers. The FM understands that the conversion produces an initial return of just under 12%. This turbo-charges Octodec's current forward yield of about 7%. No other listed fund has followed the Wapnicks into residential property, mainly because it's not easy to develop the expertise.

Premium and Octodec are not just good at residential or in Pretoria. Octodec bought a dog of a shopping centre in Killarney, Johannesburg, and against all expectations has turned a good income out of it, though it seems like hard work.

Octodec was the top performer in the sector last year with a total return of 56,7% and payouts increasing at 20%-30% in recent years.

It's not all good news. Octodec is a small fund with a market cap of about R1,4bn and a premium to NAV of about 50%. The Wapnick family holds about 30% so it is considered too illiquid to attract institutional investors.

There has been talk of merging Octodec with Premium, which is slightly bigger with a R1,6bn market cap. But that wouldn't get it into the biggest 15 funds.

Where would a seasoned property man take Octodec? It's difficult to imagine the Wapnicks selling to a bigger fund. My bet is Alec Wapnick has taken more than a cursory glance at buying up the shares and taking the two companies private.