JSE-listed SA Corporate Real Estate has reported a 5% increase in profit for the 12 months to end-December, largely driven by higher rentals.
The real estate investment trust, with a portfolio of 267 properties spanning industrial, retail and residential buildings, said distributable income rose to R680.9m, or 27.08c a share, from R647.8m a year earlier as net property income rose to R1.5bn from R1.3bn.
The company declared a dividend of 24.37c a share, at a 90% payout ratio, up from 23.18c at the same ratio in 2023.
Like-for-like net property income increased by 6.7% to R1.1bn. In addition, the group reported a disposal pipeline valued at R908.6m, comprising R154.9m in completed sales and R753.7m in agreed sales.
The vacancy rate of its so-called traditional portfolio eased to 1.5% of gross lettable area over the review period from 2% in 2023.
The Afhco residential portfolio improved its vacancy rate to 3% from 4.2%, while IndluPlace’s residential vacancies increased slightly from 4.5% to 5.1%.
SA Corporate said the defensive nature of its portfolio placed it in a good position to take advantage of the cautious optimism for a pickup in economy in 2025.
Vacancies in the retail portfolio are expected to remain near 2024’s level, though “a part of the net property income increase associated with contractual rental escalations is to be offset by the downtime associated with improving tenant quality with re-tenanting”, it added.
“Escalations above 6% are contracted for 81% of leases in 2025. Renewal reversions are expected to be marginally positive. The industrial portfolio is anticipated to achieve net property income growth comparable with inflation for this financial year with a 100% let portfolio, escalations between 6% and 7% and reversions being positive,” SA Corporate said.
In the residential portfolio, performance is expected to remain strong throughout 2025, with occupation levels high and residential rental increases expected to continue their positive trend and to increase by at least inflation, it added.
Talks are continuing with a potential investor for a possible R1.25bn purchase in the group’s Unlisted Residential Fund.
For the year the end-December 2025, distributable income growth is estimated to be marginally above inflation.
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