Sa Corporate Real Estate Ltd. · JSE:SAC
Sa Corporate Real Estate — FY2024 Earnings Presentation
59 slides from Sa Corporate Real Estate's earnings presentation, Mar 14, 2025
Slide 1: SA Corporate 2024 Year End Results Presentation
SA Corporate 2024 Year End Results Presentation 14 March 2025
Slide 2: Strategic Pillars
STRATEGIC PILLARS Sustainable Distribution Growth & Long Term Capital Appreciation Robust Retail Portfolio Quality Logistics Portfolio “Best-in-Class” Residential ▪ Specialising in convenience- ▪ Invested in high-demand, Portfolio oriented shopping centres strategic locations ▪ Focused on inner city
Slide 3: Agenda
AGENDA 01 Strategy Update Rory Mackey 02 Overview Samson Mojalefa Portfolio Performance 03 Nomzamo Radebe & Kevin Van Den Heever Financial Performance 04 Sam Moodley 05 Outlook Samson Mojalefa
Slide 4: Strategy Update
STRATEGY UPDATE RORY MACKEY | SA CORPORATE AFHCO { REAL ESTATE Ain Hoag
Slide 5: Strategic Initiatives
STRATEGIC INITIATIVES Retail • Revitalise portfolio & strengthen grocer anchors o Springfield Value Centre o Musgrave Centre o Coachmans Crossing o Montana Crossing • Re-tenanting 2023 Industrial • Reduce income loss due to downtime between tenancies • Improve renewal reversions • Reduce exposure to
Slide 6: Retail: Revitalise portfolio & strengthen grocer anchors
RETAIL Revitalise retail portfolio & strengthen grocer anchors Springfield Value Centre • Rebuilt after July 2021 riots • New tenants include: • Shoprite to replace Pick n Pay (to commence trading August 2025) ➢ Trading density increased by 24.4% over 24 months since rebuild Musgrave Centre • Checke
Slide 7: Retail: Montana Crossing
RETAIL Revitalise retail portfolio & strengthen grocer anchors (cont’d) Montana Crossing • Phased redevelopment of property • New direct access constructed off Sefako Makgatho Drive (ex Zambezi Drive) • Build it replaced poor performing independent retailer to enhance convenience offering • Checkers
Slide 8: Retail: Re-tenanting
RETAIL Re-tenanting Cambridge Crossing • Clicks replacing poor performing restaurant East Point • Makro Express replacing Game • Bounce replacing Decathlon Bluff Towers Shopping Centre • Pick n Pay Clothing replacing the Post Office Musgrave Centre • Bootleggers replacing poor performing restaurant
Slide 9: Retail Portfolio 2024 Trading Density Growth vs MSCI
RETAIL PORTFOLIO 2024 TRADING DENSITY GROWTH VS MSCI SA Corporate portfolio exposure 9.0% 8.0% 8.0% 7.0% 6.9% 6.6% 6.0% 6.3% Trading density growth % 5.7% 5.0% 4.4% 4.5% 4.0% 3.0% 3.4% 3.4% 2.7% 2.0% 1.0% 0.0% Super Regional Centres Regional Centres Small Regional Centres Community Centres Neighbour
Slide 10: Industrial
INDUSTRIAL Reduce Income Loss Due to Downtime Between Tenancies Zero vacancy as at 31 December 2024 with average downtime of one month for new replacement tenants On the ground pro-active leasing in a refined portfolio in high demand established nodes Improve Renewal Reversions 2023 -0.89% imp
Slide 11: Industrial: Unlock redevelopment potential
INDUSTRIAL Unlock redevelopment potential 5 Westgate, Westmead • 1 800m2 redevelopment by demolishing offices adjacent to existing 3 900m2 logistics warehouse • 10% forecast initial yield on capex of R20m ➢ Transforms property to be attractive logistics facility 11
Slide 12: Residential: Raise capital for investment
RESIDENTIAL Raise capital for investment in residential property • 18 November 2024 – Potential cornerstone investor’s investment committee approved an investment of up to R1.25 billion in SA Corporate’s Unlisted Residential Fund after comprehensive due diligence. • 26 November 2024 – Meeting with p
Slide 13: Residential: Targeted leasing promotions
RESIDENTIAL Targeted leasing promotions Attracting New Tenants Retaining Tenants % LEADS BY MEDIUM 55.3% 17.5% 24.8% 2.4% 13
Slide 14: Residential: AI rental competitor analysis
RESIDENTIAL AI rental competitor analysis 14
Slide 15: Residential: Digitisation reflective of a market leader
RESIDENTIAL Digitisation reflective of a market leader ERP 15
Slide 16: Residential: Amenities for an Improved Lifestyle
RESIDENTIAL Amenities for an Improved Lifestyle 16
Slide 17: Residential: Safety is paramount
RESIDENTIAL Safety is paramount R10 million contribution to Jozi My Jozi for AI enabled CCTV security cameras Afhco precincts Afhco precincts CCTV cameras Vumacam CCTV cameras 17
Slide 18: Residential: Sale of poorer quality properties
RESIDENTIAL Sale of poorer quality properties Contracted And Unconditional Description Gross selling price Region Indluplace Non-Core Portfolio Balnagask, Johannesburg R46 700 000 Gauteng Monsmeg, Johannesburg R9 000 000 Gauteng The Sentinel, Johannesburg R73 300 000 Gauteng To be sold Geraldine Cou
Slide 19: Closing the ownership gap / unlocking value from apartment sales
RESIDENTIAL Closing the ownership gap/unlocking value from sale of non-core apartments to the retail market Total Apartment Sales Quantum 3 427 apartments R1 165.1 million 2024 Transferred 216 apartments R87 million Contracted Awaiting Transfer 233 apartments R109 million Transferred & Contracted To
Slide 20: Targeting First Home Finance Subsidy Analysis
RESIDENTIAL Targeting First Home Finance Subsidy Analysis Afhco apartment sales priced off historical cost more advantaged by First Home Finance Subsidy than newly built competitor sales 20
Slide 21: Afhco apartment sales competence
RESIDENTIAL AFHCO apartment sales competence o Afhco uniquely positioned to sell apartments to those in the “ownership gap” • Households who earn too much to qualify for the RDP subsidy, but too little to easily afford homeownership • Generally, households that earn between R3 500 and R22 000 per mo
Slide 22: Afhco online sales process
RESIDENTIAL AFHCO online sales process Buyer Campaigns Lead Automation Using AI automated, highly-targeted AFHCO Agent nurtures social media campaigns buyer-lead Buyer Consultant Pre-approval Choice Lead Management Customer decides to get pre- Buyer finds a property online Consultant nurtures the cu
Slide 23: AI optimised social media sales marketing
RESIDENTIAL AI optimised social media sales marketing Optimised Content • Clicks Reach Conversion Cost Demographics • Impressions Rate Location Measured 23
Slide 24: Zambia
ZAMBIA Lusaka’s dominant retail node of 112 000m2 anchored by East Park Mall 24
Slide 25: Zambia Investment
ZAMBIA INVESTMENT Creating a platform to unlock value with future liquidity • Redevelopment of Arcades Mall (acquired as part of LuSE listed REIZ) to be completed in Q1-2025 complementing East Park Mall and entrenching the position as Lusaka’s dominant 112 000 m2 retail node • “On the ground” manage
Slide 26: Overview
OVERVIEW SAMSON MOJALEFA
Slide 27: Overview: Distribution
OVERVIEW DISTRIBUTION DISTRIBUTABLE INCOME 5.1% vs twelve months to 31 December 2023 R680.9 million or 27.08 cps (2023: R647.8 million or 25.76 cps) DISTRIBUTION Declared 24.37 cps at 90% payout ratio (2023: 23.18 cps at 90% payout ratio) 27
Slide 28: Overview: Portfolio Performance
OVERVIEW PORTFOLIO PERFORMANCE TOTAL NET PROPERTY INCOME (“NPI”) TRADITIONAL PORTFOLIO VACANCIES % of gross lettable area (“GLA”) R1.5 billion 1.5% (2023 : R1.3 billion) (2023: 2.0%) TOTAL LIKE-FOR-LIKE NPI INCREASED BY RESIDENTIAL PORTFOLIO VACANCIES % of total units 6.7% to R1.1 billion (2023: R1.
Slide 29: Overview: Property Activity and Capital Structure
OVERVIEW PROPERTY ACTIVITY CAPITAL STRUCTURE DISPOSAL PIPELINE SINCE 1 JANUARY 2024 LOAN TO VALUE (“LTV”) RATIO R908.6 million 42.0%* (Transferred to 31 December 2024: R154.9 million; Contracted not yet transferred: (2023: 41.9%) R753.7 million, of which R0.6 million has transferred after 31 Decembe
Slide 30: Portfolio Performance
PORTFOLIO PERFORMANCE NOMZAMO RADEBE & KEVIN VAN DEN HEEVER
Slide 31: Overview – Sectoral Analysis of South African Portfolio
OVERVIEW – SECTORAL ANALYSIS OF SOUTH AFRICAN PORTFOLIO 31
Slide 32: SA Portfolio: Retail
VALUE OF SOUTH AFRICAN PORTFOLIO SA PORTFOLIO: RETAIL 39.4% (2023: 38.7%) LIKE-FOR-LIKE 5.1% COLLECTIONS 101.2% NPI GROWTH (2023: 5.3%) (2023: 97.4%) VACANCY1 2.4% ARREARS 3.9% (2023: 2.7%) (2023: 5.8%) RENTAL 6.1% WALE 2 3.6 years ESCALATION (2023: 6.4%) (2023: 4.0 years) RENTAL 0.5% TENANT GRADE 8
Slide 33: Retail Performance Trends
RETAIL PERFORMANCE TRENDS Retail Vacancy by GLA Retail Average Rental per m 2 5.0% 4.6% 4.6% 190 186.82 179.04 4.0% 180 3.2% 169.98 3.0% 2.7% 170 2.4% 161.53 163.78 2.0% 160 1.0% 150 0.0% 140 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 Retail Contractual Escalation Retail Renewal Reversion 7.5
Slide 34: Retail Trading Density Growth
RETAIL TRADING DENSITY GROWTH 26% growth over 5 years 4,000 7.0% 6.6% 3,500 6.3% 6.0% 5.9% 3 350 3,000 4.6% 3 144 5.0% Trading Density Growth (%) 2 957 2 792 Trading Density(R/m2) 2,500 2 669 4.0% 2,000 3.2% 3.0% 1,500 2.0% 1,000 500 1.0% 0 0.0% 2020 2021 2022 2023 2024 Trading density Growth
Slide 35: Top Category Trading Density Growth (2024 vs 2023)
TOP CATEGORY TRADING DENSITY GROWTH (2024 vs 2023) R9 006/m2 R6 690/m2 R4 271/m2 R5 993/m2 R2 414/m2 R4 615/m2 R4 786/m2 120,000 20.0% 18.0% 100,000 16.0% 14.4% 15.0% Trading density growth % Square Metres (m2) 14.0% 80,000 12.0% 60,000 9.1% 10.0% 7.9% 7.9% 8.0% 40,000 6.0% 3.8% 3.8% 4.0% 20,000 2.0
Slide 36: SA Portfolio: Industrial
VALUE OF SOUTH AFRICAN PORTFOLIO SA PORTFOLIO: INDUSTRIAL 18.5 % (2023: 18.5%) LIKE-FOR-LIKE 7.2% COLLECTIONS 100.3% NPI GROWTH (2023: 5.3%) (2023: 101.5%) VACANCY 0.0% ARREARS 1.7% (2023: 0.2%) (2023: 2.4%) RENTAL 6.2% WALE 2.1 years ESCALATION (2023: 6.4%) (2023: 2.3 years) RENTAL 0.7% TENANT GRAD
Slide 37: Industrial Escalations and Reversions
INDUSTRIAL ESCALATIONS AND REVERSIONS 10.0% 7.1% 7.2% 6.7% 6.4% 6.2% 6.4% 5.0% 5.9% 6.0% 4.4% 3.1% 0.7% 0.0% -0.9% -3.1% -5.0% -7.0% -10.0% -12.7% -15.0% 2020 2021 2022 2023 2024 Escalation Renewal Reversion Inflation 37
Slide 38: SA Portfolio: Afhco
VALUE OF SOUTH AFRICAN PORTFOLIO SA PORTFOLIO: AFHCO 40.8 % (2023: 41.3%) TOTAL RESIDENTIAL INNER CITY RETAIL (91.5% of portfolio) (8.5% of portfolio) VACANCY VACANCY RENTAL NPI GROWTH RESIDENTIAL 1 RETAIL ESCALATION AFHCO LIKE FOR LIKE AFHCO AFHCO AFHCO 7.9% 3.0% 5.0% 6.4% (2023: 3.3%) (2023: 4.2%)
Slide 39: Financial Performance
FINANCIAL PERFORMANCE SAM MOODLEY
Slide 40: Financial Sustainability
FINANCIAL SUSTAINABILITY • Refinanced R225.6 million of facilities expiring in 2024 and 2025, at tenors of 1 to 5 years and a margin of 69bps lower than the previous debt margin. • Post year end refinanced USD27 million facility at a tenor of 3 years and DEBT at an improved margin of 115bps lower th
Slide 41: 2024 Full Year Distributable Income Analysis
2024 FULL YEAR DISTRIBUTABLE INCOME ANALYSIS December 2024 December 2023 % Rm Rm Like-for-like NPI 1 088.0 1 019.6 6.7 Total NPI 1 486.1 1 298.6 14.4 Income from JV 59.7 58.3 2.4 Net finance costs (728.4) (606.4) 20.1 Distributable income 680.9 647.8 5.1 Per share 27.08 25.76 5.1 Income R124.4m 6.6%
Slide 42: Net Asset Value (cps)
NET ASSET VALUE (CPS)1 450.0 3 2 3 (3) (1) 425.0 439 443 400.0 375.0 Opening NAV 1 MTM swaps Other Revaluation of Foreign Distributable Closing NAV 31 January 2024 derivatives movements investment adjustment i.r.o. income net of December 2024 properties (2) Zambia JV distributions paid (1) Based on
Slide 43: Investment Property Analysis
INVESTMENT PROPERTY ANALYSIS 18 000 319 17 943 17 721 (149) 61 17 500 (9) 17 000 16 500 16 000 Investment Disposals Owner occupied Fair value Improvements / Investment Properties buildings adjustment Development costs Properties December 2023 transferred to December 2024 property, plant and equipmen
Slide 44: Debt & Interest Rate Swap Facilities
DEBT & INTEREST RATE SWAP FACILITIES DEBT FACILITIES Weighted average rate Total debt facilities Cash and undrawn facilities Average tenor (“WAR”) excluding swaps R8.8 bn R518.9m 1.7 years 9.6% (2023: R8.8bn) (2023: R702.0m) (2023: 2.6 years) (2023: 10.2%) SWAP PROFILE WAR Hedged % Swap margin Avera
Slide 45: SA REIT Loan to Value and Net Interest Cover
SA REIT LOAN TO VALUE AND NET INTEREST COVER SA REIT LOAN TO VALUE Net debt LTV SA REIT LTV excl. swap derivatives 42.0% FV interest rate Swaps (Liability) R5.7m 42.0% (2023: 41.9%) (2023: 41.6%) NET INTEREST COVER 1,600,000 2.50 1,400,000 2.07 1 416 423 12.9% 2.00 1,200,000 1 254 562 1.94 1,000,000
Slide 46: Outlook
OUTLOOK SAMSON MOJALEFA | SA CORPORATE AFHCO { REAL ESTATE Ain Hoag
Slide 47: Outlook: 2025 LFL NPI and Distributable Income Growth Guidance
OUTLOOK 2025 LFL NPI Retail ▪ Vacancy to remain at a similar level to 2024 ▪ Escalations > 6.0% have been contracted for 81.0% of leases ▪ Renewals to be marginally positive Industrial ▪ 100% occupancy ▪ Escalations between 6.0% and 7.0% ▪ Overall positive reversions Residential – Afhco & Indluplace
Slide 48: Questions
QUESTIONS gf SAcoRporaTe AFHCO f REAL ESTATE Arcs Housing Company
Slide 49: Appendices
APPENDICES gf SAcoRPoRaTE AFHCO f REAL ESTATE Arcs Housing Company
Slide 50: Distributable Income at a Glance for the Year Ended December 2024
DISTRIBUTABLE INCOME AT A GLANCE FOR THE YEAR ENDED 31 DECEMBER 2024 Dec 2024 Dec 2023 % Rm Rm Variance Net Property Income – Like-for-like 1 088.033 1 019.647 6.7 Net Property Income – Developments 88.885 85.692 3.7 Net Property Income – Acquisitions 288.867 138.796 108.1 Net Property Income – Held
Slide 51: Group Debt Structure – excl fixes
GROUP DEBT STRUCTURE – AT 31 DECEMBER 2024 (EXCL FIXES) 51
Slide 52: Group Debt Structure – incl fixes
GROUP DEBT STRUCTURE – AT 31 DECEMBER 2024 (INCL FIXES) 52
Slide 53: Group Debt Profile at December 2024
GROUP DEBT PROFILE AT 31 DECEMBER 2024 53
Slide 54: Group Debt Structure Swaps at December 2024
GROUP DEBT STRUCTURE SWAPS AT 31 DECEMBER 2024 54
Slide 55: Interest Rate Swap Expiry at December 2024
INTEREST RATE SWAP EXPIRY AT 31 DECEMBER 2024 55
Slide 56: Retail Portfolio
RETAIL PORTFOLIO Portfolio1,2 Portfolio value R7.1 bn 38 Properties Top 10 National tenants exposure GLA 369 295m2 22.2% Grocer GLA GLA 37.9% 70.4% of total Rental income 33.8% 72.6% Cost to revenue (Like-for-like) 46.1% (2023: 45.5%) Lease Expiries 25.0% 120.0% 20.0% 100.0% 80.0% % of GLA 15.0% 60.
Slide 57: Industrial Portfolio
INDUSTRIAL PORTFOLIO Portfolio Portfolio value R3.3 bn 44 Properties GLA 375 825m2 22.2% GLA of total portfolio Cost to revenue (Like-for-like) 28.7% (2023: 29.5%) Lease Expiries 40.0% 120.0% 35.0% 100.0% 30.0% 25.0% 80.0% % of GLA 20.0% 60.0% 15.0% 40.0% 10.0% 5.0% 20.0% 0.0% 0.0% Vacancy Monthly 2
Slide 58: Afhco Portfolio
AFHCO PORTFOLIO Afhco Portfolio1 Indluplace Portfolio Portfolio value R4.2 bn 53 Properties Portfolio value R3.1 bn 127 Properties GLA Apartments 337 516m2 Retail 62 246m2 GLA Apartments 480 611m2 Retail 13 670m2 Cost to revenue (Like-for-like) 54.3% (2023: 55.0%) AFHCO by GLA Indluplace by GLA 2.8%
Slide 59: Commercial Portfolio
COMMERCIAL PORTFOLIO Portfolio Portfolio value R240.4m 2 Properties GLA 21 749m2 1.3% GLA of total portfolio Cost to revenue (Like-for-like) 72.0% (2023: 69.0%) Lease Expiries 25.0% 120.0% 20.0% 100.0% 80.0% % of GLA 15.0% 60.0% 10.0% 40.0% 5.0% 20.0% 0.0% 0.0% Vacancy Monthly 2025 2026 2027 2028 20
SA Corporate Real Estate — FY2024 Earnings Presentation on 6ix