GROWTHPOINT
RETAIL PORTFOLIO UPDATE
Standard Bank Investors Conference: 26 November 2014
Key Performance Indicators
VACANCIES
RETAIL PORTFOLIO VACANCY
GLA
904,467m²
VACANCY
38,793m²
Loss of potential Rental
4.29%
R4.7mil p.m.
TOP 15 (80% by value)
GLA
606,411m²
VACANCY
17,748m²
2.90%
VACANCY Excl. GLA UNDER DEVELOPMENT
11,868m²
1.96%
NEW FINALISED LETS
3,409m²
VACANCY BREAKDOWN
OFFICE GLA
10,574m²
UNLETTABLE/UNDER DEVELOPMENT
8,480m²
City View ex Action Cricket
Lakeside ex Nu Metro
River Square – Redevelopment
LETTABLE RETAIL GLA VACANT
19,739m²
2.2%
PROJECTED VACANCY MOVEMENT
CURRENT VACANCY
38,793m²
PROPERTY SALES IN PROGRESS
-8,756m² Arcadia, Norkem
NEW FINALISED LETTING
-4,240m²
CONFIRMED FUTURE MAJOR VACANCIES
693m² Rental greater than R100k/mth
ELLERINES IMPACT
2,872m² Effective 1/12
ELLERINES IMPACT
7,764m² Effective 1/4/15
ARREARS
October 2014
TOTAL COLLECTIONS
TOTAL ARREARS
LEGAL
DEPOSITS
COLLECTABLE ARREARS
Rand
226,707,467
23,062,468
9,268,345
2,609,911
11,184,212
%
10%
4%
1%
5%
PROVISION FOR BAD DEBTS
10,257,386
44%
ELLERINES COMPONENT
NATIONAL RETAILERS
RESTAURANTS/FAST FOODS
739,475
R7.3mil
R8.2mil
Section Heading
WRITE-OFF's AS % OF COLLECTIONS
Y-T-D
0.20%
2013/14 2012/13
0.20% 0.10%
LONG-TERM ARREARS TREND
ARREARS
Section Heading
ARREAS Y-o-Y
PROVISION FOR BAD DEBT Y-o-Y
LEASING
VACANCY MOVEMENTS : 1 July to 31 October
2014
Balance at 1 July 2014
GLA Adjustments
Disposals
Acquisitions
Extensions
Leases expired in the period
Renewals of expired leases
New letting of vacant space
Leases terminated
Balance at 31 October 2014
Section Heading
TOTAL RETAIL
GLA
907,604
-3,389
250
904,465
Renewal Success Rate
87.14%
Weighted Avg Renewal Growth (by Gross Rental)
6.40%
Average Renewal Lease Period
3.75 yrs
Weighted Avg. future escalations on renewals
7.31%
VACANCY
40,462
-4,232
250
42,613
-37,134
-10,907
7,741
38,793
4.46%
4.29%
PROPERTY INCOME
TYPICAL SMALL REGIONAL SHOPPING CENTRE INCOME GROWTH MODEL
GLA
Section Heading
NATIONAL ANCHOR COMPONENT
NATIONAL RETAILER COMPONENT
LINE SHOPS/FRANCHISEES
PERCENTAGE LEASES BY GLA EXPIRING PER ANNUM
SPLIT
80% IN FORCE LEASES - INCREASE IN INCOME
20% RENEWALS: INC INCREASE
Assumptions:
No vacancy movement
No rent-free periods
35%
35%
30%
20%
2.75%
ANCHORS
6.06%
10%
15%
20%
25%
8.02%
9.02%
10.06%
11.06%
RENTAL
CONTRIBUTION
RENTAL ESCALATION
18%
30%
52%
6.50%
7.50%
8%
8.75%
NATIONALS
8.50%
LINE SHOPS
Portfolio Income Growth
Section Heading
Section Heading
PROPERTY INCOME & EXPENSES
•
Turnover Rental
Section
Heading
• Woolworths
• Other
•
•
Parking Revenue
Transaction Costs
• TI’s
• Rent-free periods / BO periods
Portfolio Trading
Consumer Position
•
High Income vs. Low & Middle Income markets
Section
Heading
• Relative outperformance
but not immune to slowing economy
• Credit major differentiator
• Consumer Confidence differs depending on exposure to unemployment, strikes and cost pressures
• Growthpoint Portfolio position
•
Risks:
•
•
•
•
Aspirational shopper disappearing
Stock market performance
Increasing interest rates
Higher personal taxes and VAT increase
Changing Consumer Behaviour
•
Convenience
Section
Heading
• Migration to convenience
for food purchases
•
•
•
•
Stagnant/declining foot counts at most centres
Access/parking/lay-out important driver
Price/product range differentiation
On-line Shopping:
• Limitations:
•
Transaction Processing, logistics, experiential
• International Trends
• Growthpoint strategy
• Connectivity & analytics
Section Heading
Trading Density 24 Months
BROOKLYN MALL
8.2%
LA LUCIA MALL
5.6%
WALMER PARK
8.1%
5,000
CONSTANTIA VILLAGE
4.4%
4,000
WATERFALL MALL
-3.3%
KOLONNADE
5.9%
WOODMEAD RETAIL PARK
3.8%
RIVER SQUARE
-1.7%
Oct-2012 to Sep-2013
Monthly Turnover / m2
Y / Y % Growth
Affluent
Oct-2013 to Sep-2014
Solid-Middle
3,000
2,000
1,000
0
Lower-Middle
NORTHGATE
-1.7%
LONGBEACH MALL
11.3%
CBD / Commuter
LAKESIDE MALL
3.6%
ALBERTON CITY
1.3%
GOLDEN ACRE
10.2%
CITY VIEW
0.3%
CITY MALL
-2.0%
HATFIELD PLAZA
-0.5%
Section Heading
Rental Affordability
VALUE
(R mil)
GLA
VALUE / M2
COST OF
OCCUPANCY
AVE. TRADING
DENSITY
(12 Months)
BROOKLYN MALL (75%)
1,953
56,069
34,839
8.0%
2,759
WATERFALL MALL
1,287
49,228
26,142
7.0%
2,626
LAKESIDE MALL
1,234
67,515
18,270
6.8%
2,068
LA LUCIA MALL
1,066
36,379
29,295
7.3%
2,874
KOLONNADE (50%)
958
37,893
25,292
6.3%
2,828
WALMER PARK
901
43,202
20,858
6.3%
2,430
ALBERTON CITY
877
47,615
18,414
7.5%
2,133
CONSTANTIA VILLAGE
813
20,370
39,926
4.5%
5,792
NORTHGATE (50%)
756
45,329
16,669
10.0%
1,654
WOODMEAD RETAIL PARK
732
54,891
13,328
4.5%
2,831
TOP 10 CENTRES
Listed Retailers
GLA
Ave. Trading Density
(12 Months)
CHECKERS
23,229
2,817
PICK 'N PAY
73,420
2,625
CLICKS
13,781
3,204
GAME
35,886
2,012
MR PRICE HOME
10,809
1,905
MR PRICE APPAREL
13,717
2,685
FOSCHINI
9,128
1,869
TRUWORTHS
14,293
2,505
WOOLWORTHS
59,066
2,965
Listed Retailers
COMPETITION
CENTRE
ALBERTON CITY
RECENT NEW COMPETITION
Makro
Section Heading
POTENTIAL or NEW COMPETITION
Newmarket, Mall of the South, Meyerton
BROOKLYN MALL
Lynwood Bridge, The Club Centre
CITY MALL
Flamwood Mall, Matlosana Mall
KOLONNADE
Wonder Park redevelopment
Wonderboom Junction extension, WW stand-alone
LAKESIDE MALL
Carnival Mall extension
F&G Centre, Retail Africa Development
LONGBEACH MALL
Blue Route redevelopment
Checkers Centre
NORTHGATE
Cradle Stone, Cosmo Centre x2
Fourways redevelopment
RIVER SQUARE
Bentels centre
Vaal Mall extension
THE AVENUES
Carnival Mall extension
F&G proposed 60000m2 centre, Springs
CONSTANTIA VILLAGE
Blue Route redevelopment
WALMER PARK
Menlyn extension
BayWest, Boardwalk extension
WATERFALL MALL
Platinum Junction
WOODMEAD RETAIL PARK
Waterfall Lifestyle centre
Mall of Africa, Kyalami Checkers Centre
Ellerines
TOTAL RETAIL EXPOSURE
R1,479mil p.m
Beares/Dial-a-Bed continuing stores
Arcadia, Woodmead, Walerfall Mall, Meadowdale, Brooklyn, Beacon Bay
Leases Terminated as at end October
Waterfall Value centre, Woodmead, OK Empangeni
Leases Terminating end November
City View, OK Empangeni, Lakeside
Section Heading
Rental Losses
September 50%
R840 000
Expected to be recovered in full
Financial Year to end June
R3.8mil
Woodmead: Geen & Richards re-tenanted
Assuming vacating end March 2014
R1.7mil
Blackheath: Sold
MITIGATING ACTION
Brooklyn: Mr Price Sport/ Incredible Connection
Amrel: Redevelopment to motor showroom
City View: Woolworths Textiles Development
ACUCAP/SYCOM
Acucap/Sycom
•
•
•
Retail Portfolio Assessment
Current Developments/extensions
Opportunities
Section Heading
Gardens Centre
Howard Centre
•
Risks
Port Elizabeth
Kempton Park
Hillcrest/Kloof exposure
Thank you