Hyprop Investments will focus on organic growth at its specialist retail centres in South Africa as well as actively seek new opportunities in Eastern Europe during the second half of its 2025 financial year, CEO Morné Wilken said Thursday.
The JSE’s REITs South African portfolio comprises centres such as Canal Walk, Somerset Mall, Hyde Park Corner and Rosebank Mall. In Croatia, it owns City Center One Zagreb East and City Center One Zagreb West; it owns Skopje City Mall in North Macedonia and The Mall in Sofia, Bulgaria.
Wilken, speaking in an online presentation at the release of financial results for the 6 months to December 31, said they were set for good growth in the second half and they also intended to recycle one of its South African assets, which he did not name, while a further focus would be to sell its Lango shares.
He said Hyprop was on track to meet the upper end of its distribution per share growth guidance of 4% to 7% for the year, and the dividend payout ratio might be increased further in the second half, this after it was already raised from 75% to 80% in the first half.
Hyprop reported 14.5% growth in distributable income to R765 million for the 6 months, following improved trading metrics at the centres in South Africa and in Eastern Europe.
Distributable income per share increased 14.4% to 201.4 cents. An interim dividend of 113.43 cents per share was declared, equal to 95% of the distributable income from the South African portfolio.
During the six months, management focused on the Somerset Mall expansion and the development of satellite offices around CapeGate Shopping Centre, on a leasehold basis with development partners SOM and Giflo.
At Canal Walk, Western Cape’s only super-regional, new concepts such as the first JD Sports in the country, the first stand-alone Silki store in South Africa, and the maiden flagship store for Shift Espresso Bar were introduced.
After rightsizing, the Edgars store on the first floor was trading “extremely well”, and the space it vacated was re-let to Jet, Home, Tech, Sleep, and another national tenant.
Somerset Mall was progressing on its two-year expansion to add 5 500 square metres of gross lettable area for 50 new stores. This expansion would continue to be a focus in the second half, said Wilken.
CapeGate’s initiatives to enhance shopper experience included an advanced audio system and improved signage. The roof was being refurbished to enable the installation of 5MW of solar panels.
Meanwhile, at Table Bay Mall, acquired in October 2023, the centre management team was strengthened and further organic opportunities would be sought in the second half, said Wilken.
In Gauteng, Rosebank Mall introduced several unique concepts and completed various projects, including upgrades for Tap & Go/Apple Pay at all pay stations and the control room, as well as the installation of e-hailing screens in the waiting areas.
A new Checkers FreshX store is under construction at Hyde Park Corner and is scheduled to open in July 2025.
Clearwater Mall, Woodlands, and The Glen opened several new stores, all enhancing each centre’s tenant mix.
Net property income from the South African portfolio increased by 18.6% (10.7% excluding Table Bay Mall) over the first half of the 2025 financial year.
Hyprop recently sold its sub-Saharan Africa portfolio to Lango Real Estate for shares, and Hyprop had been released from debt on the portfolio. The balance sheet reflects a steady loan-to-value ratio at 36.3%.
Wilken said they saw many growth opportunities in Eastern Europe, but they would not likely seek opportunities in the countries where a dominant group was already in the retail property market, such as MAS in Romania and Nepi Rockcastle in Poland.
In the past six months, the group saw strong demand for space in the four Eastern European centres, reflected in the very modest 0.2% vacancy rate.
City Center One West completed an extension and upgrade of its food court, introducing five new restaurants, while City Center One East, The Mall, and Skopje City Mall attracted several high-profile tenants.
At Skopje City Mall, Cineplexx renovated its cinema halls and successfully launched M House, a new roastery café, enhancing the food court’s offering.
Distributable income from the Eastern Europe portfolio increased by 34% to R308m, despite the rand strengthening by 4% against the euro.
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