September 23, 2016

Sanlam Africa Core Real Estate Investments Reports Lower Profit for June 2016

Dolapo Omidire

For the 6 months ended June 2016, Sanlam Africa Core Real Estate Investments Ltd reported a profit before tax of $1.1 million, lower than the $1.5 million for the same period a year ago. The fund explained that the regions where they are holding assets continue to suffer an economic slowdown.  The sustained slump in commodity markets, falling growth expectations and concerning sovereign debt burdens have also contributed to weaker local trading conditions.

Atlantic House (formerly Maersk House) in Victoria Island, Lagos – Nigeria, continues to experience high vacancy rates as demand falls and supply rises in Lagos. These market conditions have also resulted in a decrease in the asking rentals to $780/sqm/month in Q2:2016 (down from ~$900 levels) according to Broll Nigeria, however achievable rents are often 15% lower. The independent valuation for the property as at 31 December 2015 fell by 21% in dollar terms. Atlantic House still has tenants like International Finance Corporation and Cisco.

Atlantic House, Victoria Island, Lagos - Nigeria. Image Source:
Atlantic House, Victoria Island, Lagos – Nigeria. Image Source:

In Ghana, Accra Mall’s trading conditions have remained largely resilient, with only a marginal impact on operations from the current economic downturn according to Sanlam. Capital Properties, their asset in Dar es Salaam, Tanzania currently has a temporarily increased vacancy rate, mainly due to the refurbishment of one of its office towers.

Moving forward, Sanlam Africa core Real Estate Investments is expected to continue to pursue its strategy of growing its portfolio of assets, and is said to be currently evaluating acquisition and expansion opportunities. They intend to raise further capital in order to fund the future asset acquisitions and expansions.

Sanlam Africa Core Real Estate Investments Ltd is a fund registered in Mauritius and listed on the Stock Exchange of Mauritius, with core real estate assets in Ghana, Tanzania and Nigeria.

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