Fairvest, the owner of lower-end shopping centres in SA, is on track to deliver strong overall returns this financial year, says CEO Darren Wilder.
The company grew its dividend per share 9.53% to 9.806c in the six months to December, results showed on Thursday. The group’s guidance had been to grow distributions between 9% and 10%.
Fairvest has now achieved dividend growth close to or beyond 10% for five consecutive reporting periods.
Wilder said Fairvest stood out because it can meet shareholder expectations in good and bad economic cycles.
"Fairvest is a simple to understand property company and our goal is to provide our investors with consistent dividend growth. We don’t focus on growth for growth’s sake. We believe in this current environment that investors will appreciate a fund that meets its guidance," said Wilder.
Fairvest was the best performing locally invested property stock in 2017, achieving a total return of 16.39%, said Garreth Elston of Golden Section Capital. Property stocks that beat it had offshore exposure.
The Fairvest property portfolio is worth R2.8bn and consists of 43 properties. The portfolio grew 27.1% during the reporting period. Wilder said Fairvest was pleased with its results and it would continue to invest solely in SA.
"We understand the local market and feel in the long run our investors will achieve some of the best returns out of South African property through us."
Bridge Fund Managers chief investment officer Ian Anderson said Fairvest was an attractive investment. "Fairvest is one of our preferred exposures in the listed property sector. It has been building an impressive track record, which it was able to maintain in the first six months of this financial year.
"Forecast distribution growth of 9% to 10% puts it at the very top of the pile yet it still offers investors an extremely attractive 10% initial income yield."