Fairvest is to acquire two malls in KwaZulu-Natal as it continues its strategy of investing in retail assets servicing previously underserviced communities.
The group has acquired Jozini Mall and Tugela Ferry Mall from Muller Group Invest for R674m at a blended yield of 10.17%, the real estate investment trust (Reit) said on Thursday.
The transaction is consistent with its strategy of investing in retail assets located close to community centres and transport networks, it said.
The group owns 128 retail, office and industrial properties worth nearly R13bn and has recently beefed up its portfolio with acquisitions in KwaZulu-Natal and the Western Cape.
In August, Fairvest raised R976m in an accelerated book build and said it would use the proceeds for acquisitions and investments.
The property group had initially aimed to raise R400m, but later increased the amount to R970m in the light of the strong demand for the offering.
The group said in September that it expects to exceed the upper end of its distribution growth guidance of 8%-10% per B share for the 2025 financial year, driven by a resilient portfolio and operational efficiencies in a tough macroeconomic environment.
In a pre-close update for the year ended September, Fairvest reported stable trading conditions, with its retail portfolio — accounting for 70.9% of group revenue — continuing to anchor performance.
Vacancies across the portfolio ticked up slightly to 5.9% from 5.5% reported in March, while tenant retention declined to 79.6% from 81.3%. However, Fairvest achieved positive rental reversions of 5.0%, up from 4.3% previously, reflecting improved leasing conditions.
The group also highlighted progress in its alternative infrastructure investment strategy, with R486m deployed into Onepath Investments, a subsidiary focused on acquiring de-risked fibre infrastructure in township areas.
“The fibre infrastructure is rented to a fibre network operator to provide high-quality internet access to township homes and communities. The rent received generates an attractive, accretive dividend yield for Fairvest,” the group said.
Recent acquisitions include Thembalethu Square in George, as well as Shoprite Manguzi, Ulundi Shopping Centre, and Nquthu Shopping Centre in KwaZulu-Natal.
With Noxolo Majavu
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