September 28 2026 21:30
JOHANNESBURG, SOUTH AFRICA
JSE-listed Accelerate Property Fund, has signed a new property development and asset management services (PMA) agreement, which could result in 15% of the mall being transferred or bought by its managers.
The PMA was signed with the same groups involved in the old one which had had issues, Flanagan and Gerard Frontiers (F&G) and Luvon Investments as the joint property and asset manager for the mall.
Accelerate appointed the companies in February 2024 to turn Fourways Mall around. t was struggling with vacancies and a tired tenant mix. However, this appointment was deemed improper as Accelerate had unilaterally appointed F&G and Luvon without first seeking approval from shareholders, which led to a public censure and R500,000 penalty. The punishment announced in August suggested that Accelerate’s management had been careless.
The new PMA moves to regularise the appointment. F&G and Luvon, as joint managers, will oversee day-to-day operations, tenant relations, and general property administration for the mall.
The joint managers have continued operating at the Mall since February 2024. Over this period, the vacancy factor has reduced from 18.8% to 6.6%, tenant turnover has increased from R226.3m to R365.2m and average trading density improved from R1,816/m² to R2,711/m². Accelerate owns a 50% undivided interest in Fourways Mall.
The new agreement provides for property management, asset management, leasing and development fees, together with a performance linked upside mechanism. If agreed normalised net collections exceed defined thresholds, the managers may become entitled to an upside participation fee, which may be settled either in cash or through the transfer of an undivided interest in the Mall. The managers also have a call option to acquire up to 15% of the Mall, with the purchase price determined using a formula based on net operating income capitalised at 8%.
It is understood that F&G may want to own the mall in its entirety eventually. Accelerate is largely held by listed group Castleview. Castleview might eventually delist Accelerate.
Under the JSE Listings Requirements, the agreement, potential minority disposal and call option are treated as related party transactions and require shareholder approval. Accelerate shareholders will therefore be asked to approve the agreement and the related transaction mechanisms by ordinary resolution, requiring a simple majority of eligible votes cast.
An irrevocable undertaking covering 50.7% of Accelerate’s shares in issue, excluding treasury shares, has already been obtained in favour of the resolutions. Accelerate is preparing a shareholder circular and notice of general meeting, with further details to be announced on SENS in due course.
alistair@propertyflash.co.za
