SA’s listed property sector continues to demonstrate resilience, but high interest rates and a constrained macroeconomic environment remain a drag on performance, according to an industry report.
The SA listed property overview for the September quarter by Golden Section Capital Equity Research found that solid fundamentals across the board are being overshadowed by the Reserve Bank’s decision to keep interest rates at “restrictive levels” — even as global central banks edge closer to monetary easing.
“The tension between strong property fundamentals and a tight monetary policy environment will continue to shape the sector’s performance,” the report adds.
While listed property counters have largely managed to sustain dividend payouts, Golden Section notes that valuations remain compressed — a condition it attributes in part to the Bank’s cautious stance.
The review notes that the month of September presented a clear contradiction: the reporting season delivered overwhelmingly strong operational results and positive forward guidance across the sector, yet the SA Listed Property Index recorded its first negative month of the third quarter, slipping 1%.
The tension between strong property fundamentals and a tight monetary policy environment will continue to shape the sector’s performance.
Golden Section Capital MD Garreth Elston, said the key points from the reporting season include strong operational performance, stable or rising distributions, firm occupancy levels and broadly positive management guidance for 2026.
“Logistics and industrial holdings continue to benefit from secular demand — with a few blips — while necessity retail has proven its resilience and continues to deliver strong results,” Elston said.
“Many companies have proactively refinanced debt, extended maturity profiles, and maintained gearing at manageable levels,” he added.
Notwithstanding the Bank’s mandate to protect the value of the rand and support sustainable growth, Elston noted that prevailing conditions — inflation being well within the Bank’s target, a relatively stable rand, and global peers easing their policy stance — the Bank had space to cut rates but had chosen not to.
“In doing so, it risks undermining growth and strangling sectors like property, which continue to show solid fundamentals despite the tough environment,” he said.
Notable developments in September include Accelerate Property Fund selling its office property at 73 Hertzog Boulevard for R68m to Amrichrop Properties. The group also resolved its long-standing litigation regarding Covid-19 business interruption claims, settling for R82.5m — representing its 50% share of the disputed amount.
Elsewhere, trading in Assura shares were suspended on October 3, pending the cancellation of its listing after it is acquired by Primary Health Care Properties.
Attacq reported a solid set of results for the to end-June 2025, underpinned by rental growth, disciplined cost management, and continued delivery at its flagship Waterfall City development.
The group also announced a board reshuffle, with Ipeleng Mkhari set to take over as chair after the group AGM, following Pierre Tredoux’s confirmation he won’t be available for re-election.
Burstone, via its joint venture with Australian fund manager Irongate, continued to scale its offshore industrial platform, acquiring a manufacturing facility in Glendenning. The deal includes two warehouses acquired for A$39m at an initial yield of 5.3% and a reversionary yield of 6.6%.
On the capital raising front, Dipula Properties successfully concluded an oversubscribed accelerated bookbuild in September, raising R559m — above its initial R500m target — through the issuance of 102.9m new shares at R5.43 each.
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