Fu­ture growth LOOKS BRIGHT

CityPress - - Business -

Fu­ture­growth As­set Man­age­ment’s Com­mu­nity Prop­erty Fund (CPF) de­liv­ered 24.3% for the 12-month pe­riod end­ing De­cem­ber 2016.

This was the sec­ond con­sec­u­tive year of good re­turnsstrong growth, well ahead of South Africa’s listed prop­erty sec­tor’s re­turn of 10.20% for the same pe­riod.

Spe­cial­ist in­vestor Fu­ture­growth As­set Man­age­ment man­ages around R170 bil­lion of as­sets on be­half of our in­vestors.

The CPF has been run­ning for over 20 years and makes strate­gic ac­qui­si­tions of shop­ping cen­tres in town­ships and ru­ral ar­eas.

CPF port­fo­lio man­ager Smi­tal Ramb­hai says great ef­fi­cien­cies drove the fund’s im­proved re­turns.

“The main driv­ers were strong rental-in­come growth, a re­duc­tion in va­can­cies, bet­ter con­trol of ex­penses and ad­di­tional sources of in­come from pro­mo­tions and ad­ver­tis­ing,” he says. “We’ve also seen an im­prove­ment in the qual­ity of the ten­ants, which re­duces risk for the in­vestor.”

He added that de­mand for rental space in the CPF cen­tres con­tin­ues to be strong, and plans are un­der­way to ex­pand some of the cen­tres ow­ing to this strong de­mand from ten­ants.

“In 1996, when the fund was launched, no one was in­ter­ested in fi­nanc­ing town­ship shop­ping cen­tres and they were a no-go zone for devel­op­ers. Things have changed since then, and Fu­ture­growth con­tin­ues to reap the ben­e­fits of be­ing among the first to in­vest in the town­ship sec­tor on be­half of its clients,” he says.

The un­listed fund has a low cor­re­la­tion to fi­nan­cial mar­kets and ex­pe­ri­ences less volatil­ity than the listed sec­tor. This makes the fund suitable for pen­sion funds seek­ing con­sis­tent, long-term, risk-ad­justed re­turns for their mem­bers.

“Peo­ple will al­ways need to buy food, cloth­ing and house­hold items and have ac­cess to key ser­vices,” says Ramb­hai. “Our shop­ping cen­tres cater for these ba­sic needs, and be­cause they are con­ve­niently lo­cated close to trans­port nodes, con­sumers are likely to con­tinue spend­ing their time and money here.”

New prop­erty man­agers were ap­pointed in 2015 and have been able to ex­tract bet­ter value from the prop­er­ties, which is demon­strated by the fund’s out­stand­ing per­for­mance over the last two years.

The fund cur­rently owns 18 shop­ping cen­tres across South Africa and has de­liv­ered sig­nif­i­cant so­cial ben­e­fits to the sur­round­ing com­mu­ni­ties.

BUILD ME AN ARCH Diep­sloot Mall in Jo­han­nes­burg

BRIDGE THE GAP Bridge City Mall in KwaMashu

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.