Rebosis reports improved operational performance for six months to end February 2022; focus remains on portfolio optimisation

Posted On Wednesday, 01 June 2022 07:24 Published by
Rate this item
(0 votes)

Rebosis Property Fund, a JSE listed real estate investment trust (REIT) with a high-quality diversified portfolio across commercial and retail assets, today reported its reviewed interim financial results for the six months ended 28 February 2022. 

  • Distributable income of R72.5 million (2021: R71.3 million loss)
  • 95 930m² of leases renewed across retail and commercial portfolios
  • New vacancy letting of 9 833 m2
  • 101% rental collection rate on portfolio for the period under review
  • Annualised retail trading density growth of 7.4%
    • Strong footfall growth of 14.8% y-o-y
    • Turnover growth of 11.5% y-o-y
  • Fair value of portfolio remained relatively stable at R13.0 billion (2021: 13.1 billion)
  • Revised R3.3 billion disposal to consolidate office portfolio and create liquidity

Distributable income before tax excluding once-off items increased from a R71.3 million loss in the prior comparative period to a R72.5 million distributable income. The increase is due mainly to lower finance costs of R358 million (2021: R516 million), which was mainly driven by a lower repo rate. Other operating expenses also decreased to R76 million (2021: R94.5 million), mainly because there were no expenses incurred for the deferred payment liability in the current period. 

Net property income decreased by 6% when compared on a like-for-like basis to the prior period. This is mainly due to vacancies on spaces that were occupied in February 2021.

“The retail portfolio performed well as shoppers returned to malls following Covid related trading restrictions, with year-on-year footfall growth of 14.8%, turnover growth of 11.5% and annualised trading densities up by 7.4%. We successfully renewed 95 930m2, across both the retail and commercial office portfolios, in particular at Hemingways Mall in East London and various Department of Public work renewals. New leases of 9 833m2 was also concluded in the six-month period,” commented Chief Executive Officer Otis Tshabalala.

Vacancies in the retail portfolio accounted for 12.89% of the portfolio, with the mainly sovereign-let office portfolio reporting vacancies of 24.01%, resulting in a combined average portfolio vacancy of 20.00%, excluding office properties earmarked for conversion to student accommodation. Rebosis did not experience any damage to its portfolio as a result of devastating floods in the Eastern Cape and KwaZulu-Natal.

SA REIT cost-to-income ratio was calculated at 46% whilst SA REIT administrative cost-to-income ratio increased slightly to 9% from 8% in the previous comparable period.

The portfolio, including investment property held for sale, was valued at R13.0 billion (2021: R13.1 billion). This translates to a R156 million drop in the values of the properties mostly due to a devaluation of R134 million in the retail portfolio.

The disposal of a portion of the Group’s office portfolio for a revised aggregate cash consideration of R3.3 billion is ongoing, as communicated to the market in March and May this year respectively and is expected to be concluded in the current financial year. The disposal is expected to create some liquidity and to return the entity to a better loan to value position.

“Going forward, we will continue to focus on improving property fundamentals in the current financial year, including emphasis on leasing alternatives, especially at Forest Hill Shopping Centre, to reduce vacancies and increase revenue. We will continue to prioritise negotiations with our funding providers on the renewal of expired and near-term debt facilities to bolster our liquidity in the rising interest rate environment.

“We remain cautiously optimistic of the improved trading densities and dominant position of our retail portfolio in the context of rising interest rates and higher food and fuel costs, which is expected to constrain consumer spending. We are developing specific initiatives to bring a differentiated shopping experience within the catchment area of each of our retail centres,” said Tshabalala.

Last modified on Wednesday, 01 June 2022 07:30

Most Popular

GMI Property Group adds a New Mall to its Stable: Bronkhorstspruit Mall

Jul 21, 2022
GMI Properties Group announces the development of the much-anticipated Bronkhorstspruit…

Equites Property Fund and Mabel conclude B-BBEE transaction

Jul 21, 2022
Andrea Taverna-Turisan
The JSE listed specialist logistics property fund, Equites, today officially announced…

The growing take-away and fast food, and food delivery, culture

Jul 20, 2022
Restaurant and Take-Aways data for May 2022
Restaurant and Take-Aways data for May 2022 points to “solid but slowing” growth in…

Despite hike, interest rate remains below pre-Covid levels, says Dr Andrew Golding

Jul 21, 2022
Dr Andrew Golding
With the inflation outlook deteriorating since the previous Monetary Policy Committee…

The rapidly rising cost of living is reflecting in residential rentals

Jul 21, 2022
TPN Graph-Rental Demand
Demand for residential rental properties saw some recovery in the first quarter of 2022…

Please publish modules in offcanvas position.