Vukile shopping centres in South Africa and Spain returning to pre-Covid levels of trade
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VUKILE Property Fund said the trading metrics at its retail properties were largely back to pre-Covid levels.
The owner of 45 shopping centres in South Africa, including Mdantsane City and Gugulethu Square, and 18 centres in Spain, said yesterday in a pre-close statement for the six months to August 31 that 473 shops across six of its retail centres had been affected by the violence in July.
The group expected Sasria insurance reinstatement claims of some R125 million, and loss of rental claims from the violence of about R57m, the statement said.
Full year 2022 turnover was averaging 4 percent higher than the comparable period in 2020. Collections were strong at 98 percent. Vacancies were marginally up to 3.4 percent from 3.2 percent in the 2021 financial year.
SMMEs were under pressure and accounted for 60 percent of new vacancies. There was strong retention of national and second-tier tenants, although negotiations were more protracted. The urban regional portfolio footfall was trending 15 percent below pre-Covid levels, but with increased spend per head.
Sales recovered well with rural centres to 110 percent, township centres to 102 percent, urban centres to 92 percent and commuter centres to 89 percent relative to pre-Covid trends.
Footfall was still lagging with rural centres to 92 percent, township centres to 89 percent, commuter centres to 79 percent and urban centres to 70 percent, relative to pre-Covid trends. There was increased weekend trade.
The downward trend of contractual escalations continued as leases with historical high escalations came to an end. Recent reversions were concluded at an average 6.5 percent. Good progress was made on the sale of non-core assets.
In Spain, where the group holds R17.1 billion of its property portfolio, sales continue to strengthen and had surpassed 100 percent of 2019 levels in June 2021. Larger basket sizes and higher conversion rates were driving sales.
Retail park sales were already above 2019 levels. Retail parks comprise 45.1 percent of Castellana’s portfolio by gross lettable area. Footfall recovered up to 85.7 percent of 2019 levels in August 2021, the highest level since March 2020.
Over the past 18 months, the pandemic waves had affected the performance of the portfolio, however strong growth was evident once restrictions were relaxed, the group said.
Larger retailers like Inditex, JYSK, Primark, Kiwoko, Pepco, IKEA, Kiabi, Media Markt, are expanding their portfolios and wanted new space, opening new stores across the country.
BUSINESS REPORT ONLINE