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property sector confidence grows

Vukile pre-close trading update for year ended 31 March 2025

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Vukile Property Fund closes a transformative year and forecasts accelerating growth

Vukile Property Fund (JSE: VKE), the leading specialist retail real estate investment trust (REIT), delivered a strong pre-close trading update for its financial year ended 31 March 2025, underscoring its dealmaking dexterity, strategic expansion and robust operational delivery. Vukile confirmed it is on track to meet its full-year guidance of 2% to 4% growth in funds from operations (FFO) per share and 6% growth in dividends per share (DPS).

Reflecting strong business momentum and high-quality earnings, Vukile also provided preliminary guidance on FFO and dividend per share growth for FY26 of at least 6%, based on conservative assumptions and without anticipating any need for new equity capital.

The transformative year has been underpinned by strategic execution. Driven by disciplined dealmaking and decisive capital deployment, Vukile’s gross asset value now exceeds R50 billion.

Through its 99.5%-held Spanish subsidiary Castellana Properties, Vukile grew its asset base in Spain and Portugal by nearly 60%. It exited its investment in Lar España at an impressive profit of EUR82 million, swiftly redeploying capital to acquire the iconic Bonaire Shopping Centre in Spain’s Valencia province at a compelling cash-on-cash return of over 8%, avoiding cash drag and securing sustainable earnings from a top-quality asset.

Adding a new engine of growth to its strategy, Vukile entered Portugal with four high-quality retail acquisitions. A fifth deal is well advanced and already fully funded.

All-in-all, the Iberian portfolio grew around 60% over the 12 months, cementing Vukile’s dominant position across two of Europe’s strongest economies − Spain and Portugal. Approximately two-thirds of Vukile’s assets and 60% of earnings are now offshore.

In South Africa, Vukile acquired a 50% stake in Mall of Mthatha (formerly BT Ngebs) in May 2024, where early turnaround performance has exceeded expectations. The mall’s vacancy rate has decreased dramatically from 18% to just 1.8%.

These assets were acquired at a favourable point in the cycle, expanding Vukile’s footprint and growing its Iberian portfolio with strategically aligned, high-performing assets that are delivering strong cash flows with further upside through targeted asset management.

“We’ve come through a phase of explosive growth. Now, we’re focused on integration, optimisation and crystallising value from these assets. Vukile remains open to opportunities but will prioritise deepening value within its current footprint, and for the time being we don’t expect to raise capital,” confirms Laurence Rapp, CEO of Vukile Property Fund.

Operational strength has stood out across Vukile’s portfolio of high-performance, strategically located shopping centres, with limited exposure to new competition and strong pricing power.

In South Africa, like-for-like net property income (NPI) grew 6.4%, vacancies remain below 2%, and 84% of rental reversions were positive or flat.  The portfolio has recorded growth in both sales and footfall. The cost-to-income ratio reduced to 15%, with ongoing progress in solar and water initiatives enhancing sustainability metrics and efficiencies.

In the Iberian portfolio, like-for-like NPI increased by almost 2% and with various value-add projects now complete, significant upward momentum can be expected in the year ahead. Vacancies in both portfolios remain below 2%. Positive rental reversions were a standout 23.6% in Spain and 6.15% in Portugal. Sales grew 4.3% in Spain and 6.7% in Portugal.

“With a well-hedged balance sheet, minimal near-term debt expiries of just 2% maturing in FY26 and strong liquidity, Vukile is closing FY25 in an exceptionally positive position,” says Rapp.

Vukile Property Fund will report results for the full year to 31 March 2025 on 17 June 2025.

 

Growthpoint delivers half-year results ahead of expectations

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Growthpoint delivers half-year results ahead of expectations and upgrades outlook to positive growth for full year

Growthpoint Properties Limited (JSE: GRT) delivered stronger-than-expected results for its six-month interim period ending 31 December 2024, reporting distributable income per share (DIPS) of 74.0cps, up 3.9% from HY24, while maintaining its distribution payout ratio at 82.5%.

In line with the first-half performance, Growthpoint upgraded its DIPS guidance for the financial year ending 30 June 2025 from -2% to -5% to positive growth of 1% to 3%, which will be driven mainly by the continued improvement in the operational performance of the South African (SA) portfolio, better finance cost expectations and continued outperformance from the V&A Waterfront. The stronger performance evident in the half-year results will moderate slightly for the full year.

Norbert Sasse, Group CEO of Growthpoint Properties, comments, “Growthpoint has done well to deliver strong results while effectively executing our strategic priorities, streamlining international investments through the disposal of Capital & Regional pls C&R) and further strengthening our SA portfolio. This progress was reflected in the improved performance of the SA portfolio. Additionally, disciplined treasury management kept finance costs below expectations, stringent cost control enhanced efficiency, and again, the V&A Waterfront outperformed.”

Financial Performance

Growthpoint delivered solid results despite ongoing macroeconomic pressures. The total dividend per share (DPS) for HY25 is 61.0cps, a 3.7% increase from HY24. Total property assets stand at R155.2bn, reflecting a decline of 11.2% during the six months, mainly due to the strategic disposal of C&R to optimise the international investment portfolio.

The Group SA REIT loan-to-value (LTV) ratio decreased to 40.8% from 42.3% at FY24, mainly due to the disposal of C&R. The interest cover ratio (ICR) was unchanged at 2.4x. Growthpoint retains strong liquidity, with R0.8bn in cash and R5.2bn in unutilised committed debt facilities and enjoys excellent access to funding at attractive margins. Increased finance costs in SA, stemming from higher average borrowings compared to HY24, were offset by a lower weighted average cost of debt in HY25 of 9.2% (HY24: 9.6%).

“Interest rate pressures have started to ease, although the pace of future reductions is still unclear. Growthpoint remains committed to balance sheet resilience for the long term, underpinning our ongoing access to competitive funding and maintaining financial flexibility,” notes Sasse.

Strategic Priorities

Growthpoint has a diversified portfolio and defensive income streams. It successfully advanced the company’s strategic initiatives during the period aimed at improving the quality of its SA portfolio, including enhancing sustainability initiatives across its core assets toward the goal of carbon neutrality by 2050, and optimising its international investments.

Improving the quality of its directly held SA portfolio of logistics and industrial, office and retail properties, Growthpoint is focused on disposals, developments and targeted investments. Over the past decade, it has trimmed asset numbers in the portfolio by 28%, from 471 to 341, reducing gross lettable area by 14.7%, thereby improving the quality of its portfolio and income streams. In HY25, Growthpoint disposed of a dozen properties for R589.4m at a R7.4m profit to book value and invested R945.4m in development and capital expenditure.

As a result of its portfolio enhancement since FY15, Growthpoint has strategically grown its logistics and industrial assets from 15% to 20% of the total SA portfolio value while increasing its exposure to modern logistics warehouses and better performing nodes. It also reduced its office exposure to 40% from 46% of portfolio value, enhancing quality by selling B- and C-grade assets. Retail property assets stayed stable at 39% of the total portfolio value, even while disposing of assets that are below Growthpoint’s optimum size or in deteriorating central business districts. Growthpoint has invested in extensive redevelopments and upgrades at all its long-hold shopping centres.

Optimising its international investments, Growthpoint’s group-wide strategic and capital allocation review to simplify its business and focus on core assets resulted in it disposing of its entire shareholding in C&R to NewRiver REIT (NRR), effective 10 December 2024. The transaction proceeds of 62.5pps, split between 31.25pps (R1.16bn) cash and 31.25pps equivalent in NRR shares, resulted in Growthpoint taking a R1.22bn or 14.2% investment in NRR. Growthpoint used the cash proceeds to settle debt.

Growthpoint continues to evaluate all options to maximise the value of its investment in NRR as well as for its 29.6% investment in Globalworth Real Estate Investments (GWI), where Growthpoint continues to support management at a shareholder level with value unlock initiatives.

Its 63.7% investment in Growthpoint Properties Australia (GOZ) remains a core investment for Growthpoint.

Growthpoint owns 37.5% of Lango Real Estate Management Limited valued at R341.0m. Lango has however internalised its asset management function at an expense of USD60.3m and Growthpoint will receive preference shares equivalent to the value of its investment. In addition, Lango has been redomiciled to the UK. Growthpoint’s 15.8% investment in Lango UK is now classified as an international investment, and it is no longer included in Growthpoint Investment Partners (GIP).

South African Portfolio

In SA, Growthpoint owns and manages a R67.3bn diversified core portfolio of retail, office, logistics and industrial, and trading and development properties, representing 50.8% of Growthpoint’s total asset book value. This portfolio contributed 50.1% of DIPS.

The SA business enjoyed an improved contribution from all three sectors, including like-for-like rental growth, lower negative rent reversions, occupancy gains in the logistics and industrial portfolio and improved expense efficiencies and recoveries.

For the three sectors, gross property income increased by R98.0m, while expenses declined by R68.0m, driving a R166.0m or 6.2% uplift in net property income (NPI). Reduced loadshedding lowered expenses, especially in the office portfolio, and together with stringent cost management, decreased the SA business’s total expense ratio to 35.4% (HY24: 37.8%).

Comparing HY25 to HY24, the SA portfolio saw further occupancy gains, reducing vacancy rates from 9.2% to 8.3%, while rental renewal growth continued an encouraging trend, moving from -7.1% to -1.8%. The combination of higher occupancy and improving rental renewal growth propelled like-for-like NPI growth from negative 0.1% to an impressive positive 6.8%.

The overall improvement in property metrics was positive for SA property values, which increased 1.4% in the six months, driven by Growthpoint’s portfolio improvements and more favourable market conditions. Growthpoint’s Cape Town and KwaZulu-Natal portfolios are outperforming across all three sectors.

The SA logistics and industrial portfolio is well let, with a low vacancy rate of 3.5% (FY24: 5.2%). Its latest speculative developments at Phase 1 of Arterial Industrial Estate and Centralpoint in Samrand, where 9,541sqm was leased post reporting date, are now both fully let. Portfolio improvements and better overall sector dynamics saw like-for-like NPI grow 3.5% during the six months. Property valuations increased 1.5%. Renewal rental growth entered positive territory, lifting from -3.3% at FY24 to 0.9% over the six months.

Modern logistics properties make up around half of this portfolio’s gross lettable area, and this is increasing with new speculative developments such as the 21,831sqm Phase 2 of Arterial Industrial Estate. Two of the six units in this phase, where construction is nearing completion, are already let.

The SA retail property portfolio like-for-like NPI increased by 6.1% over the six months, reflecting improved overall portfolio quality, constant letting, a higher renewal growth rate and more effective recoveries for on-site solar electricity. The portfolio value increased by 1.4% during the period. Its core vacancy is a low 4.4% (FY24: 4.0%). Growthpoint’s shopping centres achieved strong trading density growth of 3.8% (FY24: 4.1%) and increasing shopper footfalls.

The key redevelopment of Bayside Mall was completed as planned. Growthpoint installed solar photovoltaic panels at seven shopping centres in the six months. Additionally, the R113m redevelopment and upgrade of Beacon Bay is on track for completion in June 2025. At Watercrest Mall, the introduction of a new Shoprite and relocation of Checkers is in progress. Growthpoint is actively exploring and finding solutions for stubborn retail vacancies, and, during the period, it agreed to sell Golden Acre and pivoted the retail mix at Northgate by introducing Shoprite as a new anchor to open in April 2025 and identified a portion of the mall for subdivision and sale. It successfully reduced vacancies at Brooklyn Mall and is contemplating various solutions for the remaining 9,300sqm of vacancy, which is mainly in the offices and two deep stores.

The SA office property portfolio continued to benefit from the sector’s recovery. Like-for-like NPI increased 9.4%, driven by consistent letting and an improved renewal growth rate, which moved up from -14.8% to -6.9% during the half year. Less loadshedding, efficient management of expenses and good recoveries were also positive factors. Stabilised portfolio vacancy levels stayed within the 15% range at 15.9% (FY24: 15.1%). Gauteng represents 72.1% of office portfolio GLA, which showed marginally decreased vacancies at 19.1% (FY24: 19.3%). The office portfolio printed a 1.3% increase in value.

Growthpoint completed the 154-room Canopy by Hilton hotel in its Longkloof mixed-use precinct in Cape Town, where it is also progressing the net-zero carbon redevelopment at 36 Hans Strydom for Ninety One under a 15-year lease for completion in July 2025.

Sustainability highlights achievedduring the period include Growthpoint’s Meadowbrook Estate facility for Serra becoming SA’s first industrial property to earn a prestigious 6-Star Green Star Existing Building Performance (EBP) rating from the Green Building Council South Africa (GBCSA), setting a new benchmark for logistics and industrial properties. The company’s installed solar capacity reached 52.46MWp (HY24: 40.7MWp), already exceeding its FY25 target of 50MWp, and its milestone Power Purchase Agreement (PPA) for 195GWh of renewable, green electricity will begin powering its revolutionary e-co2 solution at 10 Sandton office buildings in FY26, after nearly two years of innovation and preparation. The e-co2 scheme provides Growthpoint tenants access to wheeled renewable hydro, wind and solar electricity at cost-saving fixed escalations while reducing carbon emissions and generating tradeable carbon credits.

SA Trading & Development earned R48.9m (HY24: R20.3m) of trading profits and R5.4m (HY24: R4.0m) of NPI, but no development fees (HY24: R8.0m). Growthpoint’s in-house Trading & Development division develops assets for its own balance sheet as well as for third parties and GIP.

The V&A Waterfront

Growthpoint’s 50% interest in the V&A Waterfront in Cape Town has a property value of R12.4bn, which makes up 9.3% of Growthpoint’s total asset book value and contributed 15.8% to DIPS. Once again, the V&A delivered stellar returns, benefiting from increased tourism and retail activity. Like-for-like NPI rose 16.6% for the six months, with the precinct being fully let. It successfully opened the repurposed Union Castle Building in December 2024. Major projects remain on track, including the Table Bay Hotel’s conversion to the Intercontinental Table Bay Cape Town and the fully let luxury retail wing at Victoria Warf.

The V&A’s hotel, residential and leisure NPI increased by 37%. With the addition of The Commodore Hotel and The Portswood Hotel, the V&A now has three hotels (587 keys) operating under management agreements. Income from hospitality businesses, where the V&A enjoys both the rewards and risks of the operating business as opposed to pure rental, increased to 17% of operating profit earned, up from 10% in HY24.

Growthpoint Investment Partners

Growthpoint’s alternative real estate co-investment platform, GIP, is 1.9% of Growthpoint’s total asset book value and contributed 3.6% to DIPS. It now includes two funds distinct from Growthpoint’s core assets. They are Growthpoint Student Accommodation Holdings, operating under the Thrive Student Living brand, and Growthpoint Healthcare Property Holdings. GIP closed the period with R8.4bn of assets under management, split equally between SA healthcare and student accommodation.

International Investments

Growthpoint continues to optimise its international investment. On 31 December 2024, 37.9% of property assets by book value were located offshore, and 30.5% of its DIPS was generated offshore. Foreign currency income of R769.0m remained at a similar level toHY24.

GOZ, which invests in high-quality industrial and office properties in Australia, accounts for 23.8% of Growthpoint’s total assets by book value and contributed 21.2% to its HY25 DIPS. Despite increasing its payout ratio from 79.8% (HY24) to 95.2%, GOZ’s distribution decreased from AUD9.65cps (HY24) to AUD9.1cps. An additional AUD2.1cps was distributed to compensate for the increased dividend withholding tax, which nearly doubled from 9.8% (HY24) to 18.3%. Growthpoint received a R533.2m net distribution from GOZ (HY24: R551.2m).

GOZ maintained its strong balance sheet and reduced its gearing from 40.7% to 39.7%. The directly owned GOZ portfolio performed well, with occupancy remaining high at 94% (FY24: 95%) and a 6.0-year weighted average lease expiry. The period marked numerous strategic capital highlights for GOZ, including divesting its non-core holding in Dexus Industria REIT for AUD131.7m and establishing the AUD198 million Growthpoint Australia Logistics Partnership (GALP) with TPG Angelo Gordon holding 80%. GOZ also launched the Growthpoint Canberra Office Trust (GCOT), which acquired a AUD90 million high-yielding, primarily government-leased, A-Grade office building in Canberra’s CBD. As a result, GOZ’s funds management business enjoyed strong momentum over the six months.

GWI, which invests in offices and mixed-use precincts in Poland and in Romania where it also develops logistics parks, represents 11.3% of Growthpoint’s total assets by book value and a 5.1% contribution to DIPS. GWI’s dividend of EUR7.5cps (R129.1m) for HY25 was 31.8% down from 11.0cps (HY24: R146.1m), negatively impacted by higher interest rates on its Eurobond refinance, which is also expected to soften Growthpoint’s dividend income from this investment for the full year. GWI maintained a strong balance sheet with gearing at 38.1%.

GWI achieved like-for-like NPI growth of 7.0%, with portfolio vacancies reducing to 13.3% (FY24: 13.8%). Disposing its 50% share in the joint venture industrial portfolio was the main factor contributing to the 5.4% portfolio value decrease to EUR2.6bn. GWI continues to invest in its portfolio, including its current refurbishment of the 48,000sqm Renoma mixed-use property in Poland. It completed and leased 5,900sqm of the Craiova Logistics Hub in the period.

NRR, which invests in retail properties in the UK and which Growthpoint acquired as part of its C&R disposal, accounts for 0.9% of Growthpoint’s total assets by book value and with C&R contributed 3.8% to its HY24 DIPS. NRR declared a dividend of 3.0pps, translating to R38.8m for Growthpoint for the six months ended September 2024. In addition, R57.0m funds from operations from C&R to 10 December 2024 are included in the distributable income.

Lango, which invests in prime commercial real estate assets in key gateway cities across the African continent (excl. SA), accounts for 1.9% of Growthpoint’s total assets by book value and made a 0.4% contribution to DIPS. In HY25, Lango finalised the acquisition of USD200m of assets from Hyprop Investments Limited and Attacq Limited, and Growthpoint received R11.0m dividend income from Lango.

Looking Ahead

Growthpoint’s SA portfolio has stabilised, with key metrics improving across all three sectors.

“We continue to see positive momentum across the portfolio, underpinned by operational resilience and strategic execution. This is supported by the improved sentiment in the country under the Government of National Unity, along with the improving interest rate environment,” says Sasse.

Growthpoint aims to execute R2.8bn in strategic non-core SA asset sales for the full financial year, further improving the quality and sustainability of its property income, albeit at a lower overall quantum. Despite temporary closures in some areas due to major projects underway, the V&A Waterfront is on track for mid-single-digit growth for the full year. The reduction in finance costs will continue to benefit the business going forward.

On the international front, elevated capital costs, both domestically and globally, continue to constrain investment growth.

“As interest rates ease and economic conditions improve, we remain well-positioned to drive long-term value for our stakeholders,” concludes Sasse.

Redefine navigates uncertainty with focus on organic growth

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Redefine Properties (JSE: RDF) announced in its pre-close investor update for the half-year ending 28 February 2025 that its earnings outlook has stabilised despite a challenging operating context, driven by a focus on efficiency and strong demand for quality assets.

The company reported that its South African portfolio achieved a net operating profit margin of 77.8%, while EPP, its directly owned Polish retail property platform, improved its margin from 66.4% to 71.7%. This led to a consolidated group net operating profit margin of 75.9%.

Redefine CEO Andrew König highlighted that the global path to economic normalisation has been disrupted by changes in US policy under President Donald Trump, which introduced uncertainty around interest rates and inflation. “The stage is now set for a shallow easing cycle, and rates may not reach the levels we previously expected. While European interest rates continue to trend downward, escalating geoeconomic tensions cloud the 2025 outlook. To sustain growth in valuations, we cannot rely solely on interest rate movements. Our strategic focus remains on organic income growth, as this will drive value creation in the current market.”

Looking ahead, Redefine’s strategy is focused on disciplined capital allocation, the sale of non-core assets to reduce its loan-to-value ratio, restructuring joint ventures to enhance visibility of income streams, whilst delivering income growth. König noted that commercial real estate transactional activity is on the rise, which will support the company’s plans to offload non-core assets, with growing interest in the market.

Despite the disruption caused by the delayed national budget speech, König pointed to two promising initiatives from the National Treasury: efforts to remove South Africa from the greylist by October and the restoration of the country’s investment-grade credit rating. “This is critical for our business, as Redefine’s Moody’s rating was downgraded alongside South Africa’s. A reversal of this could improve access to international debt markets, and the delayed budget may even help with these efforts.”

 Green shoots in the SA portfolio

 Redefine’s South African portfolio has demonstrated solid performance, particularly in the industrial and retail sectors, which drove a 1% increase in overall occupancy since August 2024. Additionally, 80% of renewals were completed at stable or increased rental terms, a positive indicator of growth.

The industrial sector has proven especially resilient, with occupancy rising to 97.6%, alongside positive rental reversions in a competitive market. “The industrial sector continues to be one of our strongest performers, and we see potential for further growth if capital availability allows us to expand,” said Leon Kok, Redefine’s COO.

Conversely, the office sector remains challenged by excess supply and limited demand, except in select nodes. A significant lease renewal resulted in a -17% renewal reversion during the period. However, Redefine mitigated this impact through strong leasing activity in other locations, such as the Western Cape and Sandton, which benefit from proximity to the Gautrain. “Demand is focused on high-quality assets, and our active asset management ensures our portfolio remains well-positioned to attract this limited demand,” Kok added.

Sustainability commitments

 Redefine is making notable strides towards its sustainability goals, with an ambition to become the most sustainable property company by 2030. The company plans to expand its renewable energy capacity by 47%, with an anticipated 17% of energy consumption coming from renewable sources by year-end. Additionally, Redefine has achieved a 38% reduction in greenhouse gas emissions across its European portfolio, further solidifying its commitment to environmental sustainability.

The company also received recognition from Sustainalytics, earning three badges, including being ranked the 16th most sustainable global real estate company, the only South African REIT to place among the top 50 worldwide.

Growth in Poland

 While South Africa faces ongoing challenges, Poland’s economic growth has benefited from European interest rate cuts and social grants that have boosted household spending and retail conditions. EPP’s core properties have seen impressive occupancy levels of 99.3%, with rental reversions rising from 0.2% to 1.5%. The rent-to-sales ratio remains well below 9%, indicating healthy tenant affordability.

Redefine is pursuing a strategy of selling non-core assets and restructuring joint ventures in Poland to reduce complexity and lower the see-through LTV. “We are exploring options to simplify our joint ventures to either exit or fully own them,” König explained.

 Strong cash generation

 Redefine’s financial position remains strong, with a liquidity profile of R6.4 billion as of November 2024. The company has also proactively managed its debt profile, including the FY25 maturities that are progressing well on the back of improved liquidity levels in the capital markets. As of February 2025, Redefine’s weighted average cost of debt decreased to 7.2%, providing some relief amid global inflationary pressures.

Ntobeko Nyawo, Redefine’s CFO, emphasised, “Our focus continues to be on generating organic growth from our existing portfolio, maintaining a strong balance sheet, and weathering the current economic cycle. We are positioning the company to capture opportunities in high-quality assets, while ensuring strong cash generation to support our dividend payouts.”

Looking ahead: Living the upside

Redefine enters 2025 with a focus on “living the upside,” aiming for sustainable, long-term value creation. König concluded, “While some macroeconomic factors, including US policy shifts, remain unpredictable, we are confident in our ability to create our own upside and deliver on our strategic goals.”

Despite macroeconomic challenges, the company is maintaining its earnings guidance for FY25, with distributable income per share expected to be between 50 and 53 cents.

 

 

 

Growthpoint delivers Longkloof Precinct heritage development

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Growthpoint Properties (JSE: GRT) has delivered the multi-year, multi-million-Rand revitalisation of the historic Longkloof precinct, creating a uniquely Capetonian urban gem.

The precinct redevelopment was thoughtfully curated by Growthpoint, South Africa’s leading real estate investment trust (REIT), in a heritage-led project to inject new life into the Longkloof Precinct. The multifaceted project involved the renovation of several Growthpoint-owned buildings and the creation of an attractive public square at their heart, which connects to the city via four different access routes.

“Growthpoint’s vision was to reimagine six buildings — made up of a historical school and an industrial building with its boiler room — and a vacant parking lot as a hip and vibrant mixed-use precinct that embodies Cape Town’s essence in something new and exciting, yet respectful of its heritage,” says Wouter de Vos, Growthpoint’s Regional Head: Western Cape.

This flagship precinct exemplifies Growthpoint’s commitment to enhancing the city’s built environment​ through urban renewal with quality assets. Its low vacancy rate, below 2%, reflects its desirability in Cape Town’s thriving real estate market.

Work on the precinct began in 2019 after several years of painstaking planning and most elements were completed by 2021. The 21,164sqm multi-use property has become a desirable address for innovative, creative and entrepreneurial businesses. Major office tenants include Travelstart, Mushroom Media and Workshop17. Longkloof is also the fifth Cape Town location of WorkAgility, Growthpoint’s pioneering agile ready-to-occupy office concept, which eliminates traditional office costs and complexity and can be secured for periods as short as one year.

The final hospitality and retail elements were originally planned to open in 2021 but were delayed by the Covid-19 lockdowns and the subsequent period of global and local uncertainty, and now complete and are coming to life around the precinct.

“Five years after the start of the pandemic, the resilience of the Cape Town market is undeniable, with an upswing in international tourism since mid-2023, together with ongoing ‘semigration’ from other parts of South Africa to the Western Cape,” highlights de Vos.

The 154-room Canopy by Hilton Cape Town Longkloof Hotel is the first of its kind in Africa and incorporates the façade of the former MLT House, the structure of which has been carefully preserved and integrated into the new design. The hotel entrance leads from Longkloof’s public open square – Longkloof Square – with newly curated retail and social spaces that enhance the precinct’s connectivity and community focus.

De Vos says the hotel is the perfect complement to the mix of uses and tenancies in the Longkloof precinct. “We are proud to welcome Canopy by Hilton to South Africa, which brings fresh, dynamic energy to the city’s hospitality scene, and captures the character, culture and creative charm of its location.”

This thoughtfully designed Canopy by Hilton Cape Town Longkloof hotel blends upscale comfort with the charm of Cape Town’s rich cultural tapestry, featuring custom art pieces that reflect the neighbourhood’s creative spirit, articulated in a Cape Malay colour palette, and inspired by fynbos, the ocean and nearby Bo-Kaap on different floors. With its prime Longkloof location, historical setting, and deep connection to local culture, the precinct offers seamless access to major landmarks and public transport, while the hotel delivers everything you expect from Canopy by Hilton—authentic connections, stylish design, and a vibrant social atmosphere.

Andreas Lackner, Vice President Operations, Africa & Indian Ocean, Hilton, says, “We are delighted to start welcoming guests to the much-anticipated Canopy by Hilton Cape Town Longkloof and are proud to be the centrepiece of the iconic precinct. We congratulate our partners at Growthpoint for completing the development of Longkloof, revitalising the historic precinct with this world-class hotel, an attractive public square and more. The neighbourhood is set to be a destination in its own right, and we are pleased to be at the heart of it.”

Growthpoint has devoted specific attention to ensuring the right retail mix for the precinct, with only a few signs left to hang above its restaurant windows and storefronts. “In keeping with the intention to ensure that Longkloof Square is a destination and meeting point for the local community, we have sought out a mix of food and fashion that is unique to Cape Town. The retail premises are deliberately tailored to create a boutique environment with diversity and interest and will open over the next two months, and we’re excited to share these details soon,” says de Vos.

The retail is on ground level fronting Park Road, extending into Summit Lane and spilling into the square. Each shopfront expresses the identity of its occupant through a mix of timber finishes and different window choices, adding to the charm of the precinct’s distinctive red-brick facades and quirky industrial interiors.

Not all developments can be done with this degree of time and patience, but a heritage-focused project of this nature is an exception. “There is certain value in more difficult developments,” says Neil Schloss, Growthpoint’s Head of Asset Management SA. “The fact that they are hard to do, and there are few property investors who have the capacity to take them on, gives them scarcity and, given the right project, this creates greater value.”

“We are extremely pleased with what has been achieved with the redevelopment of the historic Longkloof precinct and we fully believe that it enhances its surrounds and the city, as well as the Growthpoint portfolio of property assets,” he continues. “This is a new gem to be discovered in Cape Town and aligns perfectly with Growthpoint’s strategy of creating assets that have value and growing relevance into the future.”

Growthpoint R2bn-plus mixed-use development in Sandton

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Growthpoint announces R2bn-plus mixed-use development in Sandton Summit

Growthpoint Properties Limited (JSE: GRT), South Africa’s leading real estate investment trust (REIT), today announced it is commencing a landmark residential and retail development, Olympus Sandton, in partnership with leading luxury residential developer Tricolt.

Olympus Sandton will be situated in the mixed-use Sandton Summit precinct, anchored by the Discovery Head Office on the corner of Rivonia Road, where Katherine Street becomes Sandton Drive. This strategic investment aligns with Growthpoint’s vision to create South Africa’s premier walkable mixed-use precinct, capitalising on Sandton’s status as Africa’s leading financial district.

Growthpoint has been rolling out different elements of the Sandton Summit vision for over a decade now, and Olympus Sandton is its first development positioned to capture the increased demand for residential property in Sandton Central.

The R2bn-plus Olympus Sandton development will comprise two towers. The first residential tower of 26 storeys will be the first phase of the development along Rivonia Road. It will include a premium dining experience from Marble Hospitality Group on one of the tower’s upper floors, as well as its extraordinary Pantry convenience retail offering in Grade-A ground floor retail space. The second phase is a tower of at least 16 storeys, located east of the first.

The sale of the development’s more than 400 residential apartments by Tricolt has commenced and will launch to the public on 27 February 2025, with prices starting from R1.49 million. Together Growthpoint and Tricolt will retain ownership of the two retail sections of the tower. Construction of Olympus Sandton is estimated to start in the latter half of 2025.

Sandton Summit is situated at the crest of Sandton Ridge, which is the highpoint of the area. Olympus Sandton’s 26-storey tower, although not the tallest building in the area, will become the highest in Sandton, offering unmatched views across Johannesburg and beyond.

Neil Schloss, Head of Asset Management South Africa at Growthpoint Properties, says: “We believe that commencing the Olympus Sandton development is well-timed for the reawakening of the powerhouse that is Sandton Central, and aligned with its accelerated transformation into a vibrant neighbourhood as it evolves with the trend of people wanting to live closer to workplaces and amenities, to offer an exceptional mix of residential, office, retail and other types of properties.”

Timothy Irvine, Growthpoint’s Head of Asset Management for Offices, adds, “Sandton is experiencing a significant revival. After years of office downsizing, companies are now maintaining their physical presence and even starting to grow it again as return-to-office becomes standard practice. Vacancy rates in Growthpoint’s office portfolio are declining nationwide, with Sandton — the country’s cosmopolitan business capital — showing the start of a particularly promising recovery. Despite a slow initial post-pandemic resurgence, the district is adapting not only its office spaces to meet growing demand but its entire lifestyle, with more living and gathering spaces.”

Growthpoint is among those leading Sandton Central into an even more vibrant future. Taking advantage of other opportunities arising from increased demand for residential property in Sandton Central, in line with the trend of living closer to offices, Growthpoint also recently sold its 151 on 5th building in Sandton to a residential developer. Growthpoint is also investing in taking Sandton into a new green era with its revolutionary e-co2 solution launching at 10 Sandton office buildings in mid-2025. The e-co2 scheme will provide tenants with access to wheeled renewable hydro, wind and solar electricity at fixed escalations, sharing the benefits of Growthpoint’s milestone Power Purchase Agreement (PPA) for renewable energy, with which it secured 195GWh of green power.

This is one of several projects Growthpoint is undertaking that will make Sandton Central even more friendly for people, businesses and the environment.

Olympus Sandton’s striking and innovative design matches its prominent position on the Sandton skyline. It was created through collaboration between Australian architectural practice ClarkeHopkinsClarke (CHC) and one of South Africa’s foremost architectural studios, dhk Architects, and will be developed jointly by Growthpoint and Tricolt – all award-winning leaders in their fields.

Growthpoint’s development team has an established record of excellence in investment-grade commercial property development, which also extends to a signature range of residential developments. This includes its Riverwoods office-to-residential conversion to BlackBrick Bedford, various award-winning purpose-built student accommodation developments, and its recently completed major residential development, the fully sold-out The Kent, La Lucia, in KwaZulu-Natal.

The design of Olympus Sandton incorporates advanced sustainable building practices, including post-tension slabs and smart energy management systems, aligning with Growthpoint’s environmental, social and governance (ESG) commitments, including its 2050 carbon-neutral goal. The Olympus Sandton development will target at least a 4-Star Green Star rating from the Green Building Council of South Africa (GBCSA).

“Pedestrianised mixed-use precincts have tremendous environmental benefits, particularly when they are so well located, by reducing carbon emissions as a result of less private vehicle travel and traffic. Olympus Sandton is the next step in bringing our vision for Sandton Summit to life and delivers on our commitment to creating sustainable developments that deliver exceptional amenities for their uses and long-term value for our stakeholders,” says Schloss.

The best-known mixed-use asset in Growthpoint’s investment portfolio is the iconic V&A Waterfront, of which Growthpoint is a 50% owner. It also owns several other precincts and parks in its South African portfolio, such as the Longkloof precinct in Cape Town’s vibrant Kloof Street area of Gardens. Spanning 21,164sqm, this multi-use property has become a sought-after address for innovative, creative and entrepreneurial businesses, alongside the 154-room Canopy by Hilton hotel, the first in South Africa, which is set to open in late January 2025. In the vibrant Umhlanga Ridge New Town Centre, its three Green Star-rated office developments – Lincoln On The Lake, Mayfair On The Lake and The Boulevard – all offer a mix of P-grade office accommodation, ground floor retail and basement parking linked by a central landscaped courtyard with pedestrian access, and overlooking the gardens of a local park.

“Olympus Sandton exemplifies Growthpoint’s strategic approach to unlocking maximum value from prime real estate assets through thoughtful market-aligned development that improves our portfolio and progresses our sustainability goals,” notes Schloss.

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