“During the six-month period under review, new leases and renewals with a total area of 147,724m² and a contract value of 516.1 million rand were concluded. Seventy-two per cent of leases to be renewed were renewed or are in the process of being renewed,” it said.
“The overall vacancy percentage, measured as a percentage of GLA, has decreased from 6.5 per cent at 31 March 2014 to 5.4 per cent at 30 September 2014.”
The property fund also indicated that like-for-like net property revenue grew 7.9 per cent while its first half normalised distribution increased by 7.8 per cent.
“The directors of Vukile are pleased to report that the normalised distribution for the six months increased to 59.086 cents per linked unit,” [DATA VKE:Vukile] said.
“The group’s normalised net profit available for distribution amounted to 333.8 million rand for the six months, which represents a normalised increase of 20.6 per cent over the comparable period.”
Property revenue grew to 744 million rand in the 2014 interim period from 657 million rand for the same period in 2013.
However, profit before taxation decreased from 606 million rand in 2013 to 178 million rand in 2014 and earnings per linked unit decreased to 96.94 cents from 205.25 cents.
Vukile’s net asset value per linked unit increased slightly to 1 538 cents in the 2014 period from 1 535 cents in 2013.
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“Vukile remains on track to deliver full year growth in distributions of between 7.5 per cent and eight per cent. Forecast rental income has been based on contracted escalations and market-related renewals,” the company said.
“Strategically, we will continue to look selectively at acquisitions in the retail and industrial sectors that add value to the portfolio over the short and long term whilst also under-weighting the office sector.”
Vukile added that with a deteriorating macroeconomic outlook, it has decided to position the fund defensively and gearing should remain low with at least 75 per cent of interest-bearing debt being hedged.