Property Flash


March 27 2024

Blue-chip shopping centre landlord Hyprop Investments is optimistic that it will gain more momentum in the second half of its financial period for the year to end-June 2024. The group recently reported that its South African and East European malls had performed well but its African malls had been problematic because economic effects beyond its control.

Hyprop which has a market capitalisation of about R11.1bn, has been considered a reliable real estate investment trust (Reit) listed on the JSE which has consistently paid dividends for years. Yet in the six month period to end-December 2023, its board decided not to declare an interim dividend.

“Given the prevailing uncertainty and high degree of risk in Nigeria as a result of the unprecedented devaluation of the Nigerian naira against the US dollar and the impact thereof on Ikeja City Mall’s tenants, its net operating income and in-country debt, as well as the economic and political uncertainty in SA ahead of the elections in May 2024 and the recent announcements by Pick n Pay (which is an anchor tenant in all our SA centres), the Board has decided not to pay an interim dividend until these risks subside, in which event the interim dividend may be aggregated with the final dividend for financial year 2024,” it said.

Hyprop owns eight malls in SA including Canal Walk in Century City Cape Town (80% ownership), Capegate in Brackenfell Western Cape, and Clearwater Mall in the west of Gauteng. It also owns Hyde Park Owner and Rosebank Mall in Johannesburg as well as Woodlands Boulevard in Pretoria East, the Glen in Johannesburg South (75.15%) and Somerset Mall in the Western Cape. It also owns offices in the Rosebank precinct.

In eastern Europe, it owns four shopping centres. There are two in Croatia, west and east and there is one in Skopje, North Macedonia and one in Sofia, Bulgaria.

In Africa, Hyprop owns 75% of Nigeria’s Ikeja City Mall, 47% of Ghana’s Accra Mall and 58.85 of West Hills Mall near Accra, Ghana. It also owns 98% of Kumasi City Mall in Ghana. Hyprop is aiming to exit these Sub-Saharan African assets. Trying to sell Ikeja City Mall has been a headache for Hyprop.

Hyprop is concerned that Pick ‘n Pay will close some of the stores in its malls creating vacancies. There is talk that the retailer will close between 30 an 40 underperforming stores will be shut this year.

Hyprop’s share price is down 59% over the past 5 years.

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