The gross lettable area at Phoenix Plaza is to be increased by approximately 3,500 square metres and that at Dobsonville by nearly 5,000 square metres. MCH Properties has been appointed as turnkey developer for the expansion project, which is expected to deliver an initial net yield of about 11%.
Construction will start in January and should be completed by August 2006, Vukile said.
Vukile CEO Gerhard van Zyl said that, given the high current level of property prices, the company believed it was better to redevelop, expand and upgrade its existing properties than to acquire new ones, particularly as its portfolio has the potential for significant organic growth. The company was already investigating a number of similar projects.
"The expansion projects have been designed to add value and lower the risk profiles of these two centres," explained van Zyl.
"It will increase their national tenant base and enhance their status as a destination shopping experience; improve the average lease term, adding further security to the sustainability of cash flow and income growth; and protect them against future competitive developments in their catchment areas."
The Vukile portfolio currently comprises 52 properties throughout the country with a gross lettable area of 676,961 square metres. The company also holds some 75% of MICC Property Income Fund, which owns 40 properties with a gross lettable area 395,812 square metres.
I-Net Bridge
Publisher: I-Net Bridge
Source: I-Net Bridge
