We come one!

Emira Property Fund has joined forces with retail property specialist ONE Property Holdings to grow its retail assets together and create a larger low LSM retail portfolio.  For this venture, Emira and ONE will launch a specialised fund by the name of Enyuka Property Fund.

Emira will contribute its 15-asset rural retail portfolio to the new associate business, which is dedicated to growing a significant retail portfolio. ONE will contribute its development pipeline of similar lower LSM retail assets. The transaction is subject to normal suspensive conditions including Competition Commission Approval, and this is expected to be forthcoming in the near future.

Housed in the new associate business, these properties will deliver returns to Emira at the same income yield they currently achieve in its portfolio, together with annual escalations up to a pre-set level. The excess above the set benchmarks are shared within the venture. What’s more, Emira will get the added benefit of returns from the development pipeline above a lower level target benchmark together with a meaningful participation in an actively-managed and growing base of rural retail assets.

Striking

The Apex on Smuts – a new, Manhattan-style apartment building in the heart of Rosebank, Johannesburg – has proven to be a market-leading residential development in one of the city’s hottest urban nodes. With its prominent position and striking, contemporary architecture, this recently-completed building offers the modern city dweller everything they could want in chic, urban living – and buyers are taking notice. Designed by Messaris Wapenaar Cole Architects (MWCA) the arresting, wedge-shaped building is hard to miss.

 

REIT to open doors for Liberty

Before the end of 2016, Liberty will have invested half of its portfolio on the Johannesburg Stock Exchange as a Real Estate Investment Trust (REIT), which will be called Liberty Two Degrees.

 

The development will enable the investor in the “the richest square mile in Africa” to continue to invest and grow this portfolio to the benefit of its policyholders and other investors.

 

Liberty is looking to raise up to R4-billion in new capital at listing. Liberty will also offer existing policyholders an exclusive opportunity to switch up to R3-billion of their current direct property holding into a new property portfolio that will invest in the listed entity. The REIT will have the ability to borrow and raise equity to create further growth opportunities and enhance returns for its shareholders. Liberty Two Degrees will be managed by the same team within Stanlib that has managed the Liberty Property Portfolio (LPP) for many years under the leadership of Amelia Beattie as the CEO.

 

On a successful listing of the REIT on the JSE, Liberty expects the Liberty Property Portfolio to increase in value by between three percent and five percent. This should lead to a direct increase in the amount held by policyholders.

 

Commercial & Industrial Property News learns that Liberty REIT will also invest in several markets in the rest of Africa, focusing on quality assets with a retail pedigree and high-end commercial space, targeting multi-national anchor tenants. Total rest of Africa opportunities will not exceed 10% of the portfolio and selected jurisdictions will ensure there can be adequate repatriation of distributions to the Liberty REIT investor base. These additional geographies allow investors to benefit from the growth opportunities the continent offers; provide long-term capital appreciation upside; and further diversify exposure of the portfolio.

 

The Liberty property portfolio has consistently outperformed its CPI of more than the five percent benchmark over a rolling five year period since its launch 30 years ago. Its defensive retail properties dominate at around 87% of total market value of the portfolio, and 47% by Gross Lettable Area (GLA), supported by mixed use, office and industrial space.

 

The portfolio’s prime and super-regional retail real estate assets are strategically located in South Africa’s major economic nodes benefitting from tourism and exposure to the high LSM domestic consumers. These properties are occupied by a sound tenant base featuring leading international and local brands.

 

At present, the Sandton City Complex comprises around 35% of the total portfolio value, followed by Eastgate Mall at 31% and the interest in Melrose Arch, Liberty Midlands Mall and Nelson Mandela Square at 7% each.

 

Eastgate shopping centre is a mixed-use development that has 142 825 square metres (m2) of gross leasable area with 293 shops, 5 564 parking bays and a R204 spend per head. Strategic priorities at the centre include completing the Eastgate phase II and Eastgate Office Tower project.

 

Meanwhile, the mixed-use Melrose Arch development provides 108 796 square metres (m2) of office space, 42 451 m2 of retail, 16 847 m2 of hotel space, 6 071 m2 of showroom space, 4 217 m2 of venue and residential and 4 258 m2 of health space.

 

Liberty Midlands Mall provides 55 322 m2 of GLA, with 163 shops and 2 552 parking bays. The spend per head at this asset is currently R213 per head. Strategic priorities at the mall include executing the third phase of development there and a leasing strategy. At the same time, the company will reduce vacancies and bolster food and entertainment components.

 

Nelson Mandela Square currently offers 38 783 m2 of GLA, and is a mixed use development comprising 61 shops and 1 923 parking bays. Its refurbishment was completed at the end of 2015

 

A refurbishment was completed at the end of 2015, and Stanlib is now in discussions with international tenants. It will also soon strengthen the upper level with destination retail and market the square for prime events, such as African Fashion International.

 

Complementing this asset is Sandton Centre Shopping centre, which offers 198 602 m2 of GLA. It features 311 shops and 8 110 parking bays. Average spend per head is R270. Priorities at this development include upgrading the Checkers Court and cinema level, completing the Virgin Active and leasing of the atrium on of the fifth floor.

 

The Liberty Promenade Mall comprises 73 400 m2 of GLA of retail space. There are 162 shops and 3 108 parking bays, and spend per head is R130. Strategic priorities include attracting more national retailers and right-sizing retail premises.

 

FM skills for sub-Saharan Africa

 

Cushman & Wakefield, a leading global real estate services firm, has entered into an exclusive affiliate arrangement across sub-Saharan Africa with Excellerate Property Services, the holding company behind leading brands including property and facilities manager JHI, to offer a comprehensive range of real estate services across the region.

The new venture, which will be branded Cushman & Wakefield Excellerate, provides an integrated platform serving the sub-Saharan African continent from an established network of 32 offices in 11 sub-Saharan countries. These include 22 offices across South Africa, the largest African commercial property market, as well as strategically important locations including Ghana, Kenya, Nigeria and Zambia.

 Excellerate Property Services has over 13 000 employees, more than USD450-million in transaction volume, USD142-million revenues, 90-million square feet of assets under management, 30-million square feet of facilities under management and operates under brands including JHI and Excellerate Facility Management.

Green building benefits employees

 

Benefits of the green building commitment extend far beyond just enabling the achievement of the group’s reduction targets; they also deliver enhanced employee productivity. Howard Rauff, head of portfolio and facilities management at Nedbank   points to research done into three of Nedbank’s green buildings by Professor Andrew Thatcher, the chair of industrial and organisational psychology at Wits University as evidence of these improvements.

The research found statistically significant increases in perceived productivity and wellbeing levels by numerous employees who moved into the more sustainable work environments offered by the green buildings.

Rauff argues that these employee benefits, coupled with the proven long-term environmental and economic sustainability advantages present a compelling case for any organisation to make green buildings a core part of its sustainability strategy. “While some businesses may still think that green buildings are purely a nice to have, Nedbank’s example of the long-term environmental, health and financial advantages they unlock should easily put these misperceptions to bed,” he concludes, “particularly since the substantial operating cost savings they deliver over time mean that the relatively small premium required to create them could easily be recouped within a couple of years, after which the vast array of sustainability benefits are certain to add immense value to any business and its stakeholders.”

 

 

 

Timber!

South Africans have become so comfortable working in buildings made of brick and mortar that the eco-friendly and sustainable traits options of a wood structure are not always the natural choice.

 

This is the view of Peggy Sithole of Workplace and Entrepreneurship Talent Solutions South Africa.

 

“South Africa is a developing country and should be very progressive within a growing democracy. We should be a country that truly embraces evolution, breeding innovation and getting on with the latest trends in the pursuit of growing the economy. We need to embrace change with diversity and exploring untapped territories in the building and construction industry,” says Sithole.

 

She quotes United Kingdom architect, Andrew Waugh who stated, “The 17th century was the age of stone. The 18th century was the peak of brick. The 19th century was the era of iron. The 20th century was the century of concrete. The 21st century will be the time of timber!”

 

Sithole says wood should be taking over from steel and concrete as the “architectural wonder material of the 21st century”, with architects praising its sustainability, quality and speed of construction.

 

So, why the delay in seeing more structures from wood, despite the growing international trend in using the material?

 

Sithole says South African architects should be taking a more proactive approach to showcasing wood as the alternative to conventional building materials.

 

Internationally, architects are proving to be the biggest drivers of this material. A sound example is Canadian Michael Green, who has urged built environment professionals to use more of the material. Noticeably, is strong motivation for the material in the 2012 edition of his title in an article entitled The Case for Tall Wood.

 

Noticeably, is the “green” building movement in the country that continues to drive more sustainable thinking around the embodied energy of structures.

 

Richard Stretton, founder of Koop Design Architects, has built, designed and manufactured using timber throughout is professional life.

 

He says in the last decade, technological advances have allowed for tall – all timber – structures to be designed and built.

 

Stretton agrees that timber can play a critical role in helping the building environment achieving carbon neutrality. “Buildings can provide warm comfortable environments with modern amenity and the integrity to achieve very tall structures,” he says.

 

However, he notes that one of the biggest challenges is achieving a co-oridinated effort from end users to ensure legislative change and support for fire protection of these buildings.

 

Werner Slabbert of Rustic Homes concurs.

 

He says timber has the lowest embodied energy and grows in sustainably managed plantations. It is also a renewable building material.

 

It is 100% recyclable and has a low carbon footprint. A cubic metre of timber contains a ton of embodied carbon, while the timber frame has the ability to achieve the mandatory R values.

 

In addition, it provides a sound thermal performance. Softwood’s thermal value is R0,03 per millimetre, while a typical log cladded home of is R1,5 per millimetre.

 

This can be attributed to the material being warmer in winter and cooler in summer resulting in lower heating or cooling costs. Meanwhile, timber frame systems allow for greater flexibility in the use of insulating material.

 

 

There are already sound examples of building with the material in the country. Noticeably, they employ the Novatop system comprising large panels made from cross-laminated timber.

 

These components are manufactured from dried spruce slats that have been put together in layers. The layers form an angle of 90 degrees, with the number of layers differing and determining the final thickness of the panel.

 

The timber is dried to a moisture content of about eight percent. This ensures high stability of components and prevents them from cracking. The slats are glued to each other on all faces in the production process. Polyurethane adhesives are used for the manufacture of wooden load-bearing internal and external building components.