Bruised property sector aims to improve internal regulation
The SA Reit Association has made suggestions about how to define key metrics to avoid abusive financial reporting
The SA Reit Association has released a new set of best-practice recommendations, as it tries to improve the reputation of the listed property sector. In 2018 the sector had its worst year in more than two decades following a number of allegations against a JSE property heavyweight, the Resilient group of companies. The association, which represents more than 20 JSE-listed real estate investment trusts (Reits), says the guidelines will be the accepted standard for reporting key metrics and are intended to make the analysis and comparison of different Reits easier. This would prevent people from inflating dividend growth to unsustainable levels, as well as underreporting the debt levels on property companies’ balance sheets.
Bram Goossens, chair of the tax and JSE committee of the association, said that since the Reit tax dispensation was still relatively new in SA, having only been introduced in 2013, it was natural that it would take time to establish internal governance meas...