Vukile acknowledges tough operating environment

Posted On Wednesday, 29 June 2011 02:00 Published by eProp Commercial Property News
Rate this item
(0 votes)

Property loan stock company Vukile shrugged off a sluggish economic recovery to increase its full year distribution to linked unitholders by 9% and to grow its net asset value by 7.6% in the 2010 financial year

Laurence RappIn its annual report, published today, chairman Anton Botha said that the listed property sector delivered a robust performance during the 2010 calendar year as illustrated by the fact that the South African Listed Property Index recorded a total return of 29.6% for the year, outperforming the other traditional asset classes.  This he attributed mainly to strong demand from both retail and institutional investors as well as the listing of a few smaller funds, which caused the market capitalisation of the sector to grow over the last year from R100 billion to R120 billion.

However, despite the strong performance from the listed property sector, conditions at the coal face remained as tough as ever.  “Vacancies remained high and bad debts and arrears have not yet started to improve from previous levels.  This, coupled with the fact that retail sales have remained depressed while energy costs and rates and taxes have increased dramatically, has caused rental levels to remain under pressure and business conditions were as tough as at any time during the past two to three years,” he said.

“We are of the opinion that the outlook for property, given that the economy has experienced several successive quarters of growth, is more positive than negative.  Consumer spending remains weak, however, and, as the property cycle lags the general economy by between 12 and 18 months, we consider any possible recovery over the next 12 months to be muted and fairly fragile.  Higher municipal rates and taxes and energy costs remain a cause for concern and this will continue to make rental bargaining difficult and keep vacancy levels under pressure.”

Last modified on Friday, 25 April 2014 18:03

Most Popular

Residential sectional title sales again on the rise

May 27, 2021
Over the past 15 years, the sectional title market in South Africa has become entrenched…

Ongoing property market uncertainty makes the right finance partner key to extracting value

May 26, 2021
Claire Denny
Results from the listed property sector in 2020 showed property values reducing by an…

Pick n Pay and Fortress co-invest in a super distribution centre development

May 26, 2021
Fortress REIT announced that their biggest logistics development to date was signed with…

Exemplar REITail declares final dividend of 49.07 cps and announces 100% distribution

May 25, 2021
Mall of Thembisa
Rural and township retail specialists, Exemplar REITail, have declared a final dividend…

East Rand Mall will soon deliver the first phase of its major taxi rank upgrade

May 26, 2021
Phase 1 upgrade to the taxi rank at EastRand Mall
The first-phase upgrade of East Rand Mall taxi rank in the retail heart of Boksburg,…

Please publish modules in offcanvas position.