Market Review The SA Listed Property Index (SAPY) realised a return of -4.4% during the third quarter of 2019. This was against the positive return it managed over the first half of 2019. This three-month performance was in line with that of the FTSE/JSE All Share Index’s -4.6%. Bonds (0.8%) and cash (1.8%) were the only asset classes showing positive returns. On a year-to-date basis, SA bonds were the outperformers with returns of 8.44%, followed by SA equities (7.08%), SA cash (5.45%) and SA property (1.34%). The SA Listed Property (SAPY) and the All Property (ALPI) Indices continue to underperform other asset classes over a rolling 12-month period.

The best performing shares in the SAPY for the last quarter included Sirius (19%), Resilient (9%), Investec Australia (8%) and Liberty 2 Degrees (3%). By contrast, the worst performers were Hospitality B (-16%), Fortress B (-15%), Redefine (-13%) and Mas Plc (-13%)

A key theme prevalent in the retail sector both locally and offshore is the need to consistently invest in your retail assets in order to attract the best tenants with their flagship offering, especially in an environment of oversupply and high mobility of consumers who are spoilt for choice.

The All Property index has underperformed the SA Listed Property index this year due to its larger exposure to the UK and its concomitant Brexit risk, together with its exposure to smaller SA property companies.