Vukile plans to expand in retail in rural areas

Posted On Wednesday, 25 May 2011 02:00 Published by eProp Commercial Property News
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Property loan stock company Vukile Property Fund said yesterday it was looking at expanding its retail offering to underserved rural areas and previously disadvantaged areas across the country

Laurence RappProperty loan stock company Vukile Property Fund said yesterday it was looking at expanding its retail offering to underserved rural areas and previously disadvantaged areas across the country.

Explaining the rationale for this, CEO Gerhard van Zyl said retail in rural areas had served the company "very well" and had allowed it to perform better than its peers. "We are looking at areas that are not serviced, especially in retail because that is where we see opportunities and growth. We continue to look at other properties to acquire so that we expand our portfolio."

Vukile posted a 26,2% increase in net profit available for distribution, to R408,1m for the year ended March. Distributions rose 9% to 117,65c per linked unit. Mr van Zyl attributed the company’s performance to the quality of its underlying properties, the growth of its portfolio and the additional revenue from the asset management business acquired last year, as well as firm control of costs and vacancy levels.

If acquisitions and disposals are excluded, on a like-for-like basis, company net property revenue increased 9,5%, to R836m from R742m previously. But as a result of tough trading conditions, vacancy levels as a percentage of gross rentals increased to 5,1% from 4,1% at the previous year-end.

However, the recurring costs to property revenue ratio, excluding electricity rates and taxes, decreased from 16,5% to 15,3% year on year.

The asset management business performed well during the year, earning asset management fees of R33,6m, which was R3,1m higher than the income forecast in the circular to shareholders dated November 26 2009.

Sales commission of R29,3m was R5,3m higher than forecast in the circular and Mr van Zyl said this was due to higher than expected disposals in the Sanlam portfolio.

Last modified on Friday, 25 April 2014 22:54

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