Futuregrowth mall deals ‘boost KZN’

Business leaders in KwaZuluNatal say the acquisition of two malls by Futuregrowth Asset Management’s Community Property Fund (Comprop) is good news for investors, especially after the recent looting and violence in the province.

Comprop, an Old Mutual unit, said on Monday that it bought the two shopping centres in KwaZulu-Natal from Vukile Property Fund and Resilient both JSE-listed real estate investment trusts despite concerns after the unrest in the province and parts of Gauteng where shopping centres were destroyed and vandalised.

The fund now owns the King Senzangakhona Shopping Centre in Ulundi and Murchison Mall in Ladysmith, in addition to the Bridge City Shopping Centre in KwaMashu and the Maxwell Centre in Empangeni. Both were damaged in the July unrest.

The terms of the deal were not disclosed, but the acquisitions take the value of Comprop’s portfolio to more than R5.4bn, with a portfolio of 22 shopping centres in prime locations in townships and rural areas across eight provinces.

‘POSITIVE NEWS’

The Durban Chamber of Commerce and Industry welcomed the acquisition. “Given the recent unrest, we believe this is positive news for the province. As organised business, we are excited to know and see that businesses are still committed to the economic prosperity of KwaZuluNatal,” said CEO Palesa Phili.

The acquisition would lead to economic development for surrounding communities, she said.

“Despite the circumstances, entrepreneurs must take a longterm view and work towards achieving long-term return.

“The chamber has made significant contributions to rebuilding the region, and is continuously working closely with all major stakeholders, including a campaign of rebuilding, reconnecting and reconciling to encourage the participation and partnership of both private and public sectors,” Phili said.

Trade and Investment KZN (TIKZN), a group that lobbies for investment in the province, said the acquisition paves the way for greater opportunities for the SMME sector. “We welcome all investments, particularly those in the property development sector,” CEO Neville Matjie said.

“From our side, we always encourage an integrated strategy when it comes to shopping malls so that those who are in the vicinity, especially emerging black companies, are part of the mall. This leads to skills and business development, plus sustainable outcomes for all.”

Matjie said KwaZulu-Natal was on the rebound after July, noting that the province is hosting the Intra Africa Trade Fair in November. The event is expected to attract direct spend of R235m, contribute an estimated R600m to the region’s GDP and create 1,200 jobs.

Matjie encouraged affected businesses still experiencing delays in insurance claims linked to the unrest to reach out to TIKZN for support.

HEARTENING

Pietermaritzburg & Midlands Chamber of Commerce CEO Melanie Veness said the deal augured well for the region.

“Given the recent unrest and the terrible knock in business confidence associated with it, it is heartening to have investors showing such overwhelming confidence in our province and to have them recognising the opportunities that do actually abound here. Hopefully their investment will spur others on to do the same,” she said.

Smital Rambhai, Comprop’s property manager, said the focus was to continue upskilling members of local communities and creating employment opportunities for individuals and small businesses.

“We look forward to creating further positive community impact through these new acquisitions, while delivering strong stable long-term returns with a low degree of volatility for our investors,” Rambhai said.

“The majority of the Ulundi municipal area consists of commercial farms and the area supports a substantial agricultural community. We believe that the growth in this sector over the short to medium term will continue to create employment along with the growth in population and contribute positively to returns,” he said.

Both centres are near main transport routes in the province.