Growthpoint owns 453 buildings worth R160.1 billion. South Africa's biggest landlord published results for the twelve months to June on Wednesday morning, and the cash it can hand shareholders rose 4.3% a share, which is respectable and not much more. One of those 453 is the V&A Waterfront, half of it Growthpoint's, and it had a considerably better year than that.
The V&A is not a Growthpoint building in the ordinary sense. It is a joint venture owned half each with the Government Employees Pension Fund, through the Public Investment Corporation, and it sits in the accounts as a single property with 264 084 square metres of lettable space. The precinct took R4.35 billion of revenue over the year, and Growthpoint's share of what it paid out rose 19.0% to R964.7 million.
What a waterfront charges
Rent is where the precinct separates itself. Tenants at the V&A paid a weighted average of R499.07 per square metre a month, a figure that bundles in the operating costs and municipal rates they pay back on top of the rent itself. Across the whole of Growthpoint's South African portfolio the same measure comes to R176.00. That is close to a threefold gap, on one landlord's own schedule, between one Cape Town precinct and everything else it owns.
The comparison holds inside the portfolio too. Growthpoint's shopping centres, the strongest of its three ordinary sectors, charge R252.67 per square metre a month, its offices R164.49 and its warehouses and industrial space R82.57. Vacancy at the V&A is 1.0%.
Less landlord, more hotelier
What the precinct earns is also changing shape. Income from the hotels, tourism and leisure businesses the V&A runs itself, rather than lets to somebody else, went from 16% of its total to 20%. The Table Bay has reopened as the InterContinental, a Marriott EDITION opens at the end of October, and a superyacht marina is on the way. Growthpoint says that broadens where its money comes from, which it does, and it also ties more of that money to how many visitors arrive and how much they feel like spending.
The rest of the portfolio did not have the same year. Like-for-like net property income at the V&A rose 10.6%. Gauteng office renewals came in at negative 10.2%, and about 70% of Growthpoint's South African office space sits in Gauteng, where 18.6% of it stands empty.
So the money keeps going to Cape Town. Growthpoint has committed another R1.29 billion to the precinct, R504 million of it inside the next twelve months. Who explains that is still being settled: Estienne de Klerk became group chief executive on 1 July, is recovering from a medical procedure, and Norbert Sasse has taken the job back for another four to six weeks.
