November 6 2026 16:20
SOUTH AFRICA
South Africans voted in municipal elections on Wednesday, and much of what Property Flash published this week came back, one way or another, to how well our towns and cities are run.
A new study put a R196bn price tag on Johannesburg’s poor governance. A once-celebrated affordable housing developer’s estates are headed for a liquidation auction. And the green building movement made its case that sustainability should be written into law. In between, two JSE-listed Reits showed the listed sector is still delivering, and a month of hot-desking in Paarl turned into a new building in Pretoria.
Here is what happened in property this week:
Redefine moves from stabilisation to growth
The week’s big set of results came on Monday from Redefine Properties. Distributable income rose 7.5% to R3.9bn for the year to 31 August 2026, and distributable income per share climbed 7% to 56.08c, nudging past the top of its guidance range. The dividend rose 7% to 49.06c per share.
The operating numbers were the real story. Occupancy rose to 94.8%, office vacancies fell to 9.5% from 13% a year earlier, comfortably below SAPOA’s national office vacancy rate of 11.8%, and loan-to-value dropped to 38.8%, down from a peak of 50% in 2020. Industrial is 97.2% occupied, and Poland now contributes almost 29% of distributable income.
“All of our operating metrics are the best they have been since 2022,” said COO Leon Kok.
Redefine is guiding for slower DIPS growth of 3% to 5% in FY2027, with management warning of a slowing economy and higher interest rates. CEO Andrew König said the group goes into this cycle in far stronger shape than previous ones.
Exemplar keeps its guidance as new malls open
Also on Monday, township and rural retail specialist Exemplar REITail declared an interim dividend of 90.58c, up 6.7%. Revenue rose 13.8%, net property income grew 13% and NAV per share jumped 15.7% to R19.75.
The gap between income growth and dividend growth comes down to more shares in issue, operating costs rising 15.1%, and new space that only opened after the period ended. Exemplar confirmed full-year guidance of 9% to 11% DPS growth, which puts most of the work into the second half.
That new space is significant. iTonka Square in Springs reopened in September, Leratong City Mall in Kagiso opened in late October with almost 70,000 visitors on its first day, and Ntuzuma Mall and KwaMashu Place in KwaZulu-Natal are due in March 2027. CEO Jason McCormick did flag that high diesel prices are pushing shoppers to buy closer to home.
The R200bn discount on Johannesburg
On Thursday we published one of the most striking pieces of analysis we have run this year. Will Harris, CEO of commercial property data company Gmaven, compared 25,700 matched properties and about 1,100 high-value deals in Johannesburg and Cape Town since 2020.
His conclusion is that buyers apply a R196bn discount to commercial property in Johannesburg municipality, roughly 10% of the value of all commercial property in South Africa. Office accounts for over 40% of it. Joburg office space trades at an average of R10,121/m², less than half Cape Town’s R20,524/m².
The example that leads the piece says it all. Capitec has bought the Discovery building in central Sandton for R245m, or R11,164/m², which is less per square metre than it costs to build a family house in the suburbs.
Harris argues the discount reflects one factor: the competence of local government. If service delivery improves, he says, Joburg’s commercial property owners stand to gain without having to do anything at all.
The vote that could test that theory
Which made Wednesday’s municipal elections especially interesting for property. Our report on Friday found a map dominated by hung councils. With most votes counted, the ANC remains the largest party nationally on just under 32%, but it is not leading in any Gauteng metro.
The DA is ahead in Johannesburg, Tshwane, Ekurhuleni and Nelson Mandela Bay, and has comfortably held Cape Town. The MK Party leads in eThekwini, and ActionSA has made big gains in Tshwane. Turnout recovered to above 50%, from 45.9% in 2021.
The results are still provisional, with the IEC due to declare official results on Sunday. After that, coalition negotiations will decide who actually runs the metros, and whether stable administrations emerge to fix water, power, roads and billing.
Green building should be the law, says the GBCSA
In our main opinion piece of the week, Georgina Smit, CEO of the Green Building Council South Africa (GBCSA), argued that sustainability is now the baseline rather than a premium add-on. The council wants certification to spread beyond trophy offices to mid-market developments, industrial hubs, retrofits and affordable housing, and ultimately to be written into national regulations.
On Friday we reported the winners of the GBCSA Leadership Awards, presented at the 19th Green Building Convention in Cape Town last week. The council certified 291 projects in the year to June 2026. The V&A Waterfront swept the existing buildings categories, led by the No. 6 Silo Radisson RED Hotel, while Amazon’s Cape Town developments dominated new developments, with CPT14 AWS Central the top-rated project.
Redefine was recognised for certifying the largest volume of Green Star floor area, Attacq won EDGE Commercial Leader and Growthpoint’s Meadowbrook Estate was named Net Zero Champion.
Alleyroads goes under the hammer
The week’s most sobering story was the collapse of affordable housing developer Alleyroads. On the instructions of liquidators, Galetti Corporate Real Estate will auction three of its flagship estates on 25 November: Inkanyezi Village in Katlehong, Umthala Mews in Vosloorus and Kaya Lane Estate in Lebowakgomo. Together they hold 845 apartments, many of them unfinished.
Only three years ago, Alleyroads had IFC backing, more than 1,000 apartments off the Eskom grid and a R10bn estate under way on the KwaZulu-Natal North Coast. Court records show suppliers and creditors pursuing the group and its founder, Ivan Pretorius, from 2025, and tenants have complained of water and power outages this year.
Bidding for Umthala Mews starts at R20m, against projected gross annual income of about R13m when fully let, before the cost of completing the buildings. Galetti’s Guy Dowding said the demand for affordable housing hasn’t gone away, and that a sensible auction result would show the housing still holds its value. Lenders and development finance institutions will be watching closely.
Alleyroads and founder Ivan Pretorius have upset many people in business for many years.
Unlisted Reits off to a slow start
Chad Ward, Head of Investment Research at RisCura, surveyed the unlisted property managers it monitors on the new unlisted Reit tax regime, in force since 19 August. Only two of the nine who responded plan to pursue unlisted Reit status.
The main obstacle is the requirement for 100% of the equity to be held by qualifying institutions such as retirement funds, which rules out manager co-investment and empowerment partners. One manager estimates the tax benefit could add 1.5% to 2% a year for pension fund investors, but none expects relief on the ownership rule before 2027.
From a hot desk in Paarl to Hazelwood
Finally, a story that shows how property deals can start. Pretoria developer Andries Pretorius spent a month working from Workshop17 Tabakhuis in Paarl, liked it so much that he messaged co-founder Paul Keursten on LinkedIn, and then, with his partner at Bow&Arc, bought the site Keursten picked out in Hazelwood.
The result is Workshop17 Hazelwood, a 2,455m² building and the brand’s first purpose-built location, opening in early 2027. Bow&Arc will be its landlord, investor and tenant.
What to watch
The IEC declares the official election results on Sunday, and coalition talks in the hung metros will follow. The ANC says it will name its mayoral candidates within about two weeks of the results.
Johannesburg property owners have until 30 November to object to the City’s latest supplementary valuation roll. Exemplar’s interim dividend is paid on 30 November, with the last day to trade on 24 November. The Alleyroads auction takes place on 25 November in Parktown North.
Results season continues, with Dipula reporting on 11 November, Sirius Real Estate on 16 November and Vukile on 30 November. After Redefine’s cautious guidance, the market will be watching whether others also expect growth to slow as interest rates rise.
By Alistair Anderson
