The South African Real Estate Investment Trust (SA REIT) Association has appointed Vukile Property Fund CEO Laurence Rapp as chairperson.

Rapp, who had previously been the chairperson of the association’s marketing committee, was succeeding the association’s founding chairperson, Growthpoint Properties CEO Norbert Sasse.

“South African REITs represent an internationally-recognised, best-of-breed investment structure. Now that we have this foundation in place, the sector’s next challenge is to grow,” Rapp said, adding that the association would continue to build on its positive partnerships to ensure it remained at the forefront of good governance, innovation and international best practice.

He noted that the flow of money into the sector drove down the cost of capital and created new opportunities and that, to help attract funds to the sector, he would like to see South African REITs gain greater coverage and inclusion in various property-related indices.

“Notwithstanding the sector’s massive growth, it still only makes up 2.5% of the JSE. Yet, most asset consultants would recommend a weighting of 10% or more in a balanced portfolio. That means REITs are underrepresented on the JSE in terms of the sector’s weighting of marketing. Sector growth would help correct this, supported by an increased flow of funds,” Rapp stated.

Meanwhile, Fortress Income Fund CEO Mark Stevens had been appointed to succeed Rapp as chairperson of the SA REIT association marketing committee.

Stevens said this committee was growing its engagement with shareholders and potential investors, from the retail investor to large pension fund managers.

“We want to make sure that South African REITs get the recognition they deserve worldwide. Our challenge is to show the true nature of listed property as an investment, not only the regular income pay-outs, but also the long-term benefits of capital appreciation.

“Behind each REIT is its physical property investments, but also much more. REITs are quality companies with clearly defined investment strategies, good governance, entrepreneurial flair and innovative, expert management teams,” he explained.