Arrowhead’s dividend slides as growing vacancies pose big problem
The property group is spending more to retain existing tenants and to lure new ones
Diversified South African-focused property fund Arrowhead reported a 15% decline in its full-year dividend to 74.1c a share on Wednesday, as a tough economy weighed on rental income. The Arrowhead property portfolio comprises a mix of retail (61%), office (31%) and industrial (8%) assets that are directly held, and provides indirect investment exposure to other commercial and residential assets through its separately listed subsidiaries, Gemgrow Properties and Indluplace Properties. Arrowhead also has investments in listed securities Rebosis Property Fund (16.42%) and Dipula Income Fund (8.6%). South African dividend growth in the property sector came under significant pressure in 2018 as the macroeconomic environment deteriorated, resulting in weakened income contributions from Arrowhead’s property portfolio and listed investments. “As a result of prevailing economic conditions, tenants continue to reduce space and work forces. Costs of retaining existing tenants and attracting new...
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