SA REIT Association

Sustainability is now a key priority for businesses, as capital markets increasingly assess performance through ESG metrics when making investment decisions. This trend is supported by compelling evidence linking strong ESG performance to an organisation’s ability to secure long-term competitive and financial advantages. For more insights about the SAREIT Sustainability Disclosure Guide, download a free copy: https://bit.ly/4hCC0ir #SAREIT #SustainabilityGuide #NedbankCIB #SustainableFinance #RealEstateSustainability #PropertyFinance Nedbank Corporate and Investment Banking

According to JLL Africa, office nodes in Johannesburg, including Sandton, Rosebank, and Waterfall, are experiencing increased demand and a decline in vacancies, driven by tenants' growing preference for green buildings. Green buildings are seen as the only office segment in Johannesburg to have experienced positive rental growth in the second quarter of 2024, with nominal growth of about 3% to 4% achievable.   #GreenBuildings #OfficeTenants #OfficeVacancies #RentalGrowth

The SA REIT Sustainability Guide is available for download on our website - https://bit.ly/40HSfF8

We are thrilled to announce the launch of the SAREIT Sustainability Disclosure Guide in partnership with Nedbank Corporate Investment Banking (CIB) Property Finance. This comprehensive resource is designed for South African REIT members and property organisations beginning their sustainability reporting journey. The guide aligns with the voluntary JSE Sustainability and Climate Change Disclosure Guidance of 2022 and incorporates global best practices tailored for the South African property sector. It offers essential information to enhance reporting and outlines a framework of recommendations for sustainability and climate-related disclosures. By standardising key sustainability concepts, it aims to assist both issuers and investors in the South African property market. Use this link to download the guide: https://bit.ly/4hCC0ir #SAREIT #SustainabilityGuide #NedbankCI #SustainableFinance #RealEstateSustainability #PropertyFinance Nedbank CIB Nedbank Joanne Solomon Gary Garrett

With property fundamentals in South Africa continuing to strengthen, a decline in the cost of capital (both debt and equity), increasing transactional activity, and improving investor confidence, South African REITs are well-positioned to build on their strong gains throughout 2024, said Ian Anderson Head of Listed Property and Portfolio Manager at Merchant West Investments, and compiler of the SA REIT monthly Chart Book. He said valuations remain attractive relative to historical levels and other asset classes.  “The prospect of lower interest rates should provide additional support for higher prices in the short to medium term, while dividend growth is expected to accelerate from 2025 onward as borrowing costs decrease and improved fundamentals drive stronger net property income growth.” In October, the yield on 10-year U.S. Treasuries surged by 53 basis points, marking the largest monthly increase of 2024. In South Africa, the rand weakened by 2% against the U.S. dollar, while the yield on the government’s benchmark R2035 bond rose by over 50 basis points. Amid rising discount rates, South African REITs were unable to maintain their strong performance, registering a 1.3% decline in October, thus breaking a streak of four consecutive months of gains. Both the South African equity market (-0.9%) and bond market (-2.2%) also posted negative returns during the month. “Despite the monthly setbacks, South African REITs remain the top-performing asset class in 2024, with a year-to-date return of 32.3%, far outpacing equities (14.8%) and bonds (14.2%),” he said. Visit https://lnkd.in/dZcze3jw to download the SA Reit Chartbook for October. #SAREITChartbook #SouthAfricanREITs #PropertyInvestment #InterestRates #PropertyIncome 

The average payout ratio for South African Real Estate Investment Trusts (REITs) has decreased from 93.5% in FY19 to 75.6% in FY23. However, payout ratios are projected to rise to about 78.4% in FY24, according to the Nedbank Corporate and Investment Banking (CIB) research commissioned by the Research Committee of the SA REIT Association on the payout ratios of JSE-listed REITs in a global context. With REITs lowering their debt levels, strengthening their balance sheets, and reporting higher earnings, it is likely that payout ratios could increase from current levels. Download the SA REIT payout ratio research: https://lnkd.in/dkEM5mWX #SAREITS #PayouRatio #PropertyEarnings Nedbank Corporate and Investment Banking Ridwaan Loonat

The countdown to the launch of the SAREIT Sustainability Guide, in collaboration with Nedbank Corporate Investment Banking (CIB), has officially begun. The guide will be a vital resource for property professionals and investors focused on sustainable development, offering actionable strategies to improve ESG performance in real estate. It reflects SA REIT and Nedbank CIB's commitment to promoting positive change in the property sector. Stay tuned for updates! bit.ly/4g7uhs0 #SAREITSUSTAINABILITYGUIDE #NEDBANKCIB #REITS

The JSE Listed Property Index has risen consistently in recent months, driven by positive sentiment in South Africa, the formation of the Government of National Unity, and inflation supporting interest rate cuts. Institutional investors, including the Public Investment Corporation, have increased their investments in South African-listed property, with capital in balanced or multi-asset funds also on the rise. In the US, Cushman & Wakefield notes that the Federal Open Market Committee's decision to lower the federal funds rate by 50 basis points signals positive momentum for commercial real estate. REITs are rebounding, often leading private sector pricing due to daily trading that provides real-time investor sentiment insights. Since October 2023, the All-Equity REIT index has risen by 30%, while office REITs have increased by 39%. Emira Property Fund reported that its U.S. retail portfolio, comprising 12 grocery-anchored, value-oriented open-air power centres, has maintained a low vacancy rate of 3.6% since March. #JSEProperty #ListedPropertyIndex #REITS #InterestRates #RetailCentres

According to MSCI, global commercial real estate showing signs of recovery from the slowdown caused by rising interest rates. Sales activity is now on par with levels seen in 2023 and the decline in prices in the U.S. has begun to moderate. To advance its capital-light strategy, Burstone, a fully integrated real estate investor, fund, and asset manager with a diverse portfolio across South Africa, Europe, and Australia, has established a strategic partnership with Blackstone, the world’s largest alternative asset manager. Blackstone will acquire 80% of Burstone’s Pan-European Logistics (PEL) portfolio, while Burstone will retain a 20% co-investment and continue to manage the assets. This portfolio is expected to experience growth in net operating income, driven by favourable rental reversions and indexation. In Australia, Burstone’s investment in Irongate continues to perform well, benefiting from significant growth in assets under management. Additionally, Burstone's retail and industrial portfolios in South Africa are consistently generating strong growth in net operating income. #GlobalRealEstate #MarketRecovery #RealEstateInvestment #CapitalLightStrategy

The FNB Commercial Broker Survey for Q3 2024 identified industrial property stock shortages and a scarcity of smaller spaces as key factors affecting the sector's near-term outlook. REITs with high-quality portfolios that actively invest in their properties are achieving competitive rental rates. Redefine Properties reported that activity in the industrial market is driving improvements in operating metrics. The group focuses on prime industrial assets in desirable locations with easy access to national transport routes. To unlock intrinsic value, Redefine is redeveloping existing properties and developing new ones, including mini- and mid-warehouse units at Brackengate 2 in the Western Cape and S&J Sky Park in Gauteng. #IndustrialRealEstate #LogisticsProperty #WarehouseSpace John Loos