COMPANY COMMENT
Property sector hits a new low due to few new deals
The sector is suffering a ‘confidence crisis’ due to its poor earnings growth outlook
The fact that the JSE’s property sector has raised no more than R1.8bn in new capital in the year to date is a fresh reminder of how appetite for real estate stocks has shrunk. The figure is way less than the R14bn that flowed into the sector last year and only a fraction of the average R40bn-R50bn a year that property punters were prepared to fork out to support book builds, new listings, and mergers and acquisitions activity in the preceding four years.
The current lack of deal-making among the JSE’s 60 or so real estate counters follows last year’s overall 30% drop in share prices. The fall was led by a massive sell-down in the Resilient stable of companies following allegations of insider-related trading and share manipulation, most of which has since been refuted...
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