Flanagan & Gerard reported that revenue growth for its shopping center portfolio increased 12% year-on-year in June 2022, despite retail sales in South Africa falling 2% in the same month .
Ballito junction in KwaZulu-Natal. Source: Supplied
The portfolio showed even greater improvements from July 2021 to July 2022, driving revenue growth of 20%. However, this includes the impact of the July 2021 unrest which hampered trade in some malls.
“Regional malls are bouncing back. Attendance is up year-over-year and surpasses pre-Covid figures for the first time, while per capita spending has increased significantly,” reports Paul Gerard, Managing Director of Flanagan & Gerard.
Flanagan & Gerard develops and invests in leading regional shopping centers and upscale niche community centers. He is co-owner of Ballito Junction Regional Mall in KwaZulu-Natal as well as Morningside Shopping Centre, Springs Mall and Vaal Mall in Gauteng, as well as Highveld Mall and Middelburg Mall in Mpumalanga, and Thavhani Mall, Musina Mall, Great North Plaza and Mall of the North in Limpopo.
The new Flanagan and Gerard shopping center, the 24,000m22 Boardwalk Mall, is scheduled to open on September 22, 2022 in Gqeberha, Eastern Cape. Boardwalk Mall is a major development by Flanagan & Gerard Group and Emfuleni Resorts, a subsidiary of Sun International.
Trends in Flanagan & Gerard’s commercial real estate portfolio paint an encouraging picture and point to a welcome return of the commercial categories and retailers hardest hit by pandemic restrictions.
“Our restaurants are trading well and ahead of pre-Covid levels. Movie theaters have rebounded and are showing a similar pattern. Liquor stores show massive growth in trade. In our portfolio, we are seeing great results from Edgars’ new leadership and Game’s new strategy. It’s especially exciting to see national retailers bringing new brands to market,” says Gerard.
Mitigate the impact of load shedding
The continuing reality of load shedding has given shopping malls with backup power a competitive edge in attracting shoppers and has reinforced the abundant opportunities for solar-powered shopping malls in South Africa. Flanagan & Gerard aims for all of its commercial properties to operate fully during power outages, for which it uses a combination of solar power and backup generation.
By improving business outcomes, promoting carbon reduction by decreasing fossil fuel consumption and easing the load on the national power grid, Flanagan & Gerard says it will continue to increase solar power generation capacity in its shopping centers to improve business results, promote the reduction of carbon emissions by decreasing fossil fuel consumption and easing the load on the national electricity grid.
Commenting on the strength of its tenants and its tenant mix, the company notes a low vacancy rate of 0.45% across its entire retail portfolio, and points to “a very low level of arrears” among tenants. shopping centers.