Kgomotso Mathe

LISTED retail-focused property fund Hyprop Investments yesterday reported a significant 14,1% growth in total distributions to 308c per combined unit to for the year to December.

Hyprop, which owns Canal Walk in Cape Town, and Hyde Park, The Mall of Rosebank and The Glen, all in Johannesburg, also said that if things remained constant for the rest of the year it should post an even better distribution for 2009.

“If the market conditions remain stable, although unpleasant, Hyprop expects a distribution of between 328c and 332c a unit for the year 2009,” said outgoing CEO Pieter Prinsloo.

The company’s net income increased by 13,1%, which was also a result of Hyprop’s listed property interests, including its 37% stake in Sycom Property Fund, valued at R1,4bn.

Revenue at its shopping centres in Gauteng, Cape Town and KwaZuluNatal increased by 13,9%.

Prinsloo attributed the positive performance to the consistently high occupancy at the company’s centres and a strong demand for retail space despite weakened trading conditions.

However, Hyprop’s total vacancies at year-end were 3,3%, an increase from 0,75% during the previous year. This was due to the opening of its Stoneridge shopping centre and increased vacancies at Canal Walk. But vacancies still remained below the industry average of 5%.

“Average rental growth was 14% year-on-year, with ongoing requests for space at our well-located centres.”

Hyprop has also embarked on a R662m expansion programme earmarked for completion during 2009.

It has confirmed a new R500m loan from Standard Bank which was arranged early this year to fund the developments. Hyprop said that despite the tighter credit environment it had secured this loan at a favourable interest rate, fixed for five years.

The company’s borrowings at year end stood at R834m, keeping gearing low at 8,9%.

Hyprop’s asset management contracts with Madison are set to expire at the end of the year, said chairman Michael Aitken.

The company has prioritised the appointment of a new CEO to replace Prinsloo, who officially left Hyprop at the end of last month.

Source: Business Day