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SA REITs pull back 12.3% in March

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SA REITs pull back 12.3% in March as geopolitical conflict unsettles global markets

Sector fundamentals hold firm as geopolitical uncertainty weighs on sentiment, while distribution growth climbs to 9.43% and index broadens with three new entrants

South African real estate investment trusts (REITs) gave back their early-year gains in March, declining 12.3% as the geopolitical conflict drove oil prices higher, weakened the rand and reignited inflation concerns across emerging markets. The pullback left SA REITs down 4.3% for the first quarter of 2026.

According to the latest SA REIT Association Chart Book for March 2026, compiled by Ian Anderson, Head of Listed Property and Portfolio Manager at Merchant West Investments, the decline was broad-based. Only Octodec (+4.4%), Oasis Crescent (+3.8%) and Fairvest A (+2.2%) ended the month in positive territory. Equities and bonds also came under pressure, with the All Share Index down 10.5% and the All Bond Index down 6.8%.

“The pullback in March was a valuation reset driven by geopolitical risk, not a deterioration in underlying fundamentals,” says Anderson. “Rolling 12-month distribution growth improved to 9.43% and 12-month total returns remain strong across much of the sector. This looks more like a period of market de-risking than a reflection of weakening company performance.”

The geopolitical conflict and its impact on real estate investment trusts

The geopolitical conflict that started on 28 February 2026, weighed heavily on global markets throughout March. The primary transmission mechanism to real estate is through oil prices and their effect on inflation and interest rates. Brent crude rose above $100 a barrel for the first time since 2022, peaking at around $119.50 a barrel on 9 March.

Joanne Solomon, Chief Executive Officer of the SA REIT Association, says the sector’s resilience should not be underestimated despite the turbulence. “The geopolitical conflict has introduced significant short-term uncertainty for all asset classes, not just real estate investment trusts. However, our sector enters this period of volatility from a position of strength, with improving distribution growth, healthier balance sheets and a broadening investable universe. The fundamentals that drove the sector’s remarkable recovery over the past two years remain firmly in place.”

Globally, real estate investment trust prices declined an average of 12.5% in March, according to data from Quoted Data. However, historical analysis suggests that geopolitical events tend to produce short-term volatility rather than lasting damage. Across 40 major geopolitical events spanning 85 years, equity markets lost an average of 0.9% in the first month but recovered to gain 3.4% over the following six months. LaSalle Investment Management noted that real estate should remain relatively resilient given the ability of the asset class to pass through inflation into cash flows.

For South Africa, the conflict has complicated the macroeconomic outlook. The rand weakened more than 5% over the month, while economists anticipate inflation will accelerate as higher oil prices filter through to fuel costs. The South African Reserve Bank’s rate-cutting cycle has been paused, though the duration of the conflict will ultimately determine the extent of the fallout.

Solomon adds: “South Africa is a net energy importer and rising oil prices feed directly into our inflation basket. However, what differentiates real estate investment trusts is their ability to deliver income that grows over time. With distribution growth approaching 10%, the sector offers a meaningful hedge against the very inflation pressures that are causing concern.”

Company results highlight operational strength

Despite the correction in share prices, March’s company announcements painted a constructive picture of the sector’s operating performance. Growthpoint reported half-year distributable income per share growth of 2.3% and dividend per share growth of 8.5%, with South African vacancies improving to 7.2%. Hyprop delivered distributable income growth of 12.9% and reiterated guidance for the upper end of its full-year forecast.

Vukile announced that its subsidiary Castellana will acquire a 50% stake in Barcelona’s Splau Shopping Centre for EUR 175 million, while its pre-close update showed South African net operating income up 10%, vacancies at just 1.7% and positive rental reversions of 3.5%. Burstone launched a pan-European light industrial joint venture with Hines, seeded with six assets acquired for more than R760 million.

Among the mid-cap counters, Fairvest indicated it is tracking toward the upper end of its 9% to 11% distributable earnings guidance, while Spear reported occupancy of approximately 97%, cash collections above 99% and R1.08 billion of acquisitions completed during the period. Texton’s interim results pointed to a cleaner, more focused platform, with South African net operating income up 4% and continued expansion in self-storage.

“The results season has been broadly constructive,” Anderson notes. “Improving vacancies, better income growth, active capital recycling and a widening opportunity set across both larger and smaller counters confirm that the weakness in March was market-driven rather than fundamental.”

Index broadens as Dipula, Octodec and Spear join benchmark

One of the most significant structural developments in March was the inclusion of Dipula, Octodec and Spear in the FTSE/JSE All Property Index and the SA REIT Index, effective 23 March 2026.

Solomon says the inclusion is a meaningful milestone for all three association members. “It reflects the growing depth of South Africa’s real estate investment trust universe. In addition, it creates a more representative benchmark for investors across strategies, including index-tracking and specialist REIT funds.”

Anderson adds: “Index inclusion generally improves visibility, strengthens institutional relevance and can support additional demand from benchmark-aware investors. It is a meaningful sign that the SA REIT market is deepening beyond its traditional large-cap core.”

Outlook

Looking ahead, the trajectory of the geopolitical conflict remains the key variable for near-term market sentiment. The duration of hostilities and whether the energy price increase passes through into core inflation will largely determine the pace of recovery. Should the geopolitical conflict move toward a real resolution, normalising oil prices and renewed confidence in the interest rate outlook could provide meaningful upside for real estate investment trust valuations across both local and global markets.

“The next phase of returns is likely to be driven more by execution than by multiple expansion,” Anderson concludes. “Funds with resilient retail and logistics exposure, disciplined leverage and credible capital allocation are well positioned. Distribution growth is improving, operating metrics are trending in the right direction and lower finance costs should continue to support earnings. March was a reminder that sentiment can shift quickly, but the investment case for SA REITs over the medium term remains compelling.”

Highlights from the SA REIT Chart Book March 2026

– SA REITs’ total return (March): -12.3%
– All Share Index (March): -10.5%
– All Bond Index (March): -6.8%
– Year-to-date return: -4.3%
– Distribution growth (rolling 12 months): 9.43%
– Top monthly performers: Octodec (+4.4%), Oasis Crescent (+3.8%), Fairvest A (+2.2%)
– 12-month performance leaders: Octodec (+67.7%), Redefine (+55.4%), Heriot (+54.9%)
– Index inclusion: Dipula, Octodec and Spear joined the FTSE/JSE All Property Index and SA REIT Index

 

The SA REIT Association Chart Books are available for download here.

Inside the sold-out SA REIT Conference

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Global shockwaves, local momentum: Inside the sold-out SA REIT Conference

A month on from the sector’s marquee gathering, the message is clear: South African REITs have shifted from survival mode to strategic growth. And the world is watching.

When the SA REIT Association convened its annual conference on 12 February 2026 at The Venue, Houghton Hotel in Johannesburg, every seat was taken. The sold-out event, proudly sponsored by Nedbank Corporate and Investment Banking’s Property Finance Division, drew the full spectrum of listed property decision-makers. Master of Ceremonies Michael Avery set the day’s tone early: This was a sector with its confidence back.

A month later, that confidence has been validated. According to the latest SA REIT Association Chart Book for February 2026, compiled by Ian Anderson, Portfolio Manager at Merchant West Investments, the sector surged 8.1% in February alone, pushing total market capitalisation past R350 billion for the first time. Year-to-date returns stand at 9.1% and distribution growth across the sector is running at 8.06% on a rolling 12-month basis.

The conference programme, opened by SA REIT Association Chairman Estienne de Klerk, spanned macroeconomics, regulatory reform, investor sentiment, global REIT dynamics and the political landscape ahead of the 2026 local elections. Here are the key themes that emerged.

A world through the looking glass

Prof Adrian Saville, Founding Director of Boundless World, opened with a sweeping assessment titled “Global Shockwaves, Local Crossroads.” Drawing on Lewis Carroll’s Through the Looking-Glass, Saville framed 2026 as a year in which familiar rules have been rewritten. “The real question is how do we prepare to thrive in a world that has stepped through a looking glass,” he told delegates.

Amid the volatility, Saville identified three constants. First, business drivers remain unchanged: real GDP growth continues to correlate tightly with corporate revenue and earnings. Second, the fundamental growth drivers of nations – savings and investment, demography, policy quality, education, health and openness – are powering a dramatic eastward shift in global economic gravity, with BRICS now accounting for 36.2% of global GDP on a purchasing power parity basis, overtaking the G7 at 29.1%. Third, sources of competitive advantage are resilient: Businesses that combine agility with deep shock-absorbing capacity consistently outperform.

On South Africa, Saville’s assessment was nuanced. Two further rate cuts were expected in 2026, before the USA/Israel/Iran war muddied the waters, inflation is low and stable, and the rand was trading lower against USD. Progress on grey list removal, Eskom stabilisation and Vulindlela reforms is tangible. Yet growth remains below population growth, youth unemployment and inequality are entrenched and manufacturing’s share of GDP has fallen from 22% in 1980 to just 11.2% by 2024.

Clearing the roadblocks: The B4SA reform agenda

Martin Kingston, Executive Chairman of Rothschild & Co South Africa and Chair of the B4SA Steering Committee, delivered a detailed reform progress report. Approximately 160 CEOs from companies with a combined market capitalisation exceeding R11 trillion have committed to addressing the country’s structural challenges across energy, transport, crime and youth employment.

On energy, loadshedding days have plunged 98% from 290 in 2023 to just seven in 2025. Eskom’s energy availability factor improved from 56.6% to 63.5% and six gigawatts of new generation capacity came online. In transport, Transnet freight rail volumes are forecast to reach 171 million tonnes in FY25/26, up from 149 million tonnes two years earlier, with 11 new rail operators licensed. On crime and corruption, all 40 FATF recommendations have been completed and more than 500 officials trained in financial forensics. Business has donated over R180 million via the Resource Mobilisation Fund.

Kingston reserved urgency for Johannesburg, describing a city in decline with minimal capital expenditure, growing debt, entrenched corruption and the spectre of “Day Zero” service delivery failures. For property investors, the implications are direct: escalating rates and taxes and decreasing property values. He argued that Johannesburg is critical to the broader “SA Inc” narrative and that urgent national government intervention is required.

From headwinds to renewed momentum: The investor verdict

Independent property analyst Keillen Ndlovu delivered one of the conference’s most anticipated sessions, presenting his annual survey of 25 fund selectors. The headline finding was emphatic: in 2024, 48% of fund managers were underweight on the sector and only 12% were overweight. By early 2026, those positions had reversed. Just 12% remain underweight, while 40% are now overweight or neutral-to-overweight.

SA listed property delivered a total return of 30.6% in 2025, with 2024 having produced 29.8%. Prices have recovered above pre-COVID levels, though they remain below the 2017 peak. Critically, the 2026 earnings outlook is positive across virtually the entire sector: Heriot is guiding 10% to 15% growth, Hyprop 10% to 12%, Resilient above 10% and Vukile above 9%. Balance sheets have strengthened with falling loan-to-value ratios and rising interest cover. The sector raised over R11 billion in fresh equity during 2025 through oversubscribed bookbuilds, while listed property’s allocation in balanced funds has recovered to 4.2%, surpassing pre-pandemic levels.

“If you drive around Sandton and Rosebank today, the cranes are back,” Ndlovu observed. “The physical economy is matching the REIT sector’s recovery.”

Deal activity has been prolific. Ndlovu highlighted a string of transactions already in early 2026, from Discovery’s R4.05 billion acquisition of its Sandton headquarters to Vukile’s R5.2 billion Spanish retail parks deal, the GEPF’s R1.8 billion Century City purchase and Growthpoint’s disposal of its 55% share in Discovery Phase 1 for R2.32 billion. These moves reflect a sector where capital allocation is becoming increasingly strategic.

Among structural developments, the FTSE/JSE All Property Index is expanding from 23 March 2026 to include more stocks. In early March, the JSE confirmed the inclusion of Spear REIT, Dipula Properties and Octodec Investments in both the ALPI and the SA REIT Index, a development welcomed by the SA REIT Association as broadening the benchmark and reinforcing the depth of the sector.

Ndlovu also noted that Central and Eastern Europe and Iberia now play a major role in the local sector, with companies such as NEPI Rockcastle, Lighthouse Properties and Vukile deriving significant portfolio exposure from these regions. Looking forward, he identified multifamily residential, healthcare and student accommodation as the most likely new property sectors to list on the JSE. Sell-side analysts forecast total shareholder returns of 8.6% to 18% for 2026, with no sell recommendations.

South Africa: A global REIT world-beater

Peter Verwer, Executive Chairman of Futurefy, provided the international perspective, declaring that the world is entering a “REITs 4.0” era characterised by an expanding universe of property sectors, a truly global franchise and the use of REITs as strategic nation-building instruments.

Verwer positioned South Africa as a standout. Over the five years to January 2026, SA REITs delivered a 21% annualised total return in local currency, outperforming the United States (7.6%), Australia (8.4%), Japan (5.8%) and the United Kingdom (0.6%). South Africa’s REIT market capitalisation as a proportion of total commercial real estate value stands at 19%, second globally only to Singapore.

Globally, listed REITs have grown from 120 in 1990 to more than 1,000 by 2024, with traditional property types now comprising only 40% of the global index – healthcare, telecommunications, data centres and specialised sub-sectors make up the rest. Verwer argued that governments increasingly view REITs as infrastructure delivery tools. He cited case studies from India, Singapore and Mauritius and urged South Africa to leverage REITs as “nation-building apps” capable of supporting urbanisation and infrastructure delivery without burdening public debt.

The 2026 elections and the city-state imperative

Political analyst Dr Ralph Mathekga delivered a frank assessment of local government ahead of the 2026 municipal elections. His message was blunt:The threat of local government collapse is real, and South Africa’s democracy cannot be sustained without a functional local space.

Mathekga warned of deepening political fragmentation at the municipal level, with coalition dynamics delaying decision-making. Yet he framed this as part of a necessary evolution, with power decentralising away from national politics. His most arresting insight was his advocacy for a “city-state” model: “It matters more who is the mayor of your city than who is the president of your country,” he argued – a statement that resonated deeply with property professionals whose asset values are tied to municipal competence.

Momentum confirmed, vigilance required

The sold-out SA REIT Conference 2026 captured a sector at an inflection point. After years of headwinds, South African REITs have delivered two consecutive years of exceptional returns, seen their total market capitalisation breach R350 billion and are guiding for distribution growth well above inflation. Institutional investors are returning in force, capital markets are open and deal activity is robust. Internationally, as Verwer demonstrated, South African REITs are genuine world-beaters and the global REIT franchise continues to expand into new frontiers that present significant opportunity for this market.

Yet the conference’s most valuable contribution was its refusal to allow the good news to obscure the structural risks. Saville’s reminder that growth still lags population growth, Kingston’s warnings about Johannesburg, Ndlovu’s observation that even underweight managers now concede they got it wrong, and Mathekga’s assessment of local government fragility; these are the markers of a sector thinking honestly about what comes next.

As Anderson noted about the February Chart Book: “Investors will be watching whether improving earnings can justify current valuations as the market transitions from recovery to momentum.” That transition is well under way. The question now is how South Africa’s REITs will sustain it.

About the SA REIT Conference 2026

The SA REIT Conference 2026 was held on 12 February at The Venue, Houghton Hotel, Johannesburg, proudly sponsored by Nedbank Corporate and Investment Banking’s Property Finance Division. The SA REIT Association promotes SA REITs as an investment class both locally and internationally. For more information, visit sareit.co.za.

SA REITs start 2026 on constructive footing

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SA REITs start 2026 on constructive footing as improved sentiment drives sector ahead of sold-out conference

Distribution growth turns positive and balance sheets strengthen as sector momentum builds

South African real estate investment trusts (REITs) have maintained their positive trajectory into the new year, delivering a constructive performance in January 2026 as the sector prepares for its premier industry gathering next week.

According to the latest SA REIT Association Chart Book January 2026, the sector delivered a total return of 0.9% for the month. While lagging the broader equity market, with the All-Share Index rising 3.7%, the performance signals a continued stabilisation following an exceptional 2025.

Ian Anderson, Head of Listed Property and Portfolio Manager at Merchant West Investments and compiler of the monthly SA REIT Chart Book, notes the year has begun with renewed investor appetite for yield-sensitive assets.

“South African real estate investment trusts started 2026 on a constructive footing,” says Anderson. “The positive start to the year follows an exceptionally strong 2025 for the sector, underpinned by improving balance sheets, stabilising distributions and a gradual normalisation of funding conditions.”

Drivers of performance

January’s gains were primarily supported by share price appreciation rather than income, reflecting a shift in sentiment supported by easing inflation expectations and a more favourable global rates backdrop.

“From a macro perspective, sentiment was aided by a firmer rand, moderating local inflation and growing confidence that the South African Reserve Bank is set to cut interest rates further in 2026,” Anderson explains. “REITs continued to trade as a hybrid asset class, offering both defensive income characteristics and equity-like upside in an environment where economic growth remains subdued but stable.”

Company activity and divergence

Performance dispersion remains a key theme. While profit-taking weighed on some of 2025’s top performers, other counters surged ahead. Attacq (6.7%), Oasis Crescent (4.5%) and Redefine (4.0%) delivered solid gains, supported by improving operational metrics.

“REITs such as Attacq, Oasis Crescent, Redefine, Heriot and Growthpoint delivered solid positive returns, supported by factors including resilient retail footfall and ongoing cost containment initiatives,” says Anderson. “Over longer periods, the data continues to highlight a clear recovery trend across most of the sector. Importantly, distribution growth has also turned positive on a rolling basis, signalling the recovery is increasingly being supported by underlying cash flows rather than valuation re-rating alone.”

Conference sold out as confidence returns

The sector’s renewed momentum is mirrored by unprecedented interest in the upcoming SA REIT Conference 2026, taking place next week Thursday, 12 February, in Johannesburg.

The sold-out event will see industry leaders gather to pressure-test strategies and chart the path forward. Proudly sponsored by Nedbank Corporate and Investment Banking’s Property Finance division, the conference features keynote speaker Peter Verwer on global REIT dynamics, alongside heavyweights such as strategist and economist Prof Adrian Saville and Attacq CEO Jackie van Niekerk.

“This is the room where the industry challenges assumptions and sharpens what comes next,” says Anderson. “The fact that the conference sold out early underscores the shift in the sector. We have moved beyond survival mode and are firmly back to discussing growth, data monetisation and the future of South African property.”

Outlook

Looking ahead, Anderson believes the sector is well-positioned, despite expected volatility.

“The sector enters 2026 in a far stronger position than in recent years. Balance sheets are generally healthier; asset quality has improved through active portfolio management and valuations remain compelling relative to both equities and bonds. The January data reinforces the view that SA REITs are once again positioned to play a meaningful role in diversified portfolios as income generation and capital growth prospects continue to normalise,” he concludes.

Highlights from the SA REIT Chart Book January 2026

  • SA REITs’ Total Return (Jan): 0.9%
  • All Share Index (Jan): 3.7%
  • Top Monthly Performers: Attacq (6.7%), Oasis Crescent (4.5%), Redefine (4.0%), Heriot (3.4%), Growthpoint (3.1%)
  • 12-Month Performance Leaders: Delta Property Fund (129.4%), Growthpoint (60.5%), Fairvest B (59.2%)
  • Yield Trends: Long bond yields remained range-bound, maintaining an attractive yield differential for SA REITs by historical standards.

The SA REIT Association Chart Books are available for download here.

SA REIT Conference 2026

The SA REIT Association will be unpacking global trends and the future trajectory of the local REIT sector at its highly anticipated, sold-out biannual conference next week Thursday, 12 February 2026 in Johannesburg.

The conference features Peter Verwer, a founding member of the Global Real Estate Alliance and a heavyweight in international property policy. His presence underscores the increasing integration of South Africa’s commercial property sector into the global fold.

 

SA REITs cap remarkable 2025 with 38.6% annual return

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SA REITs cap remarkable 2025 with 38.6% annual return as sector enters new year on firmer footing

Two-year rally delivers 88% cumulative gains as dividend growth returns to double digits

South African real estate investment trusts (REITs) delivered an outstanding 38.6% total return in 2025, building on their 35.8% performance in 2024 to complete two consecutive years of exceptional gains, according to the latest SA REIT Association Chart Book.

December saw the sector gain a modest 0.5% as markets wound down for the festive period, with limited news flow to drive prices. The stronger rand weighed on several geographically diversified REITs with substantial offshore investments. However, this quiet finish did nothing to diminish the sector’s stellar annual performance.

The year’s trajectory exceeded all expectations. After a challenging first quarter that saw the sector down 4.1%, SA REITs staged a remarkable recovery. By year-end, the fourth quarter alone delivered 21.5% as companies raised their distributable income guidance and dividend growth at sector level jumped to 10% year-on-year in the third quarter, having been at zero for the better part of three years.

Delta Property Fund was the standout performer, returning an extraordinary 105.3% for the year, followed by Fairvest at 62.9%. Heriot (49.9%), Vukile (48.3%), Growthpoint (47.6%) and Resilient (47.5%) also delivered impressive gains.

Over the past three and five years, South African REITs have comfortably outperformed both the local equity and bond markets, cementing their position as a compelling asset class for investors seeking income and growth.

Ian Anderson, compiler of the SA REIT Chart Book and Head of Listed Property at Merchant West Investments, comments: “At the start of 2025, very few analysts and market commentators could have envisioned just how successful 2025 would be for South African REIT investors. The end of loadshedding and more clarity on global tariffs helped boost investor sentiment towards the sector. At the same time, company management teams were becoming increasingly optimistic about the medium-term prospects for their businesses.”

Outlook

Following a strong recovery, South African REITs enter 2026 on firmer footing. While the exceptional capital gains of the past two years are unlikely to be repeated, the sector continues to offer compelling income yields, improving fundamentals and attractive relative value.

Anderson notes: “Total returns are likely going to be skewed towards income rather than capital gains. The outlook for dividend growth of between 5% and 8% per annum over the next two to three years is supportive of current valuations and likely to drive some capital appreciation in the medium-term.”

The macro backdrop for South African REITs has improved significantly, with lower interest rates, the end of loadshedding, removal from the financial grey list and a sovereign credit rating upgrade all contributing to a more favourable environment. These factors should result in higher capital flows, a lower risk premium and improved access to capital markets.

“All said, this should result in total returns of between 12% and 15% per annum over the medium-term, which is likely to be in line with the South African equity market and a lot higher than South African bond and money markets. For long-term investors, SA REITs should continue to play a valuable role as an income-oriented asset class, with opportunities for selective capital appreciation,” Anderson concludes.

The SA REIT Association Chart Books are available for download here.

SA REIT Conference 2026

The SA REIT Association will be unpacking global trends and the future trajectory of the local REIT sector at its highly anticipated biannual conference on 12 February 2026 in Johannesburg.

The conference will feature Peter Verwer, a founding member of the Global Real Estate Alliance and a heavyweight in international property policy. His keynote presence underscores the increasing integration of South Africa’s commercial property sector into the global fold.

Demand for the event has been unprecedented, mirroring the sector’s performance. The conference is sold out, however interested parties may join the waiting list via the SA REIT Association website here.