Vukile Property Fund, the specialist retail real estate investment trust (REIT), said it is on track to meet its guidance of 2% to 4% growth in funds from operations (FFO) per share and 6% growth in dividends per share (DPS) for the financial year ended 31 March 2025.
The REIT also provided preliminary guidance on FFO and dividend per share growth for FY26 of at least 6%, based on conservative assumptions and without anticipating any need for new equity capital.
The ‘transformative’ year has been underpinned by strategic execution, it said. Driven by disciplined dealmaking and decisive capital deployment, Vukile’s gross asset value now exceeds R50 billion.
Through its 99.5%-held Spanish subsidiary Castellana Properties, Vukile said t grew its asset base in Spain and Portugal by nearly 60%. It exited its investment in Lar España at an impressive profit of EUR82 million, swiftly redeploying capital to acquire the iconic Bonaire Shopping Centre in Spain’s Valencia province at a compelling cash-on-cash return of over 8%, avoiding cash drag and securing sustainable earnings from a top-quality asset.
Adding a new engine of growth to its strategy, Vukile entered Portugal with four retail acquisitions. A fifth deal is well advanced and already fully funded, the property group said in its pre-close update.
It said that the Iberian portfolio grew around 60% over the 12 months, cementing Vukile’s dominant position across two of Europe’s strongest economies − Spain and Portugal. Approximately two-thirds of Vukile’s assets and 60% of earnings are now offshore.
In South Africa, Vukile acquired a 50% stake in Mall of Mthatha (formerly BT Ngebs) in May 2024, where early turnaround performance has exceeded expectations. The mall’s vacancy rate has decreased dramatically from 18% to just 1.8%.
These assets were acquired at a favourable point in the cycle, expanding Vukile’s footprint and growing its Iberian portfolio with strategically aligned, high-performing assets that are delivering strong cash flows with further upside through targeted asset management, it said.
“We’ve come through a phase of explosive growth. Now, we’re focused on integration, optimisation and crystallising value from these assets. Vukile remains open to opportunities but will prioritise deepening value within its current footprint, and for the time being we don’t expect to raise capital,” said Laurence Rapp, CEO of Vukile Property Fund.
In South Africa, like-for-like net property income (NPI) grew 6.4%, vacancies remain below 2%, and 84% of rental reversions were positive or flat. The portfolio has recorded growth in both sales and footfall. The cost-to-income ratio reduced to 15%, with ongoing progress in solar and water initiatives enhancing sustainability metrics and efficiencies.
The group said its portfolio has seen an improvement in trade, particularly in the township (+7.8%) and rural (+4.4%) segments with overall trading density growth of 4.8% (FY24 +2.4%). Assets include Mall of Mthatha, Dobsonville Mall, and Daveyton Mall.
Continued progress on strategic leasing initiatives has kept retail vacancies stable at 1.9%, with vacancies excluding retail offices holding at 1.2%.
“We are greatly encouraged by the improved consumer environment with growth in household consumption, national retail sales, household credit extension and the SA consumer index in the past quarter,” the group said.
Vukile Property Fund will report results for the full year to 31 March 2025 on 17 June 2025.
