Business overview

Operating context and response

South Africa (value drivers: South African portfolio and Waterfall development)
Operating environment     Property trends     RISKS AND OPPORTUNITIES
  • Low growth in weak domestic economy
  • Increased competition for capital
  • Constrained consumer spend
  • Cost and availability (especially in Western Cape) of water
  • Cost and availability of electricity
  • Illegal land invasions
  • Increased community activism
    
  • Oversupply of office space in certain nodes resulting in high vacancies and negative rent reversions
  • Retail spending under pressure
  • Potential tenants delay decisions
  • Scarcity of experienced and skilled property professionals
  • Investments in renewable energy
  • Increased focus on green buildings
    

Meeting shareholder expectations

Emerging markets

Cost and availability of water supply

Delivery of Waterfall development

B-BBEE score

Cost and availability of electricity

Liquidity

Land invasion

Stakeholder activism
+ Positive — Negative          
Our response          
We develop green buildings, focused on low cost of occupation
Our relationships with tenants are increasingly important to ensure their retention
We are proactively assisting our retail tenants, eg with marketing, taking back or resizing lettable areas and ensuring optimal tenant mix
We have a strong in-house brokerage team, supporting tenants in their decisions
Our focus in corporate social investment is education and training, specifically for disadvantaged individuals
We are developing corporate consolidations as a cost-effective solution for our tenants
Defensive and dominant retail and mixed-use properties
Well established Waterfall precinct, with development momentum		    
       
 
Rest of Africa (value driver: Rest of Africa retail investments)
Operating environment     Property trends     RISKS AND OPPORTUNITIES
  • Dollar strength against local currencies
  • Higher commodity prices
  • Declining interest rates and inflation
  • Challenging operating environment
    
  • Limited tenant options available
  • Competition from informal trading
  • Decline in vacancies
  • Increase in arrears
    

Meeting shareholder expectations

Emerging markets

Liquidity
+ Positive — Negative          
Our response          
AttAfrica has an experienced team on site and our co-shareholders are experienced property investors    
       
 
Europe (value driver: investment in MAS)
Operating environment     Property trends     RISKS AND OPPORTUNITIES
  • Euro strength against rand
  • Lower economic growth in Western Europes
  • Higher growth expectations in Central and Eastern Europe (CEE)
  • Potential increase in euro interest rate
    
  • High asset prices in Western Europe make yield-accretive acquisitions challenging
  • CEE region still offers development opportunities for experienced operators
    

Meeting shareholder expectations

Emerging markets
+ Positive — Negative          
Our response          
We have secured euro funding using our MAS investment as security to create a natural foreign currency hedge
Attractive growth prospects in MAS distributions give us a rising diversified income stream
MAS has an experienced team, a growing income-producing portfolio, gearing capacity and the ability to recycle capital from mature assets to fund its large development pipeline		    
       

Amrod, Waterfall Logistics Hub