Metope In The News

Showing there is still life yet in bricks-and-mortar retail, Sandton City, one of SA’s premier shopping malls is now fully let for the first time, having spent the past three years signing up more luxury brands than any other centre in SA. The 45-year-old super regional centre, which has 147,940m² of retail and leisure space, has zero vacancies, while other superregional centres are averaging 5.8%, according to the SA Property Owners’ Association. Metope investment analyst Kelly Ward comments.

The slowdown in dividend growth reported by most South African-focused real estate stocks in recent weeks coupled to SA's economic contraction and weaker rand will no doubt prompt investors to re-look their offshore allocations. A key question for investors is which individual counters among the JSE's bevy of close to 20 pure rand hedge property stocks now offer the best buying opportunities? Metope investment analyst Kelly Ward comments.

Polish retail property company EPP (formerly Echo Polska Properties) got off to a rocky start when it made its debut on the JSE two years ago as back then, SA investors were clearly not yet buying into the Polish growth story. But there appears to have been a marked turnaround in investor sentiment since early this year. Though the counter is still trading slightly below its listing price of R23.50, it has notched up share-price growth of a hefty 45% from February 5, when it hit a two-year low of R14.40. Metope investment analyst Kelly Ward comments.

Real estate investors may well be tempted to stash their cash elsewhere in light of the disappointing income and share price performances delivered by JSE-listed property stocks this year. Few SA-based real estate investment trusts (Reits) have bucked the general trend. Fairvest Property Holdings is a notable exception. The company, which owns a R3bn portfolio of more than 40 retail centres that cater mostly for lower-income shoppers in townships and rural areas, last week reported dividend growth just short of 10% for the year to the end of June. Metope investment analyst Kelly Ward comments.

The dismal performance of the listed property sector year-to-date has no doubt prompted property punters to reassess their investment strategies.  However, industry players believe the correction has been overdone: property stocks are now trading at record high yields, with as many as 20 out of the sector's 50-odd counters offering income chasers yields of between 10% and 18%. That offers value relative to long-term SA government bond yields, which are sitting at around 8.8% (mid-August). Metope investment analyst Kelly Ward comments.

Shareholders of embattled property stocks Resilient Reit and Fortress Reit (B shares), which have both recorded share price losses of 62% in the year to date, will have to be satisfied with far more subdued dividend payouts than the double-digit growth they have become accustomed to in recent years. However, while the property stocks are only expected to return to inflation-beating dividend growth in 2020, both are starting to reappear on buy lists. Metope investment analyst Kelly Ward comments.    

In her 30 years in the commercial property sector, CEO of Metope Investment Managers Liliane Barnard has held many positions, including those of Head of Asset Management at Old Mutual Property and independent non-executive director of Pangbourne, Emira and Redefine. “It’s an amazing career,” she says. “You can work for any of the large or small firms that offer a variety of different opportunities, or you can work for yourself. I’m encouraged by the increased number of young women venturing into our industry – their impact on the broader environment is becoming visible in a very positive way." Read the full interview below.

Equites Property Fund listed on the JSE in June 2014 to become the first specialised industrial real estate investment trust (Reit), offering investors a pure play exposure to modern "Big Box'' logistics and distribution assets. Liliane Barnard, CEO of Metope Investment Managers, gives her views.

Vukile Property Fund's turnaround strategy, which began several years ago, is bearing fruit as the fund has repositioned itself as a focused retail player, with investments in SA, the UK and, more recently, Spain. Metope investment analyst Kelly Ward comments.