Wrap Text
Pre-close operational update and updated guidance
HYPROP INVESTMENTS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1987/005284/06)
JSE share code: HYP
ISIN: ZAE000190724
JSE bond issuer code: HYPI
(Approved as a REIT by the JSE)
("Hyprop" or "the Company" or "the Group")
PRE-CLOSE OPERATIONAL UPDATE AND UPDATED GUIDANCE
Following the publication of Hyprop's interim results for the six months ended 31 December 2024
("HY2025") on 13 March 2025, the Company is pleased to provide an operational update for the five
months ended 31 May 2025 ("the period").
INTRODUCTION
Hyprop, a JSE-listed specialist retail fund, delivered a strong performance in the period despite
continued volatility in the global economy. Demand for space in Hyprop's centres in South Africa
("SA") and Eastern Europe ("EE") remains resilient, contributing to year-on-year growth in tenant
turnover and trading density.
Hyprop's strategy is to create spaces and connect people by owning and managing dominant retail
centres in mixed-use precincts in key economic nodes in SA and EE. Its focus is delivering total returns
by strategically allocating capital to generate both yield and return on investment.
Since the Group embarked on its new strategic journey in 2019, it has made significant progress. Some
of the key milestones of the past six years are the implementation of the Hystead Liquidity Event when
Hyprop took control of the EE properties and optimised the EE portfolio's capital structure; the
settlement of dollar equity debt in the sub-Saharan Africa portfolio; and the sale of the sub-Saharan
Africa portfolio in return for shares in Lango Real Estate Limited, a pan-African real estate investment
company.
Over the same six-year period, Hyprop reduced its LTV from a peak of 52% to 36.3%, reduced its euro
equity debt from €403 million to €87 million, simplified its structure, improved its credit rating, and
continuously invested in enhancing the attractiveness and sustainability of its centres in SA and EE.
SOUTH AFRICA PORTFOLIO
Tenant turnover rose 7% in the five months ended 31 May 2025 compared with the same period in 2024
while trading density increased by 10.2%. The portfolio performed better in April and May due to the
public holidays. Foot count rose by 0.1% during the period, while collections were 9.4% higher. At
31 May 2025, retail vacancies were 3.9%, primarily due to Edgars' rightsizing its stores. The vacancies
provide flexibility to secure new tenancies to satisfy tenant demand and meet our shoppers'
expectations.
The weighted average reversion rate remains in positive territory at 2.9%, while the retail new deal
reversion rate was very pleasing at 13.5%.
The SA portfolio's key trading metrics for the period are detailed below:
Total for 5-
month
Trading Metric Year Jan Feb Mar Apr May period
Tenant Turnover 2023 2 017 837 1 918 302 2 067 938 2 167 830 2 166 709 10 338 618
(R'000) 2024 2 111 176 2 038 679 2 174 087 2 147 760 2 173 753 10 645 454
2025 2 244 792 2 078 904 2 317 966 2 330 992 2 412 738 11 385 392
Variance % 2024 vs 2023 4.6% 6.3% 5.1% -0.9% 0.3% 3.0%
Variance % 2025 vs 2024 6.3% 2.0% 6.6% 8.5% 11.0% 7.0%
Trading Density 2023 3 188 3 041 3 278 3 438 3 444 3 278
(R) 2024 3 304 3 200 3 392 3 354 3 400 3 330
2025 3 579 3 326 3 755 3 782 3 915 3 670
Variance % 2024 vs 2023 3.6% 5.2% 3.5% -2.5% -1.3% 1.6%
Variance % 2025 vs 2024 8.3% 4.0% 10.7% 12.8% 15.1% 10.2%
Foot Count ('000) 2023 6 887 5 995 6 703 6 728 6 561 32 874
2024 7 266 6 607 7 248 6 703 6 825 34 650
2025 7 079 6 249 7 167 7 005 7 173 34 674
Variance % 2024 vs 2023 5.5% 10.2% 8.1% -0.4% 4.0% 5.4%
Variance % 2025 vs 2024 -2.6% -5.4% -1.1% 4.5% 5.1% 0.1%
Retail Vacancy
(%) 2023 1.5% 1.4% 1.5% 1.8% 1.5% -
2024 1.3% 1.4% 1.4% 1.9% 1.9% -
2025 3.6% 3.2% 3.9% 4.1% 3.9% -
Collections 2023 233 189 285 638 322 134 286 955 259 228 1 387 144
(R'000) 2024 262 864 304 810 311 642 310 989 303 944 1 494 248
2025 325 371 325 126 303 439 333 774 346 296 1 634 006
Variance % 2024 vs 2023 12.7% 6.7% -3.3% 8.4% 17.2% 7.4%
Variance % 2025 vs 2024 23.8% 6.7% -2.6% 7.3% 13.9% 9.4%
Vehicle Count 2023 1 807 424 1 624 720 1 777 261 1 773 483 1 784 024 8 766 912
2024 1 777 251 1 663 725 1 798 363 1 696 408 1 731 577 8 667 324
2025 1 811 314 1 627 814 1 835 194 1 758 049 1 848 231 8 880 602
Variance % 2024 vs 2023 -1.7% 2.4% 1.2% -4.3% -2.9% -1.1%
Variance % 2025 vs 2024 1.9% -2.2% 2.0% 3.6% 6.7% 2.5%
Table Bay Mall's retail vacancy and collections are included from April 2024.
Western Cape
Canal Walk continues to evolve with strong leasing activity and significant store upgrades. Notable
additions include Ayana, which is a conversion of the former Ackermans Women, as well as PAUL
Bakery and Restaurant. Additionally, Reebok relocated its flagship store, and The Fix relaunched in a
larger space that now features its latest specifications and offerings. Edgars downsized from 11 000m²
to 5 400m², which made space for a Jet flagship store, a new Home Tech Sleep, and soon to-be-
completed Incredible Connection flagship offering. Edgars is performing well in the new downsized
footprint, which includes a world-class fragrance and cosmetics offering. Overall, leasing activity has
been positive, with office demand increasing significantly.
Somerset Mall welcomed several new names: Silki, Blades & Triggers, a Nespresso kiosk and Sterns.
The Phase 2 expansion of the centre is progressing well, and terms have been agreed with the following
stores which will occupy the expanded area: Game, Edgars, Office London, Computer Mania, Total
Sports, a variety of athleisure and affordable luxury brands such as New Balance, Burnt, Curve Gear,
and Napapijri, an international outdoor apparel brand.
Four new stores opened at CapeGate in the period: Skechers, Turkish Doner Haus, Ayana and Group
1 Nissan. Alongside these additions, SpecSavers, Simply Asia, Ster-Kinekor, and Ouhout Furnishers
have undergone refurbishments. The development of satellite offices around the centre on a leasehold
basis is still in the early stages, but it is gaining traction and already attracting potential tenants.
At Table Bay Mall, De Jagers and Blades & Triggers opened new stores. Additionally, four more stores
are set to open in the next three months: M&B, Kingsmead Shoes, Turkish Doner Haus and Yuppiechef.
Krumble and Wild Plum, which were previously tenants of the Saturday market moved into permanent
locations. Ballisimo and Xpresso have also relocated to new premises. The centre has submitted a
planning application to add 20 000 m² of bulk and has completed the installation of backup generators.
Table Bay Mall is installing free Wi-Fi and has extended its trading hours in response to shopper
demand.
Gauteng
Rosebank Mall enhanced its tenant mix by adding six new stores: Cannafrica, One Stop Travel &
Tours, Drip4Life (IV drip experts), Glow Theory (Korean beauty store), John Craig and Cajees (watch
and accessories retailer). Telecommunication operators Telkom and Cell C have relocated and
refurbished their stores. Sustainability has been boosted with the installation of three-day potable water
backup tanks and the dual-fuel generator and battery storage power system. Upgrades of the
passageways on levels 1, 3 and 8 in The Mall Offices were also completed during the period.
Hyde Park Corner saw the opening of Society 1840, a luxury salon and day spa, along with a
"Hydraulics in the Park" store. In August, the centre will be significantly enhanced with the opening of
a new Checkers FreshX store. Several revamps have been completed or are underway, including Charles
Greig, Sorbet Man and Sorbet Beauty.
Clearwater Mall welcomed a Mochachos Restaurant on the upper level, which has been trading
exceptionally well. It also introduced two new kiosks: Drip4Life and Spring Sport. The Fix relocated
to a new space next to Foschini, boosting its visibility and creating a more cohesive fashion cluster.
Other stores including Legit, Queenspark and Refinery have also relocated, while several outlets, such
as Levi's, Poetry and Exclusive Books were refurbished. The centre has also added Plush Car Wash.
At Woodlands, the Ouhout Furnishers pop-up store has been converted into a permanent store
combined with Pencil & Oak. Other tenant additions include Handelhuis, Porter & Craft and Ayana.
The Pick n Pay supermarket has downsized from 5 600m² to 3 636m² and a new lease agreement signed
with a franchisee.
The Glen opened four new stores: Petshop Science, Shaheeds Grab & Go, Spicy Den and Osmanli Oud
(a perfume kiosk). Vodacom launched a visually striking and innovative upgrade and Side Step
relocated its store. The centre completed its egress and ingress project in April and is currently
refurbishing its exterior signage.
EASTERN EUROPE PORTFOLIO
Our EE portfolio experienced continued growth during the period, highlighting the dominant market
positions and relevance of these centres. Tenant turnover increased by 3.5% and trading density rose by
4.0%, despite a decline in foot count of -3.3%. Tenant demand remains robust, as reflected in the modest
0.1% vacancy rate at 31 May 2025.
The EE portfolio's key trading metrics for the period are detailed below:
Total for 5-
month
Trading Metric b Year Jan Feb Mar Apr May period
Tenant Turnover 2023 40 763 36 889 41 887 47 031 48 557 215 129
(€'000) 2024 42 933 40 251 47 227 50 653 51 426 232 489
2025 43 800 40 316 48 017 51 890 56 631 240 654
Variance % 2024 vs 2023 5.3% 9.1% 12.7% 7.7% 5.9% 8.1%
Variance % 2025 vs 2024 2.0% 0.2% 1.7% 2.4% 10.1% 3.5%
Trading Density 2023 246 224 251 283 293 260
(€) 2024 257 242 280 300 304 277
2025 261 240 288 310 339 287
Variance % 2024 vs 2023 4.3% 7.8% 11.4% 6.0% 3.8% 6.5%
Variance % 2025 vs 2024 1.6% -0.4% 2.8% 3.2% 11.3% 4.0%
Foot count ('000) 2023 2 242 1 999 2 167 2 245 2 401 11 054
2024 2 182 2 027 2 243 2 245 2 243 10 939
2025 2 113 1 935 2 131 2 156 2 244 10 579
Variance % 2024 vs 2023 -2.7% 1.4% 3.5% 0.0% -6.6% -1.0%
Variance % 2025 vs 2024 -3.1% -4.5% -5.0% -4.0% 0.1% -3.3%
Vacancy (%) 2023 0.6% 0.6% 0.4% 0.8% 0.3% -
2024 0.3% 0.2% 0.2% 0.2% 0.1% -
2025 0.2% 0.2% 0.1% 0.1% 0.1% -
Collections (€'000) 2023 7 343 8 134 8 669 7 454 7 925 39 526
2024 7 798 7 642 8 728 8 458 8 040 40 666
2025 9 390 10 625 8 977 8 644 8 782 46 419
Variance % 2024 vs 2023 6.2% -6.1% 0.7% 13.5% 1.5% 2.9%
Variance % 2025 vs 2024 20.4% 39.0% 2.9% 2.2% 9.2% 14.1%
Vehicle Count 2023 354 846 321 264 357 601 325 970 363 681 1 723 362
2024 367 240 340 767 379 186 377 807 362 427 1 827 427
2025 368 328 343 317 341 424 365 350 373 328 1 791 747
Variance % 2024 vs 2023 3.5% 6.1% 6.0% 15.9% -0.3% 6.0%
Variance % 2025 vs 2024 0.3% 0.7% -10.0% -3.3% 3.0% -2.0%
In Croatia, City Centre one East benefitted from several changes during the period. A new Nespresso
kiosk was opened, along with Gligora, a cheese and deli store, and Harissa, which specialises in spices
and tea. Additionally, a Peek & Cloppenburg pop-up was introduced to pave the way for Sephora's
market entry next year, alongside the opening of JD Sports. The C&A store was completely refurbished
and Snipes relocated to larger premises. Sancta Domenica rebranded as Big Bang, marking a significant
milestone in the transformation of Sancta Domenica in the Croatian market.
City Centre one West continues to broaden its retail offerings and enhance visitors' shopping
experience. Big Bang, previously Sancta Domenica relocated to a bigger store. Levi's refreshed its
interior design and both Mango and the Foodie restaurant are scheduled for refurbishment between June
and September 2025. Ongoing projects, including the replacement of all ceramic tiles and the upgrade
of interior and exterior lighting to LED fixtures, will elevate the centre's aesthetics.
In Bulgaria, The Mall opened a new mono-brand store for Jack and Jones, while US Polo moved to a
larger space with its latest concept. Tommy Hilfiger underwent a complete revamp to reflect its latest
look and design. Bulgarian ladies' fashion retailer Dika upgraded its store. To improve the tenant mix,
Lilly Drogerie relocated to level -2 to make space for the French lingerie brand Etam, which is set to
open by late November 2025. Several new stores have opened, including niche perfumery Dubai Palm
Jumeirah, Smart Station (phone accessories), Kozunut (doughnuts), and a Nespresso boutique kiosk.
Various projects have been completed to enhance the sustainability and efficiency of the centre. The
lighting system has been fully upgraded to energy-efficient LED fixtures, and all water meters have
been replaced to enable remote meter reading, improving the accuracy of water consumption
monitoring. Additionally, the roof structures over the ramps leading to the underground parking levels
have been replaced with new, more durable materials.
Recent highlights at Skopje City Mall include the grand openings of Ehoreca, the official Nespresso
reseller in North Macedonia, and the new Gerry Weber mono-brand store that opened in February 2025.
The expansion of the Setec Premium electronics store is underway. Upcoming openings include Merkur,
a home and décor store, and Green Salad. Sony will also be relocating to introduce its newest concept
in a smaller format store. The centre's open-air rooftop Summer Cinema in partnership with Cineplexx,
is set to attract more visitors from across the country in the coming months.
ENVIRONMENTAL
Energy
The dual-fuel generator and battery storage project at Rosebank Mall has been completed. The new
system enables the centre to manage energy costs during peak periods through energy arbitrage, as well
as maintain full backup power, ensuring a seamless transition from municipal power to battery power
during outages. Provided the actual benefits of this battery solution are in line with our expectations,
we will consider installing battery backup systems in the rest of the SA portfolio.
Following further investigation and feasibility studies of Power Purchase Agreements (PPAs), Hyprop
has decided not to use PPAs for on-site solar-PV plants due to the advantages and flexibility of owning
the solar-PV. As a result, Hyprop is currently tendering rooftop solar-PV installations for The Glen
(3 295kWh) and CapeGate (5 337kWh). Regulatory submissions have been made for solar-PV
installations at Somerset Mall (4 200kWh) and Canal Walk (6 650kWh). Additionally, a request for
proposals will be issued to the energy wheeling market in June 2025 to augment existing and new solar-
PV installations.
Water
At Woodlands and Clearwater Mall, the first phase of replacing HVAC units (air conditioning) with air-
cooled systems has commenced. Additionally, three-day potable water backup tanks and pumps have
been installed at all Gauteng centres, with similar initiatives set to start soon in the Western Cape.
Waste
Organic waste recycling initiatives have proven highly effective, with five centres (Canal Walk,
CapeGate, Somerset Mall, The Glen and Woodlands) achieving net zero waste status. A total of 1 020
tonnes of organic waste were successfully diverted from landfills in the period, representing a 255-
tonne increase over the same period in 2024. The recycling rate achieved was 76% by mass.
BALANCE SHEET, CAPITAL AND CASH FLOW MANAGEMENT
The Group's balance sheet remains strong alongside its key treasury metrics and liquidity. Cash
collections for the period exceeded 100% of billings mainly as a result of collection of turnover rentals
for the year ended 31 December 2024 in the EE portfolio.
The LTV ratio improved from 36.3% in December 2024 to 34.2% following receipt of the R808 million
of capital raised in June 2025 and the interest cover ratio remains stable at 2.6 times, providing ample
headroom compared to banking covenants and gearing flexibility.
Hyprop has a strong liquidity position, with R1.2 billion of cash and R2.2 billion in available bank
facilities, after receipt of the capital raise proceeds.
Regarding the rand-denominated debt, term and revolving credit facilities totalling R1.7 billion which
were due to mature in the 2026 financial year have been refinanced early at lower margins (savings of
between 31 and 85 bps). €5 million of the €20 million euro-denominated equity debt term facility which
was due to mature in July 2025, was settled from existing cash and the remaining €15 million was
refinanced for 18 months with a reduction in margin of 18 bps.
In April 2025, the Group successfully raised R450 million in 3.5-year and 5-year terms through a private
placement of bonds under its DMTN Programme. Following this, in May 2025 Hyprop raised a further
R750 million in 3.5-year and 5-year terms via a public auction at margins of 117 bps and 125 bps,
respectively. In addition, R808 million of equity was raised through an accelerated book build in early
June 2025, the financial effects of which are earnings per share neutral on an annualised basis. The
proceeds from the accelerated book build are earmarked for the potential MAS transaction (see below),
or, in the absence of the MAS transaction, will be allocated to reducing debt in the short term and to
fund asset management initiatives, organic growth opportunities, further solar-PV projects and new
investments within Hyprop's existing operations.
As at 31 May 2025, 83% of the Group's interest rate exposure was hedged, with an average hedge
duration of 1.5 years. 65% (by nominal value) of rand interest rate hedges consist of interest rate caps
and collars providing some benefits from the reduction in interest rates, with the remainder of the
interest rate hedges being swaps.
Hyprop is continually evaluating its portfolio with a view to allocating capital to the Western Cape and
Eastern Europe, where we see better risk-adjusted opportunities.
UPDATE ON POTENTIAL MAS TRANSACTION
In line with its diversification strategy, and specifically its key priority of securing new growth
opportunities in Eastern Europe, Hyprop announced on 26 May 2025 that it was evaluating acquiring a
controlling stake in MAS P.L.C ("MAS"). If pursued, this would be through a conditional voluntary
bid, offering MAS shareholders the option to exchange their MAS shares for either Hyprop shares or
cash.
Hyprop possesses strong regional management expertise in EE and is well-positioned to drive value
creation through collaboration with MAS' property and asset management teams in the medium to long
term. Hyprop would also leverage its experience as an established, well-managed REIT with a track
record of strong corporate governance, operational strength, access to funding and treasury expertise,
and a proven ability to resolve complex shareholder and joint venture arrangements. This approach
includes accelerating MAS' progress towards resuming regular dividend payments.
To support the cash portion of the voluntary bid, Hyprop raised a total of R808 million via an accelerated
book build at a price of R42.50 per share. Additional cash required for any voluntary bid would be
raised through a vendor consideration placement.
Any voluntary bid will be subject to conditions, including the approval of Hyprop shareholders, to
protect the interests of Hyprop and its shareholders and meet all applicable requirements. If a voluntary
bid does not become unconditional, it will lapse and Hyprop will not acquire any MAS shares.
Updates regarding the potential voluntary bid will be provided in due course.
IN CLOSING AND UPDATED GUIDANCE
Hyprop is in a strong financial and operational position, underpinned by a clear strategy, strong
corporate governance, a proven track record, a healthy balance sheet and a competent management
team. With resilient and dominant portfolios in both SA and EE, the Group will achieve growth in
distributable income for the year ending 30 June 2025 within the guidance range provided in September
2024 of an increase of 4% to 7% from FY2024.
As a result of the additional 19 million shares (5% of the total number of shares in issue) issued in June
2025 through the accelerated book build, which are not time-weighted when calculating distributable
income per share ("DIPS"), the guidance for DIPS for FY2025 is adjusted by 5% to a change in DIPS
of -1% to +2% from FY2024.
Hyprop is confident of delivering strong growth in the coming financial year through improved
operational performance of its portfolios, including benefits from solar and other energy projects
anticipated to come on stream, a reduction in interest costs and the benefits from deploying the
additional R808 million of capital raised in June 2025 (even in the absence of the MAS transaction).
As a Group, we have established the following strategic priorities that guide our efforts:
1. Drive new and organic growth opportunities in our focus areas
2. Ongoing repositioning of the SA and EE portfolios to maintain their dominance and retain
and grow market share
3. Annual reviews of the portfolios to ensure we retain the right properties and/or recycle capital
where appropriate
4. Implement sustainable solutions to reduce the impact of the infrastructure challenges we face
in South Africa
5. Ensure our balance sheet is robust.
With these priorities in place, Hyprop is well-positioned to pursue further organic and new growth
opportunities that will deliver long-term value for all stakeholders. Our focus is on creating retail spaces
that connect people by providing retail excellence for our tenants and shoppers alike while unlocking
value through initiatives within our existing SA and EE portfolios.
Shareholders should note that the guidance above is based on the assumptions stated in our FY2024
annual results, is subject to change, certain assumptions may not materialise, plans may change, and
unanticipated events and circumstances may affect the Group strategy or the actions it takes.
The guidance has not been reviewed or reported on by the Company's auditors.
A virtual presentation and Q&A session will be hosted by SBG Securities on Thursday, 26 June 2025
at 10:00 am SA time. Please register here https://events.teams.microsoft.com/event/8fb29b82-a85f-
4e6d-a99c-080c19cc2a97@7369e6ec-faa6-42fa-bc0e-4f332da5b1db if you wish to join the
presentation. A recording of the presentation will be available on Hyprop's website afterwards.
Hyprop's annual results for the year ending 30 June 2025, are scheduled to be released on
16 September 2025.
26 June 2025
Sponsor
Java Capital
Date: 26-06-2025 08:00:00
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