UK back on property buying lists
There’s renewed interest in British property but analysts warn of further pain this year for mall owners
SA investors are slowly but surely starting to climb back into UK-focused property stocks, which have been out of favour since Britain announced its exit from the EU in mid-2016. Analysts agree that it is becoming hard to ignore the value proposition created by the stronger rand and the substantial discounts to NAV at which a number of the JSE’s 12-odd real estate counters, with 100% or partial UK exposure, are trading. For instance, former market darlings Covent Garden owner Capital & Counties Properties (Capco) and retail play Intu Properties are both trading around 52% below their 2016 share price highs. That places the two companies at a discount to NAV of around 15% and 35% respectively. Hammerson, which listed on the JSE in September 2016 and is the sector’s largest UK-focused property offering, offers a 36% discount to NAV. Hammerson and Intu plan to merge later this year, which will create the UK’s largest shopping centre fund. With a combined market cap of around R115bn, th...
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