UPDATE Presented by Neil Schloss Head of Asset Management Retail - - PowerPoint PPT Presentation

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UPDATE Presented by Neil Schloss Head of Asset Management Retail - - PowerPoint PPT Presentation

Nov 02, 2023 427 likes •776 views

Retail update November 2019 GROWTHPOINT RETAIL UPDATE Presented by Neil Schloss Head of Asset Management Retail 28/29 November 2019 INDEX 1. RETAIL OVERVIEW AND THEMES/ TRENDS 2. GROWTHPOINT TRADING DENSITY GROWTH VS BENCHMARK 3.

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Retail update November 2019

GROWTHPOINT RETAIL UPDATE

Presented by Neil Schloss Head of Asset Management Retail

28/29 November 2019

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INDEX

1. RETAIL OVERVIEW AND THEMES/ TRENDS 2. GROWTHPOINT TRADING DENSITY GROWTH VS BENCHMARK 3. TRADING PERFORMANCE 4. RETAIL PORTOLIO KPI’S 5. ARREARS 6. OPERATING COSTS 7. IMPACT OF COMPETITION 8. PROJECTS / DEVELOPMENTS 9. DISPOSALS 10. EDCON EXPOSURE

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RETAIL OVERVIEW

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RETAIL OVERVIEW GLA

  • No. Retail Properties

Vacancy 1,381,997m² 49 3.9% Value R29.8bn

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Top 10 Properties by Value Fair Value Rm GLA m² Top 10 Tenants by gross rental GLA m²

Brooklyn Mall and Design Square (75%), Brooklyn, Pretoria 2 125 56 334 The Foschini Group Ltd 58 922 Festival Mall, Kempton Park, Johannesburg 1 754 82 754 Edcon Holdings Ltd 104 377 N1 City Mall (100%), Goodwood, Cape Town 1 741 63 397 Pepkor Holdings Ltd 72 001 Waterfall Mall, Rustenburg 1 628 49 883 Shoprite Holdings Ltd 135 297 Greenacres, Greenacres, Port Elizabeth 1 485 49 530 Pick n Pay Stores Ltd 112 897 Vaal Mall (66.6%), Vanderbijlpark, Johannesburg 1 386 44 029 Mr Price Group Ltd 56 647 Lakeside Mall, Benoni 1 346 65 355 Truworths International Ltd 32 070 La Lucia Mall, La Lucia, Durban 1 304 37 287 Woolworths Holdings Ltd 87 253 Kolonnade (50%), Montana Park, Pretoria 1 173 38 284 Massmart Holdings Ltd 65 715 The Constantia Village, Constantia, Cape Town 1 135 20 421 Clicks Group Ltd 27 344 Sub Total 15 077 507 274 Sub Total 752 523 Balance of the sector 14 768 874 723 Balance of the sector 576 242 Total for the sector 29 845 1 381 997 Total for the sector (excluding vacancies) 1 328 765

TOP 10 PROPERTIES TOP 10 TENANTS

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  • 8. Decision making slow
  • 7. Runaway administrative costs
  • 11. Sustainable initiatives
  • 1. Weak Consumer
  • 2. Low like for like

turnover growth

  • 3. Historic lease

escalations outpacing turnover growth

  • 4. Aggressive lease/

renewal negotiations

  • 5. Cost containment
  • Reversions
  • Downsizing
  • Consolidation of stores
  • 6. Op Costs growing

faster than rental income

  • 9. Changing tenant mixes /alternative

uses

THEMES / TRENDS

  • 10. Online
  • 12. Technology
  • 13. Exclusivities
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GROWTHPOINT TRADING DENSITY GROWTH VS BENCHMARK

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Bellows College

GROWTHPOINT TRADING DENSITY GROWTH VS BENCHMARK

1.9% 3.0% 3.3% 6.8% 0.6% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% Growthpoint Redefine Liberty two°Degrees Attacq Hyprop June 2019 June 2019 May 2019 August 2019 September 2019

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Trading Performance

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Bellows College

TRADING PERFORMANCE

12 MONTH ROLLING TRADING DENSITY BY CENTRE CLASSIFICATION – SEPTEMBER 2019

2,616 2,442 2,497 3,467 2,733 2,537 3,602

  • 500

1,000 1,500 2,000 2,500 3,000 3,500 4,000 Total Large Regional Small Regional Community

Growthpoint MSCI

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Bellows College

TRADING PERFORMANCE

12 MONTH ROLLING TRADING DENSITY BY LSM – SEPTEMBER 2019

2,616 2,241 2,453 3,434 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 Total Portfolio Lower Income Middle Income Upper Income 1.9%↑ 2.1%↑ 1.0%↑ 1.9%↑

City Mall Village Square Festival Mall Golden Acre

The Bridge Fourways Crossing Kolonnade Vaal Mall Woodmead Key West N1 City Mall Northgate Greenacres Lakeside Mall 14th Avenue Helderberg Hyper Hillcrest Corner Howard Centre Bayside Mall Paarl Mall River Square Waterfall Mall Longbeach Mall Alberton City City View East Rand Value

Constantia Village Gardens Centre Brooklyn Mall La Lucia Mall Walmer Park Watercrest Mall

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Bellows College

TRADING DENSITY GROWTH ROLLING 12 MONTHS TO SEPTEMBER 2019 – LARGE REGIONAL

  • 0.1
  • 0.7

3.1 3.8

  • 2.4

3.2 0.7 1.4

  • 2.8

7.1

  • 1.0
  • 4.0
  • 2.0

0.0 2.0 4.0 6.0 8.0 BROOKLYN MALL FOURWAYS CROSSING KOLONNADE VAAL MALL WOODMEAD FESTIVAL MALL KEY WEST N1 CITY MALL NORTHGATE GREENACRES LAKESIDE MALL Percentage %

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Bellows College

TRADING DENSITY GROWTH ROLLING 12 MONTHS TO SEPTEMBER 2019 – SMALL REGIONAL

2.6 0.6 4.0

  • 3.1

3.9 3.8

  • 0.9
  • 2.2
  • 0.7

2.0

  • 0.2
  • 4.0
  • 3.0
  • 2.0
  • 1.0

0.0 1.0 2.0 3.0 4.0 5.0 LA LUCIA MALL WALMER PARK WATERCREST MALL BAYSIDE MALL PAARL MALL RIVER SQUARE WATERFALL MALL LONGBEACH MALL ALBERTON CITY CITY VIEW GOLDEN ACRE Percentage %

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Bellows College

TRADING DENSITY GROWTH ROLLING 12 MONTHS TO SEPTEMBER 2019 – COMMUNITY CENTRES

2.9 1.2 0.0 5.5 3.1 2.5

  • 0.1
  • 1.0

0.0 1.0 2.0 3.0 4.0 5.0 6.0 CONSTANTIA VILLAGE GARDENS CENTRE HILLCREST CORNER HOWARD CENTRE CITY MALL THE BRIDGE VILLAGE SQUARE Percentage %

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Bellows College

RETAIL PORTFOLIO KPI’S

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RETAIL PORTFOLIO KPI REVIEW

3.3 2.6 3.6 3.6 3.9

0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5

FY15 FY16 FY17 FY18 FY19 7.37 7.26 7.2 7.03 6.93

6.7 6.8 6.9 7 7.1 7.2 7.3 7.4 7.5

FY15 FY16 FY17 FY18 FY19 3.5 4.4 4.3 4.1 4.8 FY15 FY16 FY17 FY18 FY19

VACANCY % AVERAGE IN FORCE ESCALATION % WEIGHTED AVERAGE LEASE PERIOD Years

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RETAIL PORTFOLIO KPI REVIEW

87.0 89.3 80.9 81.8 82.7

76.0 78.0 80.0 82.0 84.0 86.0 88.0 90.0

FY15 FY16 FY17 FY18 FY19 7.73 7.36 7.27 7.09 6.54 FY15 FY16 FY17 FY18 FY19

RENEWAL SUCCESS RATE WEIGHTED AVERAGE RENEWAL GROWTH WEIGHTED AVERAGE FUTURE ESCALATIONS ON RENEWAL % % %

5.68 5.87 3.18

  • 3.12
  • 5.31
  • 6
  • 4
  • 2
2 4 6 8

FY15 FY16 FY17 FY18 FY19

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ARREARS

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ARREARS

8.84% 8.98% 10.33% 10.20% 9.15% 10.91% 13.42% 15.72% 17.17% 6.90% 8.14% 8.52% 9.06% 35,240 37,349 42,623 41,461 38,497 44,225 55,377 66,722 74,623 30,822 37,331 34,455 37,267 9,757 10,626 11,987 10,440 10,427 8,693 8,463 8,780 8,623 8,489 11,387 11,600 10,043

  • 10,000

20,000 30,000 40,000 50,000 60,000 70,000 80,000 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% Sep'18 Oct'18 Nov'18 Dec'18 Jan'19 Feb'19 Mar'19 Apr'19 May'19 Jun'19 Jul'19 Aug'19 Sept'19 Total Arrears and Provision for Arrears (R'000) Arrears as % of Total Collectables Arrears as % of Total Collectables Total Arrears (R'000) Provision for Bad Debt (R'000)

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Bellows College

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OPERATING COSTS

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Bellows College

TOTAL MUNICIPAL CHARGES CONTRIBUTED 62% OF TOTAL OPERATING COSTS

Source: SAPOA, MSCI

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Bellows College

MUNICIPAL CHARGES NOW A LARGER SLICE OF A LARGER PIE

Source: SAPOA, MSCI

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Bellows College

RATES & TAXES THE FASTEST GROWING COST SINCE 2009

Source: SAPOA, MSCI

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IMPACT OF COMPETITION

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IMPACT OF COMPETITION

1. Bayside Mall

▪ Competition – Table Bay Mall – Opened September 2017 ▪ Full Competition in Primary Catchment Area

  • 30%
  • 25%
  • 20%
  • 15%
  • 10%
  • 5%

0% 5% 10% 15% 20% Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Month-on-Month Trading Density Growth Month-on-Month Growth in Footcount

Opened Sep 2017

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PROJECTS / DEVELOPMENTS

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PROJECTS / DEVELOPMENTS

Development/ Redevelopment Tenancy Estimated Completion Date Capex Approval (Rmil)

COMPLETED PAST 4 YEARS

Vaal Mall Extension 12/2016 294.00 Greenacres Extension 07/2017 290.00 Fourways Crossing Refurbishment and Extension 06/2017 57.50 Northgate (50%) Downsizing of the 22 000m2 Pick n Pay Hypermarket to accommodate a new flagship Pick n Pay 10/2017 43.5 Kolonnade (50%) Development of outdoor piazza accommodating casual dining 12/2017 16.00

APPROVED

River Square Refurbishment and relocation of Tenants 12/2018 65.00 Festival Mall Refurbishment 04/2019 58.15 Lakeside Mall Refurbishment 04/2019 55.00 Walmer Park Redevelopment 06/2019 148.64 La Lucia Refurbishment 11/2019 65.5 Longbeach Mall Refurbishment 10/2019 34.00 Middestad Mall Redevelopment of upper level 03/2020 23.7 Lakeside Mall Cinema Redevelopment 06/2020 74.00 Waterfall Mall Dischem Development 04/2020 72.00

PLANNED

Paarl Mall Extension Longbeach Mall Extension

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DISPOSALS

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DISPOSALS

DISPOSALS – PAST 4 YEARS No BUILDING AREA DATE OF DISPOSAL GLA m² SELLING PRICE Rm

1 Picbel Parkade KZN 02/03/2017 13,818 271.3 2 Vaal Mall – 11.19% Vanderbijl Park 11/04/2017 7,387 209.3 3 Grayston Shopping Centre Sandton, JHB 22/05/2017 4,346 138.0 4 OK Bazaars Empangeni Empangeni, KZN 18/07/2017 13,660 172.5 5 Jet Bloemfontein Bloemfontein 26/09/2017 5,516 38.3 6 Hatfield Plaza Hatfield, PTA 19/03/2018 19,332 285.3 7 Hatfield Mall Hatfield, PTA 19/03/2018 6,332 61.4 8 Campus Building Hatfield, PTA 19/03/2018 3,179 39.0 9 Standard Plaza Hatfield, PTA 19/03/2018 2,733 32.0 10 Norkem Mall Kempton Park, JHB 20/12/2018 9,591 109.5 11 Longbeach vacant land Noordhoek, WC 04/10/2018 8.5 12 Sunward Park Shopping Centre Boksburg, JHB 19/07/2019 15,015 147.0 13 Stanger KZN 08/10/2019 3,045 16.8

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EDCON EXPOSURE

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EDCON EXPOSURE – BY BRAND

BRAND EXPOSURE AS AT 30 JUNE 2019 GLA (m²)

Accessorize 18 Active 1,511 Boardmans 1,266 CNA 7,759 Edgars 72,436 Jet 14,478 Jetmart 5,837 MAC 66 Red Square 645 River Island 361 104,377 30 June 2018 116,636

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EDCON EXPOSURE – EDGARS BY SIZE

EDGARS EXPOSURE AS AT 30 JUNE 2019

GLA (m²) NUMBER OF STORES < 3,000m² 14,212 8 3,000m² - 5,000m² 30,328 9 > 5,000m² 27,896 4 72,436 21

BY GLA NUMBER OF STORES

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THANK YOU