April 17 2026 16:00
CAPE TOWN, SOUTH AFRICA
JSE-listed Spear REIT has acquired Watergate Centre, a convenience-focused shopping centre in Mitchells Plain, Cape Town, for R442m at an initial yield of 8,37%. The transaction is earnings enhancing and anticipated to transfer on or about August 1 2026.
Watergate Centre is located along the R300 and serves the high-density residential areas of Mitchells Plain. The property comprises approximately 19 642 m² of gross lettable area (GLA) and is fully let.
The centre is anchored by national brands including Shoprite and Brights Hardware, supported by a complementary mix of retailers such as Clicks, Pep, Ackermans, Mr Price, KFC, Capitec and Zone Fitness. The retail offering is weighted towards established national operators, which account for the majority of rental income and maintain consistent footfall driven by daily-needs shopping.
According to Spear management, Watergate Centre represents a “scarce opportunity to acquire a cash-generative retail asset within a core Western Cape node”.
Its convenience-driven positioning, strong trading densities and limited competing retail offerings reinforce its role as a primary retail destination within its catchment, the group said.
The acquisition reflects an initial yield of 8.37% and a weighted average rental escalation of 6.70%.
Quintin Rossi, Chief Executive Officer of Spear REIT Limited, said the acquisition aligned with the company’s investment approach.
“Watergate Centre is a well-established, high-performing asset with a strong national tenant base and consistent trading fundamentals,” Rossi said.
“We are particularly attracted to the centre’s defensive income profile, underpinned by essential retail and daily-needs shopping, as well as its location within a densely populated and economically active catchment area,” he said.
Rossi said the transaction supports the company’s “broader capital-allocation strategy and its strategy of increasing its convenience retail portfolio with high quality assets like Watergate Centre that contribute towards accretion of earnings”.
The purchase consideration of R442m will be settled on transfer and funded through a combination of debt and cash.
Following implementation of the transaction, Spear’s retail portfolio gross lettable area will increase to 100 111 m². Retail assets under ownership will be valued at approximately R1.94bn, representing 26% of the total portfolio value of R7.2bn.
Spear was founded in 2011 as a private equity real estate investment business, focusing on owning Western Cape assets with a preference for Cape Town. The founders of Spear, Mike Flax, Abu Varachhia, and Quintin Rossi, have turned Spear from a private equity fund to a JSE-listed REIT, making it the only regionally focused REIT on the JSE that concentrates exclusively on owning high-quality assets within the Western Cape. Quintin Rossi is the Group Chief Executive Officer, supported by the executive team of Chief Financial Officer Christiaan Barnard, Chief Investment Officer Kim Pfaff-Karg, and Chief Operations Officer Cliff Toerien.
Since being listed on the JSE in November 2016 with assets valued at R1.4bn, Spear has grown significantly. Spear’s portfolio post implementation of the new acquisitions will be valued at R7.2bn, comprising a mix of commercial, industrial, retail, and mixed-use properties in the Western Cape.
Spear is a fully internally managed REIT conducting all asset, property, financial and development management in-house. Spear owns the office property, No. 2 Long Street in Cape Town.
alistair@propertyflash.co.za
