An interim distribution of 14,75 cents/unit for the six months ending 30^{th June, was declared for Capital Property Fund, compared to 14,01 cents/unit for the same period in 2002, an increase of 5,3%. Earnings for the remainder of 2003 are likely to be similar to those of the first six months.}

Charles Ryan, fund manager of Capital, says that one property has been disposed of this year, with transfer of a further eight expected in 2003. This is in line with our stated strategy of disposing of the older under-performing properties in the poorer localities. "Transfer of a number of these has been delayed due to the difficulty of obtaining rates clearance certificates from the municipal authorities. Various options to grow the portfolio significantly are being considered."

He adds that vacancies have declined from 14% a year ago to 10% as at the end of June 2003. The current vacancy includes 3 200 m² at Southway Mall as a result of the redevelopment in progress. Upon completion of the project and the disposal of the eight aforementioned properties, the vacancy level is likely to reduce to 6%. These are primarily in the remaining older properties. An ongoing tenant retention focus will also assist in increased occupancy levels.

The R14 million redevelopment of Southway Mall is proceeding on schedule, with completion expected in mid-December. The building is being split into two parts, a convenience section with an adjoining value shopping component. Both sections will be refurbished to modern standards. It is substantially pre-let with 76% of the space committed. Continued interest by a number of retailers should ensure it is fully let upon completion.

According to Ryan, an investigation into the possibility of providing additional parking at 2 Long Street, an office block in Cape Town, acquired by the portfolio earlier in the year, is well advanced. Refurbishment of the entrance, all lobbies, toilets and lifts is also a possibility. Construction could possibly start late in 2003.

Ends

Issued by Rosemary Roberts of JHI Real Estate Ltd

Tel: (011) 441-0339

Fax no.: (011) 441-0172

8th August 2003