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After ugly year, EPP is the top performing listed property stock in 2018


While most property stocks suffered, EPP’s continued turnaround, under the leadership of CEO Hadley Dean, delivered the best performance among listed property companies on the JSE in 2018.

The FTSE-JSE SA Listed Property index, meanwhile, is up 4.33% on a capital basis this year. It lost 31.87% not including dividends last year and 25.26% with them included. This was its worst performance in more than 20 years.

Many investors had lost interest in listed property after a massive sell-off in shopping centre owner Resilient and its associated companies in January 2018, which resulted in about R120bn being wiped off their market value. The sell-off was sparked by allegations of market manipulation and insider trading around the companies.

As a result, Resilient, Fortress, Greenbay and Nepi Rockcastle, which had accounted for about 40% of the listed property sector, saw their share prices collapse in the first quarter of 2018.

JSE-traded EPP, the Polish real-estate group in which SA-based Redefine Properties owns a 40% stake, has cemented itself as one of the standout property investments on the JSE, according to Anchor Stockbrokers.

The company delivered a total return of 21% in 2018 to significantly outperform the market.

EPP CEO, Hadley Dean, says this is an affirmation of the company’s strategy. “Our focus on retail, specifically in the Polish market has given us clear advantages over some of our competitors who are more exposed to markets that are not as strong as Poland,” Dean said.

The company, which first listed in August of 2016, announced its strategy to focus specifically on retail properties. It has more than doubled its portfolio, adding more than 240,000 sqm gross lettable area (GLA) to its total portfolio in 2018 and increased the total portfolio value to over EUR 2bn.

This year the company will be completing the acquisition of six new properties. “We look forward to the addition of another 184,000 sqm of quality retail GLA,” said Dean, “This year will represent another key step in our mission to become the dominant owner of retail property across Poland.”

The company is also looking forward to the opening of Galeria Mlociny in the second quarter of this year “This is our flagship property in Warsaw and it will be the crown jewel in our portfolio” said Dean.