Accelerate Property Fund’s path to a strategic revival

Source: Supplied. Fourways Mall.

Signs of a turnaround are emerging as gearing levels improve and vacancies at Fourways Mall drop to 17.9% from 19.2% in March.

On Monday, the property player's shares surged nearly 7%, buoyed by progress in its asset disposal strategy and the positive trend at its flagship mall.

In its results for the six months ending September 2024, leases were renewed for 32,939m² of the mall's total 178,202m² space. Accelerate noted that 72.6% of these renewals were secured at lower rental rates compared to the expiring terms.

Furthermore, the asset manager is investing in upgrades to Fourways Mall, with approximately R400m in capital expenditure allocated to the asset. This investment will be evenly shared between the owners, Accelerate and Azrapart.

Measures to enhance the mall's performance include a partnership with retail experts Flanagan & Gerard and the Moolman Group. These firms have been engaged to oversee asset and property management on behalf of the owners.

During the review period, Accelerate Property Fund reported a loan-to-value ratio of 46.7%, improved from nearly 50% in March. This was achieved through the sale of five properties, reducing debt by R564m to R3.73bn from R4.42bn. The group plans to further decrease its debt by disposing of an additional five properties.

The group announced that no dividend would be declared for the period as it focused on strengthening its financial position.

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