Listed property excels amongst top ranking companies
Listed property once again delivered stand-out performance in the line-up of South Africa’s top companies.
The sector fared particularly well overall, with 18% of companies performing in the top 50 being listed property companies - based on share-price performance and income returned to shareholders.
An impressive 14 of the top 100 companies over the past five years comprise listed property companies.
Of the top 100 companies over the last 10 years, listed property companies represent some 13% of the top 70 peak performers.
“Listed property companies have performed well over the short and the long term, as evidenced in these results,” says Norbert Sasse, chairman of the Property Loan Stock Association (PLSA) and CEO of Growthpoint Properties Limited.
Achieving top-10 performance, Growthpoint, South Africa’s largest listed property company and the sector’s only ALSI-40 representative company, ranked ninth in performance of the Top-40 Index companies over five-years, delivering compound five-year growth of 18.88%. Fortress Income Fund B ranked fifth in the top 50 companies over one year, notching up compound growth of 104.85%. Premium Properties achieved ninth position in the list of Top 100 companies over 10-years, with compound growth of 37.21%.
Over the last 10 years, from October 2001 to 2011, the South African listed property sector’s market capitalisation has increased considerably from R12.8 billion to R144.1 billion. The exceptional growth of this sector is reflected in its largest counter, Growthpoint Properties, which has grown its market capitalisation 1,000 times during the last decade, surging from R30 million to R30 billion.
Listed property has also outperformed equities and bonds over the last 10 years, according to Grindrod Asset Management - notching up cumulative total returns of 24.3% per annum against equities at 17.7% and bonds at 10.3%.
According to Catalyst Fund Managers, the best performing SA asset class over the past 12 months to the end of September 2011 is listed property which has delivered total returns of 8.3% compared to SA Bonds at 5.92%, cash at 5.91% and equities SA equities at 3.6%.
“The sector’s profuse presence amongst SA’s best listed investments and its solid performance track record are grounds for any serious investor to regard meaningful exposure to listed property, as an asset class, as essential,” notes Sasse.
The Top 100 companies survey acknowledges those companies that earn the most for its shareholders in terms of share price growth. The rankings are determined as follows: the share price performance of every company listed on the JSE is measured on the basis of R10,000 invested over five years (from October 2006 to September 2011). Companies are then ranked according to their share price performance, as calculated by I-Net Bridge. The results were recently published in the Top 100 Companies survey carried out by the Business Times.
The Property Loan Stock Association (PLSA) is the representative umbrella body of the property loan stock sector comprised of voluntary members, with the weight of nearly all of the funds within the sector behind it.