October 11 2026 10:30
SOUTH AFRICA
South Africa’s listed property sector has come through the latest results season in its best shape in years.
From the country’s biggest landlords to its offshore-focused counters, the message from the reporting period that ran from late July to early October was remarkably consistent: rental income is growing ahead of inflation, vacancies are falling, funding costs are lower, balance sheets are stronger and dividends are rising, in many cases by double digits. The recovery may be from a lowish base but confidence is returning to SA’s real estate investment trust (Reit) sector and to property growth stocks.
Hyprop, Attacq, Fortress and Resilient all delivered dividend growth of more than 10%, while Growthpoint, the sector’s largest fund, lifted its dividend by 7.4%. Offshore, NEPI Rockcastle and Lighthouse raised their payouts on the back of strong European shopping centre trading, Hammerson upgraded its guidance after its biggest acquisition in more than a decade, and Sirius Real Estate continued its acquisitive growth in Germany and the UK.
The numbers back up what the SA REIT Association has been tracking for months. According to its Chart Book, compiled by Ian Anderson of Merchant West Investments, rolling 12-month distribution growth for the sector reached 10.58% at the end of June – a fifth consecutive quarter of dividend growth ahead of inflation, and more than six percentage points above July’s 4.3% CPI print.
That has not stopped share prices from wobbling. SA REITs returned 1.4% in July but gave back 5.0% in August, a pullback the Chart Book attributed to profit-taking and a re-rating of the sector rather than any change in fundamentals. The income line, it noted, did not change.
Growthpoint: steady growth from the sector giant
Growthpoint Properties, the JSE’s largest REIT, reported a 4.3% increase in distributable income per share (DIPS) to 152.6c for the year to the end of June, within its guidance range of 3% to 5%. Because it raised its payout ratio to 87.5% from 85%, its total dividend rose by a stronger 7.4% to 133.5c, in line with guidance of 6% to 8%.
Net asset value per share climbed 3.8% to R21.31, while like-for-like net property income from its South African portfolio grew 4.4%, driven by cost savings and better recoveries.
Growthpoint said the stronger rand and high interest rates had constrained the contribution from its offshore investments. At home, however, it pointed to improving operating fundamentals, strong performance in the coastal metros and the high-quality income from its 50% stake in the V&A Waterfront.
The group plans to spend R2bn to R3bn a year on South African developments over the next five years. For the current financial year, about R1.4bn is earmarked for logistics and industrial developments, R500m for retail and R300m for offices.
Fortress: logistics drives double-digit growth
Fortress Real Estate Investments delivered one of the strongest sets of results among the mid to large caps, with distributable earnings up 14.2% to about R2.23bn for the year to June, ahead of its own guidance. It declared a total dividend of 178.8c a share, up about 10% from 162.44c.
CEO Steven Brown described it as “a very strong set of results”, achieved despite higher energy prices, elevated interest rates and a tough global backdrop. He credited the group’s repositioning towards premium logistics and dominant retail for the growth in earnings and valuations.
Logistics remained the main growth engine, with very low vacancies in both South Africa and Central and Eastern Europe. Fortress’s South African portfolio values rose 6.4% on a like-for-like basis, and the group sold non-core properties at a 6% premium to book value.
A capital raise during the year, combined with earnings growth, cut its loan-to-value ratio sharply from 39.1% to 34.0%, at the lower end of its target range. Fortress has raised its guidance for the 2027 financial year to distributable earnings of about R2.46bn, up from R2.31bn previously.
Hyprop: shopping centres keep delivering
Retail landlord Hyprop, which owns Rosebank Mall, Hyde Park Corner, Canal Walk and Clearwater Mall among others, increased DIPS by 11.7% to 423c for the year to June, near the top of its 10% to 12% guidance. Its dividend rose 14.4% to 351.9c.
Distributable income increased 13.7% to R1.7bn and net operating income rose 16.5%. South African tenants’ turnover grew 4.9% to R29.8bn, with trading density up 5.5%. In Eastern Europe, tenants’ turnover rose 4.2% to €659m and retail vacancies were just 0.1%.
The year was a busy one. Hyprop sold a 50% share in Woodlands Boulevard for R825m, reducing its Gauteng concentration, completed the acquisition of Galleria Burgas in Bulgaria in July, opened the Somerset Mall expansion and new food court, and hosted the launch of Africa’s first Walmart store at Clearwater Mall.
The balance sheet is now one of the strongest in the sector, with LTV falling to 28.5% from 33.6%. Hyprop expects DIPS to grow by a further 7% to 9% in the 2027 financial year.
Attacq: Waterfall City powers ahead
Attacq, owner of Mall of Africa and developer of Waterfall City in Midrand, beat its own guidance with DIPS growth of 15.5% to 125.1c for the year to June. It had guided for 11% to 14%. The final dividend rose 17.2% to 54c, taking the full-year payout to 102c.
Revenue rose 9.3% and net operating income 7%, helped by better letting, rental escalations, income from new buildings and lower funding costs. Its municipal recovery ratio also improved to 97.8% from 94.4%, which helped keep costs in check.
Waterfall City remains the growth engine. The precinct has R2.2bn of developments under construction or in the approved pipeline, of which Attacq’s effective share is about R1.3bn. Construction has started on the R634m Waterfall City Conference Centre and Hotel and the 20-storey Aspire residential tower, both due for completion in early 2028.
“Our capital structure gives us the headroom to continue developing Waterfall City,” said CFO Peter de Villiers. Attacq expects growth to moderate to 6% to 9% in the 2027 financial year as the portfolio matures.
Resilient: double-digit dividend
Resilient REIT, which focuses on dominant convenience and regional malls, lifted its interim dividend for the six months to June by 11.7% to 274.38c, from 245.72c a year earlier.
Vacancies in its South African portfolio were just 1.9%, and the group reaffirmed its full-year guidance of distribution growth of at least 9%. Its Spanish shopping centre, Salera, remained almost fully let, with vacancies of 0.2%.
Resilient also continued to invest in its energy strategy, adding battery storage at Mams Mall and Jubilee Mall, and said it expected to benefit from favourable forward exchange rates on its offshore earnings.
SA Corporate: residential comes into its own
SA Corporate Real Estate, the country’s largest listed residential rental landlord, increased interim DIPS and its dividend by 7% to 13.92c for the six months to June, maintaining a 92.5% payout ratio.
Residential assets now account for about 49% of its South African portfolio, following the acquisition of The Parks Lifestyle Apartments in December 2025. The residential portfolio continued to grow rentals above inflation with high occupancy, while apartment sales also supported earnings. Its convenience and value-focused retail centres and logistics portfolio remained resilient.
Redefine: on track for the upper end
Redefine Properties, whose financial year ended in August, will report in November. But at a capital markets day in late August, it tightened its guidance to growth of 6.5% to 7% in DIPS, at the upper end of its range.
Redefine’s see-through LTV has improved to 45.1% from 47.3%, and green funding now makes up about 38% of group debt. It is simplifying its Polish joint ventures and recycling non-core assets to further strengthen the balance sheet.
The offshore players
One of the features of this season was the strength of the JSE-listed groups with European exposure.
NEPI Rockcastle: guidance up and a move into Spain
NEPI Rockcastle, Europe’s third-largest listed retail landlord by portfolio value, increased distributable earnings per share by 3.5% to 32.14 euro cents for the six months to June. Net operating income rose 3.8% to €318m, like-for-like tenant sales grew 2.7% and occupancy remained close to full at 98.2%.
A €126m valuation uplift took the portfolio to €8.4bn, and S&P Global upgraded the group to BBB+ in July.
On the strength of the first half, NEPI raised its full-year guidance to growth of 3.5% to 4% on 2025’s 62.03 euro cents. It also announced its first investment outside Central and Eastern Europe – the €252m acquisition of MegaPark Barakaldo in Bilbao, Spain. The extension of Promenada Bucharest is set to open in April 2027.
Lighthouse: Iberia pays off
Lighthouse Properties, which owns malls in Spain, Portugal and France, grew its interim distribution by 9.7% to 1.4401 euro cents a share for the six months to June. Like-for-like net property income rose 4.5%, led by Spain at 5.6% and France at 6.6%.
Vacancies across its €1.5bn portfolio were just 1.1%, and LTV improved slightly to 35.9%. With yields compressing and competition for assets intensifying, Lighthouse said it would focus on enhancing its existing malls rather than chasing new acquisitions.
Hammerson: growth mode in the UK
UK retail landlord Hammerson, which has a secondary listing on the JSE, reported a 22% increase in EPRA earnings per share and a 22% higher interim dividend of 9.67p for the six months to June.
It bought a 50% stake in Manchester Arndale for £218m – its first major external acquisition in more than a decade – funded partly by a £189m equity placing. It now expects 2026 EPRA earnings of about £132m, up about 27%, and has set medium-term targets of 6% to 8% annual growth in both earnings and dividends per share.
Sirius Real Estate: Germany, the UK and defence
Sirius Real Estate, the London- and JSE-listed owner of business and industrial parks in Germany and the UK, reported its full-year results to the end of March in June. Funds from operations rose 8.4% to €133.5m and rental income increased 11.4% to €239.8m. The annual dividend rose 4.1% to 6.40 euro cents – its 25th consecutive dividend increase.
Like-for-like rent roll grew 6.4%, and the group invested €463.3m in acquisitions across Germany and the UK, including its first defence-related assets. It funded this through a €105m bond tap and an €88.3m equity raise.
Sirius has kept up the pace since then. In July it completed the €49.8m acquisition of a defence-supported light-industrial business park in Fulda, north-east of Frankfurt. In a half-year trading update, it reported 11% year-on-year growth in rent roll for the six months to September, with like-for-like rent roll up 5.1%. It deployed about €150m into acquisitions during the period, including the defence-focused Kiel and Fulda sites, and retains more than €250m of liquidity for further deals.
CEO Andrew Coombs has also flagged growth plans in self-storage, where Sirius operates its Smartspace product, and in defence-related industrial property, though he has stressed that defence will remain a niche rather than the core of the business.
Sirius will release its interim results on 16 November.
Several common themes emerged across the results.
Lower funding costs. Interest rate cuts over the past two years, tighter funding margins and capital raises have significantly reduced finance costs across the sector. This has been one of the biggest contributors to distribution growth, particularly at Hyprop, Attacq and Fortress.
Stronger balance sheets. Loan-to-value ratios have fallen across the board. Hyprop is at 28.5%, Fortress at 34.0% and Fairvest, which reported earlier in the season, at about 27%. Groups raised equity during the year, often at narrow discounts, showing that investors are again willing to back the sector with fresh capital.
Retail resilience. Dominant shopping centres continue to outperform. Low vacancies and rising tenant turnover at Hyprop, Resilient, NEPI Rockcastle and Lighthouse show that well-located malls remain in demand despite pressure on consumers.
Logistics demand. Logistics vacancies remain extremely low, and developers continue to build. Growthpoint has earmarked R1.4bn for logistics and industrial developments this year, while Fortress continues to roll out new logistics space in South Africa and Poland.
Energy investment. Solar PV and battery storage are now standard across the sector. Fortress operates more than 120 solar plants, Hyprop and Resilient continue to expand capacity, and Attacq highlighted its energy, water and efficiency programme. These investments protect tenants from outages and help landlords recover rising municipal costs.
Capital recycling. Groups across the sector are selling non-core assets, often at premiums to book value, and redeploying the proceeds into better-quality properties and developments. Hyprop’s Woodlands disposal and Fortress’s non-core sales are examples.
The risks
The outlook is not without risk. Companies flagged the effects of the Middle East conflict, which has pushed up oil prices, weighed on the rand and put upward pressure on inflation and bond yields. If inflation proves sticky, the South African Reserve Bank may be slower to cut interest rates, which would limit further relief on funding costs.
Guidance for the 2027 financial year also suggests growth will moderate from this year’s strong levels, and the double-digit growth rates of 2026 were partly driven by one-off factors such as lower funding costs and capital raises that will not repeat to the same extent.
The August sell-off also showed that, after a strong run, share prices have become more sensitive to sentiment, even when fundamentals hold up.
Still to come
The season is not over yet. Equites Property Fund is due to report interim results for the six months to August this month. Redefine, whose financial year ended in August, and Octodec will report in November, Sirius releases its interim results on 16 November, and Fairvest reports its full-year results on 1 December. Vukile’s interim results are out on November 30.
On the evidence so far, the sector has moved from recovery to growth. As the SA REIT Association’s numbers show, distributions are now growing well ahead of inflation, balance sheets are in good shape and most groups are looking for growth rather than simply defending their portfolios.
Key numbers at a glance
| Company | Period | Key result | Outlook |
|---|---|---|---|
| Growthpoint | FY to June 2026 | DIPS +4.3% to 152.6c; DPS +7.4% to 133.5c | R2bn–R3bn a year SA development pipeline |
| Fortress | FY to June 2026 | Distributable earnings +14.2%; dividend 178.8c | FY2027 guidance raised to c.R2.46bn |
| Hyprop | FY to June 2026 | DIPS +11.7% to 423c; DPS +14.4% to 351.9c | DIPS +7%–9% in FY2027 |
| Attacq | FY to June 2026 | DIPS +15.5% to 125.1c; full-year DPS 102c | DIPS +6%–9% in FY2027 |
| Resilient | Six months to June 2026 | Interim DPS +11.7% to 274.38c | FY2026 growth of at least 9% |
| SA Corporate | Six months to June 2026 | DIPS and DPS +7% to 13.92c | Residential c.49% of SA portfolio |
| Redefine | FY to August 2026 (results in November) | Guidance tightened to DIPS +6.5%–7% | Results due November |
| NEPI Rockcastle | Six months to June 2026 | DEPS +3.5% to 32.14 euro cents | FY2026 DEPS +3.5%–4% |
| Lighthouse | Six months to June 2026 | Interim distribution +9.7% to 1.4401 euro cents | Focus on existing malls |
| Hammerson | Six months to June 2026 | EPRA EPS +22%; interim dividend +22% to 9.67p | FY2026 EPRA earnings c.£132m |
| Sirius Real Estate | FY to March 2026 | FFO +8.4% to €133.5m; dividend +4.1% to 6.40 euro cents | H1 rent roll +11%; interims 16 November |
alistair@propertyflash.co.za
