The owner of Mdantsane City Mall and Cape Town’s Gugulethu Square has acquired one of Alexandra’s biggest shopping centers.
Vukile Property Fund has bought Pan Africa Shopping Centre and its future extension rights for R669 million.
The 16 000 square metre shopping centre is in the heart of Alexandra’s transport and retail hub. It opened in 2009, becoming South Africa’s mall to be first fully integrated with a taxi rank. It is occupied mainly by national tenants, including Boxer, Truworths, Pep, Ackermans, Mr Price, and Clicks.
It has been so successful that the previous owners planned to expand Pan Africa Shopping Centre by another future 9 000 square meters, taking its size to over 25 000 square meters in the next 20 months.
The acquisition agreement splits the transaction into two parts. Vukile will take ownership of the existing shopping centre for R414.6 million of the purchase price. Vukile will also appoint the sellers to develop the centre’s second phase expansion, which it will acquire for R254.3 million.
The Pan Africa Shopping Centre was one of malls that suffered extensive looting during the July 2021 riots. The shopping center’s precinct was also in the crossfire of Operation Dudula earlier this year when locals clashed with foreign nationals, forcing some shops to temporarily close in march. Several were set alight.
But brave companies are realising the growth potential in the informal and township economies.
Vukile reaped the rewards of its first mover advantage by expanding to rural areas and townships among listed mall owners during the Covid-19 pandemic.
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Vukile’s SA MD, Itumeleng Mothibeli, believes the centre is an excellent asset for the group’s portfolio, given its concentration in the high-performing township and rural shopping centres. He calls this “the sweet spot in the SA retail market”.
“As is typical of our assets, it has a high percentage of essential services tenants, which further fortifies the defensiveness of our portfolio,” said Mothibeli.
Vukile CEO Laurence Rapp said that after the Covid-19 disruptions, the group was pleased to resume its growth plans in the South African and Spain portfolios.
“By acquiring this asset and its future extension, we are deepening our core investment strategy in South Africa and adding value for our stakeholders,” he said.
