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South Africa has the 6th most shopping centre space in the world!
It& #39;s also ranks among the highest levels of shopping centre supply relative to household consumption expenditure.
Overlay being "the most unequal" country in the world & you have a perfect recipe for disaster!
It& #39;s also ranks among the highest levels of shopping centre supply relative to household consumption expenditure.
Overlay being "the most unequal" country in the world & you have a perfect recipe for disaster!
Red Flag #1:
"Build it & they will come" no longer works.
SA commercial property is under severe pressure. Rental reversions are negative & vacancies are increasing.
Retailers aren& #39;t able to survive higher costs (electricity, property rates, etc). https://www.businessinsider.co.za/redefine-rentals-2019-5">https://www.businessinsider.co.za/redefine-...
"Build it & they will come" no longer works.
SA commercial property is under severe pressure. Rental reversions are negative & vacancies are increasing.
Retailers aren& #39;t able to survive higher costs (electricity, property rates, etc). https://www.businessinsider.co.za/redefine-rentals-2019-5">https://www.businessinsider.co.za/redefine-...
Red Flag #2:
Average SA consumer is R70k in debt.
Besides being heavily indebted, people have limited savings & are suffocating to survive even basic costs of living (fuel, rent, transport.. endless list).
Debt used to fund consumption expenditure makes it a vicious cycle.
Average SA consumer is R70k in debt.
Besides being heavily indebted, people have limited savings & are suffocating to survive even basic costs of living (fuel, rent, transport.. endless list).
Debt used to fund consumption expenditure makes it a vicious cycle.
Red Flag #3:
A cross-section of SA listed retailers are putting out scary earnings numbers.
Shoprite? Full year net profit down 18%
Mr. Price? Shares slipped 14% after stating the consumer "remains constrained"
Massmart? Losses expected to be close to R400m (R95m last year)
A cross-section of SA listed retailers are putting out scary earnings numbers.
Shoprite? Full year net profit down 18%
Mr. Price? Shares slipped 14% after stating the consumer "remains constrained"
Massmart? Losses expected to be close to R400m (R95m last year)
Useful Links:
https://sacsc.co.za/news/sa-has-more-than-23-million-square-metres-of-retail-space
https://sacsc.co.za/news/sa-h... href=" http://www.sacommercialpropnews.co.za/
https://www.sacommercialpropnews.co.za/">... href=" https://m.news24.com/SouthAfrica/News/sa-plagued-by-personal-debt-20190506-2
https://m.news24.com/SouthAfri... href=" https://www.google.com/amp/s/amp.cnn.com/cnn/2019/05/07/africa/south-africa-elections-inequality-intl/index.html
https://www.google.com/amp/s/amp... href=" https://www.iol.co.za/business-report/companies/massmart-profit-severely-hit-by-weak-sales-losses-30108211">https://www.iol.co.za/business-...
https://sacsc.co.za/news/sa-has-more-than-23-million-square-metres-of-retail-space
In a global context - digital retail and online shopping has been cannibalising bricks & mortar retail.
Cheaper data, greater internet access & better online product offerings are catalysts.
There& #39;s also a reluctance in SA by some people to shop online due to security fears.
Cheaper data, greater internet access & better online product offerings are catalysts.
There& #39;s also a reluctance in SA by some people to shop online due to security fears.
