The JSE All Property Index closed at 9 979 last night.
SA REITs continued their recovery during September 2024, driven by lower interest rates according to the latest SA REIT Chart Book. Since the establishment of the GNU, REITs have returned 34% compared to 15.9% for the broader equity market and 16.7% for SA bonds. Lower interest rates benefit listed property companies, as they typically lead to reduced bond yields and discount rates, increased property values and, given that the average gearing level amount of SA REITs is around 38%, higher future profits due to declining debt costs, says Ian Anderson, Head of Listed Property and Portfolio Manager at Merchant West Investments, who compiles the monthly report. “The impact on profitability will unfold over time, as most REITs hedge their interest rate risk by fixing rates for periods averaging two to three years,” he adds.
Newpark REIT has posted its interim results for the six months ended August 2024, having extended its lease with the JSE to December 2030 and increasing its WALE (by GLA) to 5.8 years. The Group’s portfolio comprises four assets, two located in Sandton, one in Linbro Park and the other in Crown Mines. Its LTV sits at 41.7% (FY2024: 41.1%) with its debt facilities of R150m set to mature in May 2025. The Group says management is engaging with its debt funders to extend the maturity dates. Newpark declared an interim dividend of 30cps, a decrease of 14.3% compared to the 35cps for the six months ended 21st August 2023.
Equites Property Fund has declared a distribution per share of 66.50c for the six months ended August 2024, in line with full year guidance of 130 to 135 cps. Two of the REIT’s highlights during the reporting period included its exit from the ENGL development platform which it embarked on a year ago with the sale of a portion of its assets on the platform for £10m and achieving its first net-zero EDGE carbon certification. The Group’s LTV at 31st August 2024 was 41% which it estimates to reduce to 38% by yearend upon completion of various disposals.
Inospace has acquired the historic nine-storey Telkom building in Cape Town’s Foreshore to expand its urban logistics and last-mile delivery network. Built in the 1970’s, the building originally served as a post office and the central Cape Town telephone exchange for SA Post and Telecoms. The asset stood in relative isolation for many years, with many considering it an ‘ugly apartheid-era edifice’ with its Brutalist architecture. By 2004, the post office had relocated, and Telkom transformed the building into a dedicated telephone data centre but despite the multi-million-rand investment, technology left it largely redundant. The building includes underground parking, retail, and office space on the lower floors with five of its floors boasting six-metre-high floor plates, ideal for business storage and logistics operations. The top floor features premium office space with views of Cape Town and the V&A Waterfront.
Engineering company, DRA Global, intends to delist from the Australian Securities Exchange (ASX) and the JSE to undertake an off-market equal access share buy-back subject to obtaining shareholder approval. The Board believes the delistings are in its best interest considering, among other things, the low level of trading of its shares on both stock exchanges.
Checkers is the first SA retailer to launch standalone bubble tea shops in its supermarkets, in partnership with Susu whose bubble tea outlets have launched in Checkers Helderberg (August 2024) and Checkers Hyper Sandton (September 2024) with a third standalone shop to open at Checkers Gateway in the coming weeks.
Cllr Nasiphi Moya has been elected as the new Executive Mayor of the City of Tshwane following the vote of no confidence against former Executive Mayor, Cilliers Brink on the 27th of September.
