Who is Safari

SAFARI Investments RSA Limited (Safari) is a property investment company listed on the JSE as a Real Estate Investment Trust (REIT), specializing in quality investments. Built on a well-established business model with a history of success, the company has established a sought-after property portfolio over many years.

Considering the unique portfolio of its assets, SAFARI is positioned to enjoy long-term sustainable growth in rental income. The company strives to astutely manage risks and challenges in the current economic climate and will not deviate from its long-term view on investment. SAFARI and its directors place strong emphasis on good corporate governance and strictly adhere to the requirements for South African REITs.

The main focus area of acquisition and investment is high income generating property assets in strategic locations. This includes selective investments in vacant land with development potential, as well as making good use of opportunities to continuously grow and unlock the value of existing assets in high-growth areas. The company is the ideal platform for the investor with a long-term investment view to acquire a share in quality assets via the unique structure of a REIT asset class.

A healthy debt:equity ratio is a core part of SAFARI’s business model. Maintaining a low gearing level is a key priority to ensure that the company remains attractive to prospective investors and funding institutions. The company is dedicated to its legacy of delivering sustainable income and capital growth.

Portfolio Summary

  • Atlyn-Atteridgeville (Cnr Phudufufu and Khoza Street)
  • Mnandi-Atteridgeville (Maunde Street)
  • Denlyn-Mamelodi (Cnr Stormvoël and Maphalla Road)
  • Thabong -Sebokeng (Moshoeshoe Street)
  • The Victorian -Heidelberg (cnr Voortrekker and Jordaan Street)
  • Platz am Meer -Swakopmund, Namibia (cnr Albatros and Tsavorite Street)
  • Soweto Day Hospital -Soweto (R558, Protea Glen)
  • NkomoVillage -Atteridgeville (49 Tlou Street)
  • Lynnwood Offices -Pretoria (Cnr Lynnwood and Rodericks Street)
Portfolio Summary

How We Add Value

As an income-focused REIT, Safari creates value for investors and other stakeholders by investing in quality assets, benefiting from active asset management based on ethical leadership and sound corporate governance principles. This results in sustainable investments generating long-term capital and income growth.

Safari’s pursuit of sustainable value creation incorporates economic prosperity, social responsibility and environmental protection.


PROPERTY DEVELOPMENT AND PROCUREMENT AGREEMENT

Safari Developments Pretoria Proprietary Limited and Safari Developments Swakopmund Proprietary Limited (“Safari Developments”) are private companies which conduct the business of identifying possible commercial property for development opportunities; assessing the feasibility of such projects; procuring, if necessary, all the requirements for a successful development; and acting as project managers to complete the construction. Safari Developments has developed commercial properties, creating opportunities for smaller investors to benefit from the growth and income of rentals which provide better for capital growth than inflation and at low risk...


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How we add value

Why We Do It

INVESTING IN COMMUNITIES: A REVOLUTIONARY START

As recently as 2004, Soweto, for example, contained an estimated 43% of Johannesburg’s population but only some 3% of the city’s retail floor spaces. Safari was one of the first organisations to invest in a major shopping centre located in an underdeveloped urban living area. We had a revolutionary vision and we were ready for our first investment in Mamelodi, Pretoria. At the time, considering the needs of the community was key, and this has remained a focal point for Safari in all our subsequent developments and investments. Strong relations with our communities are still ingrained in how Safari operates – we are deeply committed to understanding and having personal knowledge of the communities in the vicinity of our assets.

Today Safari has a strong geographic concentration in the emerging sector, in areas that were previously undeveloped and disadvantaged. Safari played a groundbreaking role in promoting quality assets that uplifted and benefited these communities, and continues to do so, by establishing desirable high-end shopping and services. Each business node that we created significantly reduces commuting time and cost associated with travelling to regional centres. This approach also alleviates the problem of unemployment and limited tradability of properties, resulting in significantly improved property values and opportunities for the communities in which assets are located. These locations have also been proved to offer attractive long-term rental and capital growth.

While boldly developing regional retail nodes in these areas, our awareness of the broad range of opportunities contributing to a thriving community grew. The initial development stage brings investment in local skills development via the developer. At commencement of trade many job and business opportunities come into being, together with the community’s sense of pride in their new and modern business node. During the operational phase people continue to enjoy access to first-class shopping and services close to their homes. Finishes and aesthetics of Safari buildings are of the highest quality and national retailers trade extremely well in our centres. Trading densities continue to achieve or even surpass the national average figures every year. A growing consumer middle class, assisted by rapid urbanisation and shifting demographic trends, is actively driving property demand and growth opportunities in these areas.


As recently as 2004, Soweto, for example, contained an estimated 43% of Johannesburg’s population but only some 3% of the city’s retail floor spaces. Safari was one of the first organisations to invest in a major shopping centre located in an underdeveloped urban living area. We had a revolutionary vision and we were ready for our first investment in Mamelodi, Pretoria. At the time, considering the needs of the community was key, and this has remained a focal point for Safari in all our subsequent developments and investments. Strong relations with our communities are still ingrained in how Safari operates – we are deeply committed to understanding and having personal knowledge of the communities in the vicinity of our assets.

Today Safari has a strong geographic concentration in the emerging sector, in areas that were previously undeveloped and disadvantaged. Safari played a groundbreaking role in promoting quality assets that uplifted and benefited these communities, and continues to do so, by establishing desirable high-end shopping and services. Each business node that we created significantly reduces commuting time and cost associated with travelling to regional centres. This approach also alleviates the problem of unemployment and limited tradability of properties, resulting in significantly improved property values and opportunities for the communities in which assets are located. These locations have also been proved to offer attractive long-term rental and capital growth.

While boldly developing regional retail nodes in these areas, our awareness of the broad range of opportunities contributing to a thriving community grew. The initial development stage brings investment in local skills development via the developer. At commencement of trade many job and business opportunities come into being, together with the community’s sense of pride in their new and modern business node. During the operational phase people continue to enjoy access to first-class shopping and services close to their homes. Finishes and aesthetics of Safari buildings are of the highest quality and national retailers trade extremely well in our centres. Trading densities continue to achieve or even surpass the national average figures every year. A growing consumer middle class, assisted by rapid urbanisation and shifting demographic trends, is actively driving property demand and growth opportunities in these areas.

With the recent addition to our portfolio of a day-hospital in Soweto, completed in partnership with Advanced Health Limited (“Advanced Health”), we realised the opportunity to deliver even more holistic assets that combine various service offerings to serve our communities better and ultimately create value for all our stakeholders.

In general South Africa has a highly inefficient, inequitable and unsustainable spatial form. In most areas the urban complex is distributed over a large area, and residents have to travel long distances to access jobs, services and facilities.

The spatial restructuring of nodes under development is therefore of vital importance to us. It comprises the correction of overall ineffective spatial patterns so that the city and its people can function optimally and communities are served more efficiently. With this aspect in mind Safari strives towards an integrated planning approach – meaning we look at our investment opportunities in a broader context as opposed to studying site potential in isolation.

Based on this integrated approach, Safari aims to strengthen its existing retail nodes in their various locations by “re-developing” them into more holistic hubs, extending beyond retail products. We are in a position to provide other essential services to the community that also make business sense. Key to this aspect is the utilisation of available or state-owned land in the vicinity of our centres. Safari is aware that these pockets of land have the potential to be upgraded into much-needed facilities.

We are in the process of identifying the demand for schools, crèches, clinics, small-scale governmental service offices, computer services and libraries in the immediate vicinity of our developed sites. We recognise a significant opportunity to partner with local municipalities to maximise returns, both economic and social.

South Africa is in the midst of a rapid population growth and urbanisation phase, with a growing middle class stimulating demand for retail space. With almost 2 000 shopping centres, spanning more than 23 million square metres of retail space, global peer comparisons suggest that South Africa has more retail space than demand dictates; but data proves that those shopping centres offering a broader mix (including national and international retailers, entertainment and catering/leisure) are attracting a growing number of shoppers. Township and rural centres have increased to almost 300, while the number of centres larger than 30 000 square metres increased from 36 in 1994 to 160 in 2014.

Despite a challenging macro-economic backdrop, political uncertainty, currency volatility and changing interest rates, Safari reported a significant growth on property income and asset value for the financial year ended 31 March 2017.

South Africa’s economic growth slowed further in 2017. From 2,2% in 2015 to 1,3% in 2016, the South African Reserve Bank projects GDP growth in 2017 to be 0%. Consumers are under pressure due to rising interest rates and inflation, as well as high levels of unemployment and indebtedness, translating into slowing retail sales growth.

In the challenging current economic climate, Safari is committed to strengthening its assets to their full potential and ensuring that nodes maintain their local dominance. This will restrain competitive schemes while at the same time bringing much-needed products and services directly to the people.

In order to optimise our investments, an understanding of the market’s immediate needs and demands is essential. Safari regularly conducts targeted research in the consumer markets located close to our centres. The survey endings are used as a guide in planning and managing operations with the aim of ensuring that the actual and diverse shopping and entertainment needs of the community are factored into upgrades and expansions in and around the facility. Through research we will continue to carefully determine how to integrate the market’s needs into our centre upgrades and the development of nearby land pockets.
At Safari, our aim is to source only the most favourable investment opportunities. REITs in general are under pressure to produce short-term dividend growth although property is a long-term asset class. In order to better balance these short-term needs with long-term sustainability, many SA REITs have increased their exposure to international assets, with some 48% of the domestic REIT sector’s total assets now based offshore due to limited domestic opportunities and relatively low European funding rates.

Safari sees substantial opportunities for investment in South Africa, but is also looking beyond our borders to consider prime opportunities that may emerge in Africa and Europe. The company’s first international investment in Namibia – a new lifestyle waterfront development on the shoreline of Swakopmund – opened in September 2016.