Fairvest’s Southview Centre in Soshanguwe. The group is steadily transforming its diversified commercial property portfolio to one that focuses on rural and non-metropolitan retail properties that serve previously underserved markets and are close to commuter nodes and transport interchanges. .
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Fairvest has uprated its distributable earnings guidance after delivering sector-beating financial metrics in the six months to March 31 on Wednesday as it continued to build out its retail property portfolio.
The interim distribution per A share increased to 71,82 cents from 69,66 cents at the same time a year ago, while the distribution per B share was up 12.3% to 25,94 cents, with the growth rate per B share significantly outpacing the Consumer Price Index. The 100% payout ratio was maintained.
Fairvest owns and manages 130 retail, office, and industrial properties, valued at R135 billion, and its focus is on rural and non-metropolitan retail properties that serve previously underserved markets and are close to commuter nodes and transport interchanges.
CEO Darren Wilder said their distributable earnings guidance for its B shares was expected to be between 53,4 cents and 54,4 cents for the 2026 year, an increase of between 11% and 13%. At the last financial year-end, the group had guided for an increase of between 9% and 11%.
He said the strong interim performance was mainly the result of discipline in their team in executing their strategy.
As at March 31, Fairvest also held a 23.6% interest in Dipula Properties and a 55.3% interest (September 2025: 79.9% in Onepath Investments (RF). Onepath owns fibre infrastructure in townships, which is rented to a fibre network operator to provide high-quality internet access to township homes and communities.
“Fairvest is making consistent progress in repositioning toward a retail-focused portfolio through the disposal of non-core assets and selective, accretive acquisitions, enhancing long-term earnings visibility and sustainability,” Wilder said in an interview with Business Report.
“More than 70% of revenue is already generated from retail properties.”
He said their vacancies were low at 5.1%, tenant quality and rental reversions had improved, and the portfolio remains operationally robust.
Like-for-like net property income increased by 8%. Letting activity was positive, with 240 new deals and 210 renewals concluded. The weighted-average lease escalation remained stable at 6.7%, with a weighted-average lease expiry of 29,4 months.
Strict control over expenses saw these rise 6.3%, largely driven by additional properties acquired.
Fairvest disposed of one commercial property valued at R65 million in Goodwood, Western Cape. The acquisition of two malls owned by the Muller Group, Jozini Mall and Tugela Ferry Mall, in KwaZulu-Natal, for R700.4m, was still underway.
These transactions were in line with Fairvest’s medium-term strategy to dispose of non-core assets and recycle the proceeds into rural and non-metropolitan retail properties. The group has a strong pipeline of potential property acquisitions, said Wilder.
Total capital expenditure of R126.9m was incurred, of which R18.4m relates to further investments in solar initiatives.
As of March 31, outstanding loans amounted to R4.,3bn from R3.9bn at the end of September 2025.
After accounting for cash and its equivalents, the loan-to-value ratio was 26.6% versus 25.6% at the end of September 2025. The group held R926.7m in cash on hand and undrawn debt facilities available for growth initiatives.
Post the interim period, Fairvest raised R900m through a book build, which will be utilised to partially settle the purchase consideration for the Muller Group acquisition, to fund ongoing investment in Onepath Investments, and to reduce debt in anticipation of pending asset transfers.
Onepath's towship fibre infrastructure is leased to a fibre network operator that provides high-quality internet access to township homes and communities.
The rental income generated from this arrangement offers an accretive dividend yield for Fairvest and it also grants Fairvest access to information and insights that benefit its current retail portfolio and potential new opportunities.
“While the macroeconomic environment has become more uncertain, solid property fundamentals, combined with conservative balance sheet management, position the group for continued growth,” said Wilder.
BUSINESS REPORT