News
Posted on 2023-10-27
According to the MSCI SA Bi-Annual Property Index, commercial property returns dipped slightly during H1 2023.
The index, based on asset level data collected from a sample of 1 837
properties across 25 portfolios with a total capital value of R367.4bn
at the end of June 2023, represents approx. 56% of professionally
managed investment properties across the country. The total return for
the six-month period was 3.5% compared to the 5% of the previous
bi-annual period and comprised an income return of 3.9% which was
partially offset by a negative capital growth of -0.4%. On an annual
basis, the index’s overall total return was 8.7% which was still well
above inflation.
Despite a weak economy, trading densities of stores selling luxury brands in SA shopping centres are dwarfing all other dominant merchandise categories
according to the newly launched Clur Luxury Brands Index – an addition
to the Clur Shopping Centre Index which tracks performance for listed
and unlisted property funds at more than 4 million sqm of prime retail
space across SA and Namibia. Belinda Clur, MD of Clur International,
says that the outstanding performance of luxury brands as a category can
be gauged from trading densities for other leading sectors and the
demand for luxury brands points to an under traded position in centres,
suggesting a favourable path for responsible new space take-up.
Redefine Properties
has achieved a sustainability milestone with three of its flagship
Gauteng assets – 90 Rivonia (pictured), 2 Pybus, and Rosebank Link –
having made history by becoming the first in SA to secure Net Zero
Carbon Level 2: Measured certifications from the GBCSA.
Emira Property Fund
has finalised the sale of its entire 49.9% stake in Enyuka Property
Holdings, the rural and lower-income retail property fund. The stake was
purchased through Emira’s partner, One Property Holdings, which offered
to buy Emira out for a total of R641m. Enyuka launched with a R575m
portfolio in 2016 and it has earned an average 13.5% cash yield over the
period. Emira exited its investment, realising net cash proceeds of
R511m after the vendor loan of R130m provided to the REIT by One. The
proceeds will be reinvested into core strategies with the cash being
used to reduce debt, lowering Emira’s LTV to +- 42%.
Spear REIT has highlighted its exclusive focus on the Western Cape as a key factor in outperforming a “somewhat challenged REIT sector.”
The company published its unaudited interim results for the six months
ending August 2023, declaring an interim distribution per share of 38.33
cents on a 94% pay-out ratio. The REIT’s total portfolio comprises
426 588m2 GLA, valued at R4.46bn with contractual escalations of 7.41%, a
weighted average lease expiry (WALE) of 27 months and a heavy
industrial sector exposure of 60% of its total portfolio GLA. It
reported an overall vacancy rate of 5.81% for the period, with 3.57%
positive rental reversions and a 98.36% rental collection rate. Its LTV
currently sits at 39.58%.
