Dipula Properties delivers robust annual results and is in the market for new opportunities

Dipula Properties delivered a strong 5% increase in distributable earnings for the year to end-August and might even beat its guidance for the next financial year of 7% growth, CEO Iszak Petersen said on Wednesday.

Full-year distributable earnings per share came to 57.26 cents. Petersen noted that although there was not much acquisition activity in the diversified retail, industrial, and residential REIT this past year - Dipula focuses on township and rural areas for its retail properties in particular - “there is a bit of a pipeline of potential acquisitions; we are excited about it,” he said in a briefing.

He stated that the results reflected prudent capital allocation, “rigorous asset management, financial and operational discipline, and the reignition of acquisitive growth.”

Dipula had finalised five acquisition agreements in August 2025, totaling about R700 million. The largest of these was the R480m purchase of Protea Gardens Mall in Soweto, a 24,000 square metre community shopping centre.

Petersen said Protea Gardens was likely to be their biggest retail asset - Dipula typically targets smaller retail centres. Dipula had also secured two industrial properties with strong tenant profiles, in line with a focus on growing its mid-sized logistics and industrial asset base.

He said they were looking at opportunities in the retail space in particular. “When you are three, four, or ten times our size, you have to look carefully at what moves the needle for you. We are nimbler; there are more opportunities for our size. We have a relatively high vacancy rate in our offices, so we will need to address that too in the year ahead too.”

Petersen said the group was fortunate in that its management had a “toolbox full of tactics and asset management strategies” that could deal with the challenging macroeconomic environment, but they would certainly benefit further from tailwinds created by any improvement in the macroeconomic environment in the new financial year.

He noted that tenants in their retail portfolio had benefited in the past year from consumers having “a little bit more in their pockets” due to the reduced interest rate and the Two Pot Pension payouts.

South Africa-focused Dipula has been delivering sustainable investment returns for 20 years, with nearly 15 of those as a listed entity. It generates 67% of income from retail properties defensively positioned with retail centres in townships, rural, and urban convenience locations. It also has logistics and industrial assets (13% of income), office assets (16%), and a small non-core residential property portfolio (4%). Its portfolio is predominantly in Gauteng.

The property portfolio increased in like-for-like value by 6% to R10.8 billion in the past year, and 10% for retail, buoyed by higher income prospects and supporting a 7.5% rise in net asset value. Dipula’s revenue, excluding straight-lining, increased by 4% to R1.52bn.

Operational highlights included significant leasing activity, with retail portfolio vacancies reducing to 5%, even though total portfolio vacancies edged up slightly from 7.5% to 8.5%, mainly due to short-term dynamics in highly lettable properties in the office and industrial portfolios. In residential, vacancies fell to 6% from 12%, said Petersen.

Discussions are in advanced stages to sell its affordable residential rental units, which currently represent 4% of income. The planned disposal will see Dipula reallocate capital to the retail and industrial sectors that are core to its business.

Driving an active capital recycling strategy, Dipula disposed of R200m of non-core properties, substantially higher than R37m in the prior financial year. Proceeds contributed to repaying debt and funding asset management strategies, acquisitions, and sustainability initiatives. Some R214m was invested in refurbishments and redevelopments, a 37% increase over the prior year. A further R170m is planned for the 2026 financial year.

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