SA’s listed property sector continues to feed investor appetite, having raised about R153bn in the past six years.
Stanlib’s head of listed property funds, Keillen Ndlovu, said his research showed that the sector had still grown strongly in 2016 despite a sluggish economy and a lack of merger and acquisition activity.
As much as R32bn had been raised in new equity in the year to date. This was slightly down from R36bn in 2015. The year before saw R40bn raised.
Included in 2016’s R32bn are the proceeds raised by Liberty group’s property listing, Liberty Two Degrees (L2D), earlier in December.
"Liberty raised R3.8bn; R2.8bn that was raised through institutions and R1bn raised directly by Liberty through its clients or policyholders," Ndlovu said.
L2D’s assets comprise portions of the Liberty Group’s R30bn property portfolio, including those of its biggest, most iconic properties: Sandton City, Eastgate, Nelson Mandela Square and Melrose Arch.
This was the first time that investors would be able to get exposure to these premium retail assets.
The sustained appetite for listed real estate could suggest that there may be more listings to follow next year, Ndlovu said.
Outside of the L2D listing, much of the R32bn was accounted for by offshore-based companies listing on the JSE.
These include the likes of the Polish developer and investor, Echo Polska Properties’ Eastern Europe-focused Globe Trade Centre and West Europe shopping mall owner Hammerson.
The FTSE 100 retail property powerhouse is the largest listed property company on the JSE.
When it listed in September, it had a market capitalisation of R91.6bn, and relegated Intu Properties, which owns shopping centres in the UK and Spain, to second spot in terms of JSE-listed property companies by market cap.
Intu’s market cap was R81.6bn at the time.
The SA Listed Property sector delivered a 4.29% total return accounting for income and capital growth to December 8 2016. Bonds, however, were the best performer with 14.96% returns.