Spear Reit lifts interim distribution due to positive leasing momentum
Total distributable income rose to R111.2m in the six months ended August from R90.99m a year ago
24 October 2024 - 09:17
by Jacqueline Mackenzie
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Western Cape-focused property fund Spear Reit has reported a 22.24% rise in distributable income at the halfway stage of its financial year.
Total distributable income rose to R111.2m in the six months ended August from R90.99m a year ago, the group said in a statement on Thursday.
Distributable income per share was up 2.06% to 41.61c and distribution per share was 3.1% higher at 39.53c.
During the first half, Spear’s management team remained focused on navigating the challenging trading environment and building on the rising tide of tenant activity year-to-date to actively drive down portfolio vacancies, in particular within its commercial portfolio, it said.
Despite the challenging trading environment, positive leasing momentum has been a hallmark of the first half of the 2025 financial year, Spear said, as material inroads were made in the overall vacancy rate of the portfolio and, in particular, the vacancy rate of the office portfolio.
More than 9,000m2 of commercial office vacancies were let, reinforcing the letting demand that has returned to the office market within the Western Cape, as Spear’s commercial office occupancy rates increased by 616 basis points.
“A general theme across the Western Cape real estate market has been a genuine sense of continued optimism while still retaining a strong dose of reality as large-scale capital investments continue to be rolled out by the public and private sector in the Western Cape creating much-needed employment and social upliftment,” it said.
Robust rental collections, growing letting activity, tenant retention and solid financial, debtors and vacancy management remained the key building blocks for the entire Spear team for the 2025 financial year.
As a result of aggressive marketing and letting initiatives, the core portfolio has seen occupancy levels improve to 95% in addition to Spear’s balance sheet remaining strong and well positioned for growth with an LTV of 23.93% before the implementation of the Emira transaction and the 100 Fairways Close disposal.
Spear said its portfolio is well placed to deliver on its strategic focus with the key drivers being strong return-to-office and letting momentum, semigration, localisation, commencement of an interest rate tapering cycle in SA, all of which will have cascading benefits to landlords and tenants alike as overhead cost pressures start to show signs of relief.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Spear Reit lifts interim distribution due to positive leasing momentum
Total distributable income rose to R111.2m in the six months ended August from R90.99m a year ago
Western Cape-focused property fund Spear Reit has reported a 22.24% rise in distributable income at the halfway stage of its financial year.
Total distributable income rose to R111.2m in the six months ended August from R90.99m a year ago, the group said in a statement on Thursday.
Distributable income per share was up 2.06% to 41.61c and distribution per share was 3.1% higher at 39.53c.
During the first half, Spear’s management team remained focused on navigating the challenging trading environment and building on the rising tide of tenant activity year-to-date to actively drive down portfolio vacancies, in particular within its commercial portfolio, it said.
Despite the challenging trading environment, positive leasing momentum has been a hallmark of the first half of the 2025 financial year, Spear said, as material inroads were made in the overall vacancy rate of the portfolio and, in particular, the vacancy rate of the office portfolio.
More than 9,000m2 of commercial office vacancies were let, reinforcing the letting demand that has returned to the office market within the Western Cape, as Spear’s commercial office occupancy rates increased by 616 basis points.
“A general theme across the Western Cape real estate market has been a genuine sense of continued optimism while still retaining a strong dose of reality as large-scale capital investments continue to be rolled out by the public and private sector in the Western Cape creating much-needed employment and social upliftment,” it said.
Robust rental collections, growing letting activity, tenant retention and solid financial, debtors and vacancy management remained the key building blocks for the entire Spear team for the 2025 financial year.
As a result of aggressive marketing and letting initiatives, the core portfolio has seen occupancy levels improve to 95% in addition to Spear’s balance sheet remaining strong and well positioned for growth with an LTV of 23.93% before the implementation of the Emira transaction and the 100 Fairways Close disposal.
Spear said its portfolio is well placed to deliver on its strategic focus with the key drivers being strong return-to-office and letting momentum, semigration, localisation, commencement of an interest rate tapering cycle in SA, all of which will have cascading benefits to landlords and tenants alike as overhead cost pressures start to show signs of relief.
mackenziej@arena.africa
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