JSE-listed real estate investment trust (Reit) Vukile Property Fund has released a pre-close update ahead of its March 31 financial year-end, showing astute capital recycling momentum and robust operating metrics, supported by asset management initiatives and Vukile’s customer-focused retail property model.

During its second half of the financial year, Vukile continued to rotate assets in line with its strategy, recycling capital into strategically aligned, earnings-accretive assets while avoiding cash drag.

Following Vukile’s R2.65-billion capital raise in October 2025, Castellana Properties, its 99.7%-owned subsidiary, disposed of a portfolio of nine retail parks in Spain for €279-million.

In a media release, Vukile explained that proceeds were reinvested into high-quality, higher-growth Spanish shopping centres, including the Berceo shopping centre, in Logroño, for €103.6-million; the Islazul shopping centre, in Madrid, for €318-million; and, most recently, a 50% stake in the Splau shopping centre, in Barcelona, in joint venture with Unibail-Rodamco-Westfield (URW).

Splau is valued at €350-million, with Castellana’s share amounting to €175-million.

The company said these transactions aligned with Castellana’s strategy of acquiring dominant shopping centres with strong catchments, clear growth prospects and asset management upside.

“Our strategic asset rotation this period has fundamentally reshaped, strengthened and diversified the Castellana portfolio, which now ranks among the strongest in Iberia and includes leading assets in Madrid, Barcelona and Valencia,” Vukile CEO Laurence Rapp said in the March 23 media release.

Similarly in South Africa, Vukile disposed of four noncore assets for R625-million, while at the same time increasing its exposure to targeted core assets, including the acquisition of a 50% stake in Chatsworth Mall, a shopping centre in KwaZulu-Natal, for R620-million.

The company also finalised agreements to acquire 100% of Botshabelo Mall, situated in the Free State’s largest township, for R443-million.

Additionally, it also invested in increasing its solar generation capacity.

Vukile also completed the acquisition of a 35% stake in Pradera, a pan-European retail property investment fund and asset manager with €5-billion of assets under management.

The company said this transaction provided access to more than 100 retail specialists and positioned Vukile to explore expansion into additional European markets, in line with its strategy of operating with expert local management teams on the ground.

All acquisitions were funded from existing cash resources, with no requirement for additional equity capital.

Meanwhile, following the successful deployment of capital raised in October 2025, Vukile said shareholders had unanimously approved a further 9% extension to Vukile’s authority to issue shares, reflecting confidence in its disciplined capital allocation.

“Maintaining the flexibility to raise capital when stable market conditions prevail, and advantageous pricing relative to tangible, accretive opportunities are in place, is a key part of our strategy,” said Rapp in the media release.

Rapp explained during a media briefing that, given the current volatility in global markets, the company would not raise money in the current environment.

He pointed out that Vukile would continue to monitor the situation and would only raise money when required, if there were tangible, accretive opportunities in place and in a more stable, price-advantageous environment.

OPERATIONS

Vukile reported that, for the financial year under review, net operating income (NOI) for its South African portfolio increased by 10%.

Sales grew by 5.3% with almost all categories up, trading density rose by 5.1% and annualised footfall increased by 2%.

Vacancies remained low at 1.7%, while rental reversions continued their positive momentum and grew by 3.5%. The portfolio’s cost-to-income ratio improved further to 12.4%.

Vukile Property Southern Africa MD Itumeleng Mothibeli noted that annual like-for-like NOI growth for the South African portfolio was projected to increase by 10.1%, driven by sustained high occupancy, additional PV and operational costs savings.

Mothibeli added that the South African portfolio continued to show growth in both footfall and sales, driven by strong promotional activity.

He explained that township and rural centres continued to outperform with growth in both year-on-year sales (5.2% and 5.3%) and footfall (0.7 and 0.7%).

All segments showed trading density growth with 4% in township, 5% in rural, 4.1% in urban, 9.3% in commuter and 5.4% in value centres.

Meanwhile, Vukile has reported that Castellana’s Iberian portfolio has delivered excellent metrics. Footfall grew by 3.3% and sales by 4.1%, while vacancies were a mere 1%, reflecting robust tenant demand.

Rental reversions were positive, at 8.3% in Spain and 18.7% in Portugal, resulting in a blended rate of 10.3%.

Rapp described the Castellana portfolio as being in “pristine condition”.

“I’m delighted with where the Castellana portfolio is positioned all in all.”

GUIDANCE

For the full-year, Vukile confirmed that it would meet its guidance of at least 9%-a-share growth in both funds from operations and dividends, delivering this increase from an already high base.

During the presentation, Rapp noted that Vukile continued to pursue opportunities that were aligned with the company’s long-term strategic objectives and that delivered accretive returns for shareholders, reinforcing Vukile’s commitment to sustainable growth and value creation.

“We will continue to pursue opportunities that align with our long-term strategy and provide accretive returns for shareholders, reinforcing Vukile’s dedication to sustainable growth and value creation,” he noted in the release.