Safari on track to reach goal for growth

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Safari Investments, which focuses on township shopping malls, is on course to grow to a R3bn fund in 18-24 months.

Releasing results for the six months to September yesterday, Safari reported it had grown its portfolio from R1.3bn at listing in April last year to R1.9bn at the end of September this year.

“We are on track to meet our growth expectations. I believe we can build our portfolio to R3bn in the latter part of 2017 and then R4bn by 2019,” CEO Francois Marais said.

While there were fewer opportunities to develop new malls in middle to upper-income areas, there was demand for retail centres in townships.

Property funds are building shopping centres to cater for previously undersupplied areas. They have attracted customers away from some of the smaller street shops to larger malls.

Mr Marais said Safari was “very happy” with its portfolio, comprising 18 properties.

“Five of the properties are established retail centres, of which three are serving as regionals in their areas. We believe we can grow this to 23 in the next financial year. Our growth is attracting new pension fund investors too,” he said.

Safari, which has a market capitalisation of about R1.5bn, is a relatively illiquid stock with a small number of shareholders.

“It is too tightly held even to begin to justify holding it. There are some very attractive assets in here, but the shareholder spread is too small,” said Jay Padayatchi, executive director at Meago Asset Managers.

“At this stage, we are excited about growing our shareholder base. We believe we are a property company which is growing carefully but providing consistent distribution growth along the way,” said Mr Marais.

Safari has also branched off into other investments, acquiring a healthcare property in the period under review.


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