Portfolio

Portfolio

* Under Option to Continuum

1 948 166 SF GLA • 86% Occupancy • Significant Bulk for development • National & regional necessity-based anchor tenants

Strongly-performing resilient assets

 

Located in mature markets with:

 

  • Significant barriers to entry

  • High degree of housing density

  • High-value last mile distribution of retail products

  • Significant value of underlying real estate

77% of GLA = national chainstore tenants

 

63% of GLA = necessity tenants

 

Downturn resistant

 

SIGNIFICANT VALUE-ADD UPSIDE POTENTIAL – 274,000 SF TO LET, ARISING FROM RECENT PRE-COVID19 VACANCIES, AS WELL AS SIGNIFICANT BULK IN PLACE TO DEVELOP ON AN ASSET BY ASSET BASIS

 

Attractive acquisition basis of $83/SF – significantly below replacement costs

Performance during COVID-19

In contrast to the South African listed property sector and, in particular, the retail sector, the portfolio has shown a high degree of resilience during a turbulent and challenging 2020.

in The performance of the portfolio is directly attributable to the unique approach used to identify and acquire the assets. The emphasis on selecting outstanding trade areas and high performing Necessity (grocery stores) and Value (Home Depot, Big Lots, Hobby Lobby, Dick’s and Burlington) retailers with strong credit has proven to be highly effective. Necessity and Value retailers represent 63% of the portfolio revenue. Retail real estate is differentiated by location and tenancy – it cannot be broadly categorised.


During the lock-down period, grocer anchors exceeded trading expectations, online transactions increased and retailers adapted by integrating innovative kerbside collection points and delivery options. By all measures the bounce back has been extraordinary in most states and, in many cases, pent-up demand has seen trading and footfalls exceed the comparative period in 2019. Retailers have responded well and now have detailed hygiene and safety protocols in place to reassure their customers.


Although further COVID-19 spikes are anticipated in the short term, we expect our retail portfolio to continue to recover and perform well in the future, a view that is further enhanced by the roll-out of effective vaccines which will accelerate and boost consumer confidence and economic activity. 
The recent Presidential elections and the associated political turbulence are expected to resolve in due course after the presidential inauguration, and there seem to be enough bi-partisan checks-and-balances in place across the various organs of state to ensure economic stability and growth.

Q3 growth in the national economy of 33% exceeded all expectations and points to continued recovery from the COVID induced lows. Our optimism is due to the strong locations and tenant mix of the portfolio. As evidence, traffic has improved since April and is almost back to pre-pandemic levels (see the Placer.ai graph below).

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