Octodec Investments suffered one of its worst financial periods in the year to August, growing its dividends by a measly 0.8%.

This was just under the 1% growth in dividends it achieved in a six-month period in 2009.

MD Jeffrey Wapnick said the second half of the August 2017 financial year was disappointing as the group faced new competition in Pretoria, particularly in Hatfield, which was being redeveloped. The economy was weak and consumers were under pressure, Wapnick said.

Octodec is a real-estate investment trust with a portfolio of 315 properties, valued at R12.8bn. It focuses on Johannesburg and Pretoria central business districts (CBDs).

It also owns various convenience shopping centres scattered across Gauteng, including Woodmead Value Mart and Killarney Mall.

The group’s portfolio realised like-for-like growth of 5.3% in rental income during the reporting period. But Wapnick said the company should be able to achieve strong dividend growth in two years’ time, once various projects had come on line.

Executive director at Meago Asset Management Anas Madhi said: "CBD residential is under strain with abundant supply, faltering demand and distressed consumer[s] driving rental streams down, while rising construction costs are making new developments increasingly yield-dilutive."


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