R100 million shopping malls sold in South Africa

The Competition Commission has recommended that the Competition Tribunal approve the sale of two shopping centres in KwaZulu-Natal worth R106 million.

The commission approved the acquisition of the Nquthu Shopping Centre and Ezulwini Royal Shopping Centre in rural KZN, by JSE-listed REIT, Fairvest.

Combined, the centres carry a value of R106 million and make up two of the five retail centres Fairvest is acquiring for around R480 million.

The commission said the acquisition is unlikely to trigger any competition or public interest concerns.

Fairvest already holds interests in several entities in the property sector, with most of its portfolio sourced in KZN.

It owns standalone retail properties in the central business district (CBD), retail local convenience centres, retail neighbourhood centres and retail community centres.

The malls are being acquired from Imbali Props 21 Proprietary Limited, a subsidiary of the Collins Property Group—a commercial property development and investment group involved in new developments and the refurbishment of existing properties.

The Collins Property Group currently has over 120 properties throughout Southern Africa and Europe and is actively working on restructuring its portfolio.

Colkru Investments, a 90% owned subsidiary of Collins, has also signed an agreement to sell its Eyethu Junction Shopping Centre to Fairvest for R103 million.

The Ezulwini Royal Shopping Centre is classified as a local convenience centre, located in Ulundi in KwaZulu-Natal. It has a gross lettable area of around 4,500 square metres and is valued at R39 million.

The Nquthu Shopping Centre is also classified as a local convenience centre, located in Nquthu in KwaZulu-Natal. It has a gross lettable area of around 4,500 square metres and is valued at R67 million.

In its latest results, Fairvest said that the acquisitions align with the group’s strategic objectives of investing in retail assets servicing the previously disadvantaged communities.

It has been specifically targeting acquisitions that are located close to community centres and transport networks and are accretive to earnings.

Nquthu Shopping Centre – R67 million

Ezulwini Royal Shopping Centre – R39 million