The JSE All Property Index closed at 9 592 last night.
The decentralised vacancy rate of grades A+, A, and B office space combined, decreased to 13.3% from 14.4% in Q3 2024 according to Rode’s latest State of the Property Market report with gross market rentals for decentralised grade A-space increasing nationally by 2.7% in nominal terms when compared with Q3 2023 – better than the 2% growth recorded in Q2 2024.
The industrial property sector’s average vacancy rate was 3.6% in Q3 2024, lower than the long-term average of 4.2% with rentals increasing significantly. Industrial space of 500m2 experienced a 6.9% increase during the quarter when compared to Q3 2023 – up from the 6.1% growth in Q2 2024. Rentals for industrial space of 1 000m2 increased by 7.4%.
In the residential market, apartment vacancies (on a national level) averaged 6.3%, down from 6.7% in Q2 2024 which spurred rental growth with an increase of 4.1% y/y in September. Apartment rental growth outpaced the inflation rate (CPI), marking the first real growth since 2020.
Emira Property Fund has published its results for the six months ended September 2024, highlighting the completion of its first tranche investment in DL Invest Group, a Polish commercial real estate company with a €730m portfolio focused on logistics. The REIT invested €55.5m for an initial effective 25% equity stake in DL Invest which increased Emira's international investment to 26.8% while 73% remains in SA. The second tranche, which needs to be exercised by 31st January 2025, creates the potential for nearly 37% offshore. Emira has the option to expand its position in the company by investing an additional €44.5m which will increase its equity holding to 45%.
The Western Cape recorded the highest number of construction job opportunities during Q3 2024 with 42 000 jobs, representing a 20% rise to a total of 251 000 positions, according to Industry Insight. The North West province followed with a 36.8% y/y increase, adding 20 000 jobs to reach 76 000 (12% higher y/y and 23% above pre-Covid averages). The Free State witnessed a 45.9% q/q increase, adding 18 000 jobs to reach 58 000, making construction the top-performing sector in the province. KZN recorded a smaller increase of 4% (10 000 jobs), reaching 249 000 and marking the weakest q/q growth among the provinces. Gauteng, with the largest construction workforce, rose by 6.8% q/q to reach 323 000 jobs but witnessed a 7% decline y/y.
Stor-Age REIT more than doubled its headline earnings per share for the six weeks ended 30th September 2024, from 51.04 cps to 139.85cps (174%) with its earnings per share increasing by 137% to 181.46cps from 76.45cps. Its SA portfolio recorded a 12% increase in net operating income with its achieved rental rate up by 8.2% and occupancy of 8 900m2. The REIT’s Board declared a dividend of 57.16 cps based on a 90% payout ratio with its LTV currently sitting at 31.3%.
The offer for subscription by Boxer of newly issued shares opened on Monday morning. Pick n Pay announced in late October that it intends to list Boxer on the Main Board of the JSE with a secondary listing on A2X. The number of shares on offer (up to 202 380 953) range in price from R42.00 to R54.00 per share. Pick n Pay previously intended to raise between R6bn and R8bn, but it now anticipates the base size to be towards the upper end of guidance.
Equites Property Fund Limited has raised R558m in a debt auction. EQT922 (a 3-year note) cleared at 110bps over 3-month JIBAR and EQT023 (a 5-year note) cleared at 125bps over 3-month JIBAR – the lowest levels at which the REIT has raised listed debt funding since its inception in 2014.
The market can look forward to a ‘decent’ performance from Dipula, says CEO Izak Petersen. The REIT published its results for the year ended August 2024, reporting portfolio growth of 4% in value to R10.2bn and contributing a 5% increase in its NAV. Its revenue increased by 7% to R1.487bn (2023: R1.395bn) despite negative rental reversions in its government-tenanted offices and lower income due to prior-year disposals. Its overall portfolio vacancy rate increased from 6% to 7.5% primarily due to higher vacancies in its office and industrial assets. Its retail portfolio recorded improved vacancies from 7.5% to 6.4%, its office portfolio (22%), and its industrial portfolio (3%). Its Board declared a final gross dividend of 24.38cps for the period, totalling 90% of distributable earnings with its LTV remaining unchanged at 35.7%.
The Spanish government has recommended the removal of tax advantages for Spanish REITs (SOCIMIs) and if approved, this could reduce funds from operations (FFOs) for companies exposed to the country, according to online European news platform, The Corner. In a SENS announcement, Vukile Property Fund, with a 61% exposure in Spain, told shareholders that it is too early and speculative to comment and following a consultative process at government level, it will make a more informed assessment on the proposed changes.
2024 marks Raubex’s 50th anniversary with its share price also trading above R50 per share. The Group reported a 34.7% increase in its operating profit to R846.2m for the six months ended August 2024 (H1 2024: R628.4m). Earnings per share increased 48.2% to 286 cps (H1 2024: 193 cps) with headline earnings per share also increasing by 49.8% to 284.3 cps (H1 2024: 189.8). Cash generated by operations was up 110% compared to the prior period. Its Board declared a dividend of 94 cps (H1 2024: 63 cps).
