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Africa Outlook

Hyprop
Investments

HYPROP INVESTMENTS

South Africa's Mall Specialist



Hyprop Investments limited is one of the top real estate investment trusts in South Africa

Writer Matt Bone
Project Manager Stuart Shirra

Hyprop is South Africa's largest specialist shopping centre real estate investment trust, currently listed on the Johannesburg Stock Exchange. It is the third largest real estate investment trust in the country and one of South Africa's oldest listed property companies. The company currently has R25 billion of assets under management, which includes 12 prime shopping centres in South Africa. Hyprop have exposure to malls in the rest of Africa through Atterbury Africa, a joint venture with Attacq Limited. Atterbury Africa has a 47 percent interest in Accra mall in Accra, Ghana and effective from the 1st July this year, 50 percent in Manda Hill Shopping Centre in Lusaka, Zambia. at 43 400m2, Manda Hill is the first regional shopping centre in Zambia and the largest in sub- Saharan Africa outside of South Africa.

Development and Innovation
Over the last two years, the company has undertaken an extensive redevelopment of Rosebank mall in Rosebank, Johannesburg, which is on track for completion in October 2014. Hyprop is expanding the mall from 36,000m2 to 62,000m2 and the number of stores will rise from 93 to 147. the approximately R930 million development is set to considerably boost economic growth in the Rosebank node and provide shoppers and tenants with a refreshed, world-class shopping facility.

CEO Pieter Prinsloo says: "this is one of our largest developments to date and aligns with our strategy of enhancing our existing portfolio and investing in dominant high quality shopping centres. we are confident the mall can capitalise on strong footfall in the area as Rosebank is one of South Africa's most cosmopolitan urban centres, close to a wide range of world-class amenities, the Gautrain rail node and premium international hotels."

The mall will be completely refurbished with new lifts, escalators, ablutions, mall finishes and additional parking. A unique feature of the project is that the mall was kept operational throughout the development. The challenges of balancing construction activities with the mall's continued operation have been addressed with meticulous planning, close engagement with the affected tenants and keeping to the schedule.

Hyprop has also implemented several new innovative initiatives in recent months. they have rolled out a R11.5 million energy saving project, which is expected to yield annual savings of R9.7 million. In addition, the company launched high-speed Wi-Fi at all its shopping centres. "The Wi-Fi rollout complements Hyprop's other technology advancements such as mobile applications and a presence on social media platforms such as Facebook, Twitter and Instagram," explains Prinsloo.

A Strong Portfolio
Hyprop has a specialised portfolio of properties consisting mainly of shopping malls, and it is this focused portfolio that differentiates Hyprop from its peers. Being a specialist company in a niche market, Hyprop has become the expert in its market and will continue to invest in high quality shopping centres in sub-Saharan Africa. In line with Hyprop's strategy to become a dominant African shopping centre REIT, the company intends to invest up to R3 billion in sub-Saharan Africa (excluding South Africa) over the next five years.

With R25 billion of assets under management, Hyprop has a proven track record of buying existing centres and successfully improving and expanding them through refurbishment and development. The quality of Hyprop's portfolio is further evidenced by the high occupancy rate of 98.2 percent (at December2013). The intention is to maintain and continuously improve the portfolio in order to be defensive in challenging times and leveraged when economic prospects improve. "Our leading position in terms of size, location and quality makes us the preferred landlord for premium local and international brands," adds Prinsloo.

Foreign Opportunities
Opportunities abound, particularly from international brands, which continue to enter South Africa with aggressive roll-out plans, including preeminent fashion brands that have chosen to launch their African presence in South Africa and within Hyprop's portfolio.

Hyprop is well positioned to benefit from the growth of consumer markets in Africa. Atterbury Africa has made significant progress in developing quality shopping centres in the rest of Africa, specifically in Ghana. In addition to the existing Accra Mall, the West Hills Mall in Accra, Ghana is on track for completion by October 2014. Additional development projects include the Achimota Mall (13,000m2) in Achimota and the Kumasi City Mall (27,000m2) in Kumasi, Ghana.

Caring for the Community
Hyprop's social activities are driven by the Hyprop Foundation, which provides a centralised vehicle for Hyprop's social investment projects. These are focused on education, social upliftment, enterprise development, poverty alleviation, health and well-being. As part of its health and well-being initiatives, the company hosts an annual health day at its head office and shopping centres. A key feature of the Foundation is that employees are encouraged to participate through a system of "care shares", thereby fostering a culture of involvement.