The SA REIT sector is set to deliver double-digit total returns to investors next year.
In a steady valuation environment in South Africa, SA REIT returns could be in double-digit territory supported by sector distribution yields of approximately 9%, despite lower distribution growth of around 4 to 5%.
Howard Penny of Capricorn Fund Managers
SA REITs are exposed to the best commercial properties in South Africa and, in some instances, offshore. Their property income is underpinned by lease agreements with tenants in these property assets. Rentals are contracted and most escalate at a predetermined rate annually -- around 6.5% to 8% in the current domestic market.
Andrea Taverna-Turisan, SA REIT Marketing Committee Chairman.