COMPANY PROFILE
2013
HYPROP
Hyprop’s investment in Rosebank
COMPANY REPORT
Hyprop’s investment in Rosebank
Editorial – Joe Forshaw Production – Lauren Grey
Hyprop is the largest listed shopping centre fund in South Africa. The company manages 11 of the country’s largest, premium quality shopping centres and has a diverse tenant base across the nation. After taking control of the Attfund portfolio (discussed in our June 2012 edition) the company is now looking for further growth. With major investments underway, we speak to the CEO to find out what the future holds for Hyprop. Cape Gate Shopping Centre
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HYPROP In South Africa people love to shop. The shopping scene in the major cities in second to none on the continent and all over the country there are outlets, ranging from small to supersize, that sell everything a modern consumer could possibly desire. Even in the countryside, away from the hustle and bustle of the central business districts (CBD), shopping thrives with small outlets run by farmers, rural trade markets and singlestore boutiques contributing the country’s retail spend. The country’s large shopping malls (of which there are many) are now the go to places to shop, ironically because their overall offering is more than just stores. Shopping malls now host a range of events including: Celebrity appearances, exhibitions, trade shows, musical performances, theatre productions and art exhibitions. The popularity of major shopping centres is reflected in
the country’s on-going retail sales growth, even through the tough economic climate of the past few years. With over 800,000m² of lettable retail area, across 11 of the country’s premier shopping centres, one of South Africa’s leading property investment organisations is Hyprop. The expert property management company has seen the fruits from continued spending in the retail sector and tenants in the shopping centres have seen the fruits from booming online and in-store sales. Hyprop owns and manages 11 malls and splits them into four categories: Super regional (Canal Walk), Large regional (Clearwater Mall, CapeGate Retail Precinct, The Glen, Woodlands Boulevard), Regional (Hydepark Corner, Rosebank Mall) and Value/Lifestyle (Atterbury Value Mart, Willowbridge, Stoneridge, Somerset Value Mart).
Rosebank Mall Redevelopment Jan 2013
Stoneridge Centre
MAR 13 PAGE 3
COMPANY REPORT
ROSEBANK MALL When we looked at the business in 2012, the company was preparing for its acquisition of the Attfund Retail portfolio and it was clear that Hyprop planned to invest in improvements of its new and existing assets. Those plans came to fruition in August of that year as the company began major upgrades of the Rosebank Mall. R920 million will be spent on redeveloping the mall, giving shoppers a refreshed and modernised retail facility. The mall will increase in size to 62,000m², almost doubling the available floor space. In addition to adding substantial new retail space the centre will be completely refurbished with new lifts, escalators, ablutions, floor tiles, ceilings, lighting and shop fronts. When the development is complete, the mall will boast around 160 stores making it the shopping hub of the busy Rosebank node.
WBHO is proud to be associated with Hyprop on The Rosebank Mall Project
The success of Hyprop is partly down to the thriving retail environment in the country right now and developments at the Rosebank Mall will look to add to the prosperous market. “Supporting local brands is key to Hyprop’s tenantmix strategy for Rosebank Mall,” says Hyprop’s CEO Pieter Prinsloo. “The right blend of global brands and popular local retailers will ensure that the mall caters to a wide range of shoppers, increasing its reach and appeal.” He also notes that the development is in line with the company’s ambition to grow its current portfolio saying: “Rosebank is an integrated urban environment offering visitors a unique ‘live, work, play’ experience. We are confident that the new Rosebank Mall will leverage this to realise major benefits for tenants and shoppers, as well as Hyprop’s unit-holders, in line with our strategy of growing existing investments.”
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Wilson Bayly Holmes - Ovcon Limited 53 Andries street, Wynberg, Sandton P.O. Box 531 Bergvlei 2012. South Africa Tel: +27 11 321 7200
Fax: +27 11 887 4364
(e) wbho@wbho.co.za
(w) www.wbho.co.za
Proud to be associated with Hyprop Investments Limited
The project is set to reach completion in September 2014 and new tenants will include international brands such as Pringle, Ben Sherman, Kurt Geiger, Earthchild, Woolworths Platinum, Edgars, Dis-Chem, Mr Price Sports and Jet. The mall will remain open during construction allowing existing retailers including Stuttafords, Truworths, Mr Price, Queenspark and Foschini to operate without slowdowns or breaks in income. “Construction is being carried out in a phased process and is progressing well,” says Mr Prinsloo. “90% of the lettable area has already been taken up in committed leases.”
“The right blend of global brands and popular local retailers will ensure that the mall caters to a wide range of shoppers, increasing its reach and appeal,”
“There is upbeat demand for new and extra space at Canal Walk.”
COMPANY REPORT
HYPROP
Hydepark Shopping Centre CANAL WALK Another indication of the success at Hyprop is the fantastic level of customer retention. At the Canal Walk shopping centre, located in Century City, between Cape Town and Belville, CEO Gavin Wood says that tenant retention is a sign of business confidence in the continents leading super regional retail outlet. “There is upbeat demand for new and extra space at Canal Walk. While our positive trading performance drives retail demand, businesses choose offices at Canal Walk to be centrally located, secure and benefit from unparalleled access to retail, banking and parking.” The shopping centre is the now one of the most sought after business locations, for retail and office space, in the country. Described by the company as ‘the jewel in the crown of JSE listed property heavyweight Hyprop Investments Limited’s portfolio’, Canal Walk, much like Rosebank, is not finding it difficult to attract standout tenants. Its dominant presence attracts diverse shoppers from an extensive portion of the Western Cape, and further afield, with its comprehensive retail and leisure options of 400 shops, services and restaurants. Blue-chip
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companies occupy office space in the two eight-storey prime office directly above the mall, with spectacular views of Table Mountain and Robben Island and easy access from the N1. In the last year stores including; Superga, Steve Madden, Fielli, Typo, Entrepo, H.O.M, Hugo Boss, Boardriders and XOXO have all taken occupancy in Canal Walk – a testament to the vision of Hyprop, a vision which sees the company intending to be the frontrunner for investment in South Africa, offering the distinct opportunity to access income and capital growth through a specialist portfolio of high quality, high performance shopping centres in a simple, sustainable investment vehicle. With R20.6 billion in total assets, Hyprop remains positioned as the premier property investment organisation in South Africa. With shopping centres now categorised as one of the most defensive real estate asset classes and the nation proving its financial systems to be some of the strongest in the world, Hyprop is ideally placed to ensure continued growth in the value of all its assets from super regional shopping centres to office parks.
We are celebrating its our Intellepark celebrates 10th year in the South African its 10th industry this year. parking anniversary Intellepark celebrates its 10th year in the South African parking industry this year, following its success in winning one of the Circontrol Group’s Smart Cities awards in October last year for its Pavillion Parking Guidance Project.
Training offered at Intellepark’s new Johannesburg office. As there is an on-going need to train new operators and
was included so that training can take place in a less pressurised environment. A full demo facility is available on the ground level of the Existing customers, prospective customers and trainees are able to view and operate our products. Not only does
Intellepark Managing Director, Sheldon James, founded the company in February 2003 with Theo Christodoulou;
this assist tremendously during training but allows existing and prospective customers the ability to experience new
six month’s later Tim Reynolds, Director in Charge of Sales & Projects, joined Intellepark and since then the company has grown at an unprecedented rate, increasing its market footprint to become one of the most instantly recognisable parking brands in the country.
Our product and business strategy is taking new complimentary technologies to our existing customer data-
Intellepark’s Johannesburg office moves to RivoniaFormerly located
base as well as supplying existing technologies to new markets, like the African market.
Road, Rivonia. Intellepark started out 10 years ago with a small premises in Peter Place, Bryanston, which was only about 120m2 and Durban were subsequently opened 2005 and 2006 respectively. We outgrew Johannesburg premises in just two years and, after several years at Belgrave House, also in Bryanston, we are now settled in the new building and employ 80 people.”
Block C 57 Wessels Rd Rivonia South Africa 2128
Some of Intellepark’s projects completed in Africa include: • • • •
Pay On Exit System - Nigeia, Kenneth Kaunda International Airport Central Payment System - Ikeja City Mall in Lagos, Nigeria Two central cashier sites in Harare, Zimbabwe Pay On Foot Systems - Hilton Hotel, Windhoek,
tel: +27 11 463 9673 fax: +27 11 463 9675 mob: +0861 112 622 web: www.intellepark.co.za
COMPANY REPORT
The Glen PAGE 8 MAR 13
HYPROP DISTRIBUTION GROWTH Hyprop reported in February that distributions had risen by 6.8% at the end of 2012, to 409 cents per unit. Total return to unitholders was 44.8% supported by a 37% growth in market capitalisation to R17.7 billion. Investments in Africa and of course, the Rosebank project were catalysts for the rise. “Over the past 25 years Hyprop has consistently delivered sustainable income and capital growth, and in our quarter century anniversary year has again demonstrated solid growth,” says Mr Prinsloo. “Some progress was also made in reducing vacancies in the office portfolio, despite a far tougher commercial market. Total vacancies overall decreased to 2.5% from 3.9%,” says Mr Prinsloo. Effective cost control improved the overall cost to income ratio to 35.4% from 37.5% in December 2011, while total arrears reduced from R41.3 million in the previous year to R19.8 million. Taking into account the short-term dilution effect of the Rosebank Mall development, Hyprop expects distribution growth of 5% to 7% for the year ahead
Tekweni Centurion Ceilings celebrating 26 years of successful trading as a favourite subcontractor to all major building contractors throughout South Africa and Botswana.
Johannesburg
011 708 0934 Durban
031 569 2796
to December 2013, something which investors will be happy to hear. Investment in Africa, including the acquisition of a stake in Atterbury Africa has marked Hyprop’s entry into continental markets. “The emerging economies in Africa offer us promising opportunities to expand on quality existing centres and to develop our own in these fast-growing regions,” says Mr Prinsloo. Opportunities on the continent are now forming a more significant part of the Hyprop strategy. Mr Prinsloo says: “Our focus remains on investment in dominant shopping centres both locally and across Africa, while continuing to dispose of any remaining non-core assets if the opportunity arises.” One of the most encouraging figures released by the company recently showed that total arrears were down, reduced from R41.3 million in the previous year to R19.8 million at the end of 2012, demonstrating successful management, even during what is one of the most challenging periods in the economic climate in recent history.
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Specialising in ceiling and partition requirements, internal and external. Most recent achievements and completed projects include: 1. Lynwood Bridge – Won St Gobain’s National ceiling award and represented South Africa in the 8th St Gobain’s International ceiling awards. 2. King Shaka international airport 3. OR Tambo airport 4. Lynwood Bridge shopping centre 5. Alexander forbes building 6. Various shopping centres and office blocks
Currently contracted to do mall ceilings in the refurbishment and additions to mall of Rosebank and 102 Rivonia Road Sandton.
Commitment and passion is our recipe for success.
+27 11 447 0090 www.hyprop.co.za
(0)1603 618 000 info@industrysa.com East Coast Promotions Ltd, Ferndale Business Centre, 1 Exeter Street. Norwich, Norfolk NR2 4QB