:May 27 2026 17:35
JOHANNESBURG, SOUTH AFRICA
Dipula is benefitting from careful management and recent improvements in operating conditions for landlords and listed real estate investment trusts (Reits).
The company led by CEO Izak Petersen achieved a 20% year-on-year increase in its distributable earnings to R310m for the six months to end-February 2026.
Dipula also announced an upgrade to its distributable earnings guidance of 7%, to between 7% and 8% for the full 2026 financial year.
Supported by positive property valuations, with around R700m of strategic acquisitions, Dipula’s property portfolio increased in value by 12% to R11.5bn, buoyed by higher income prospects. Dipula’s net asset value increased 16% and Dipula’s average property value increased to R74m from R64m.
Dipula’s revenue, excluding straight-lining, increased 7% to R811m, net property income rose 9%, and cost containment and improved recovery levels continue to be a management priority.
The total cost-to-income ratio of 42.8% reflected a marginal decrease, notwithstanding property expenses increasing by 5%, and largely coming from escalating municipal charges and utility costs.
Operational highlights included significant leasing activity, with the retail assets’ vacancies at 5%, and total portfolio vacancies reducing from 8.5% at the end of the 2025 financial year to 7% for the six-month period. Letting activity was led by the retail and industrial sectors and office occupancies remained stable, showing isolated areas of improvement.
Dipula boosted tenant retention from 79% to 90% and achieved a significantly improved weighted average positive renewal rental rate across the portfolio of 6%, and active leasing secured sustainable income streams.
Dipula took transfer of five strategic acquisitions totalling about R700-million at various stages from September 2025, and the largest of these was the R480-million purchase of Protea Gardens Mall, transferred in January.
Petersen said his fund’s performance was also supported by a favourable interest rate environment.
“The Dipula team has delivered an excellent set of results, with all key metrics trending positively. This performance reflects our continued focus on long-term shareholder value. We continue to show that we are an actively and optimistically managed business. Dipula shareholders have enjoyed exceptional returns since listing,” said Petersen.
Dipula now owns 155 properties and generates 67% of its income from retail properties located conveniently close to where people live in townships, rural and urban convenience locations.
The company also has a core portfolio of mid-sized logistics and industrial assets, equating to 16% of its income, with multi-purpose office assets sitting at 14%, and a small noncore affordable, quality residential property portfolio at 3%.
Dipula’s South African portfolio has 58% of assets in Gauteng, and the company disposed of 12 noncore properties during the six-month period for a combined R130m.
Proceeds contributed to repaying debt and funding value-enhancing asset management strategies, quality-improving acquisitions and sustainability initiatives.
Dipula invested R56m in refurbishments and redevelopments to sustain and enhance the quality of its portfolio assets, of which R30m are for income-generating capital expenditure. Solar PV capacity grew significantly during the six-month period, nearly trebling from about 6 MW to 16.6 MW.
The company has also maintained prudent debt levels given that gearing reduced to 34% and its interest coverage ratio (ICR) strengthened 3.4 times to 2.8.
Funding costs fell 11% as a result of lower interest rates during the six-month period, and Dipula also refinanced a portion of its debt in February at more competitive rates, which also extended its debt expiry profile.
“We will continue to assess acquisition opportunities that are strategically aligned with our portfolio objectives. Dipula’s capital allocation will see us growing and enhancing the quality of properties in our retail portfolio, increasing exposure to logistics and industrial properties and advancing our sustainability programmes,” Petersen said.
He said interest rates remained Dipula’s largest macroeconomic challenge and while geopolitical tensions may temper market momentum and place near-term pressure on rental growth and interest rates, the company’s portfolio “is well positioned to navigate these challenges through disciplined asset management, the strategic disposal of noncore assets, and a targeted investment in core defensive sectors”.
alistair@propertyflash.co.za
