L2Ds Sandton City back to 85% of weekend shoppers – Moneyweb.co.za

L2Ds Sandton City back to 85% of weekend shoppers – Moneyweb.co.za

Liberty Two Degrees (L2D) – the joint owner of prime shopping centres such as Sandton City, Eastgate and Midlands Mall – on Monday reported a sharp uptick in weekend footcount at its centres.

In a JSE Sens trading update the group noted that the latest weekend footcount across its portfolio is now at 80% of 2019 levels. The improvement comes as South Africa eased Covid-19 restrictions to the lowest point, alert Level 1, which allows most businesses to trade.

L2D reported that the weekend footcount at its flagship and largest shopping centre, Sandton City (just over 146 000m2 of retail space) in Joburg, is at 85% of last year’s levels. Eastgate in Bedfordview (Ekurhuleni) is the top performer with its weekend footcount recovering to 97% and Midlands Mall in Pietermaritzburg at 88%.

Eastgate Shopping Centre, the super-regional mall owned jointly by Liberty Holdings and Liberty Two Degrees. Picture: L2D/ Supplied

“The monthly portfolio footcount at August 31, 2020 improved to 68% of the comparative 2019 level and continued to rise with a 10% increase from July 2020,” the group said.

Super-regional and regional shopping centres generally have higher footcounts and trading levels in weekends.

Meanwhile, L2D said that the number of tenants trading as a percentage of retail GLA (gross lettable area) as at August 31, 2020 was 93.1%, which “represented a good improvement” from the 85.4% reported at June 30, 2020.

“As noted in the interim results, the operational performance for the first six months of 2020 was significantly impacted by the Covid-19 pandemic and the implementation of a national lockdown. The move to lockdown Level 2 on August 18, 2020 and the reopening of the South African economy has contributed to a recovery in trading with a marked improvement in footcount at our centres with most tenants having reopened for trade,” it pointed out.

“The recent announcement of the move to lockdown Level 1, on September 21, 2020, which further relaxes restrictions on the movement and economic activity of South Africans is welcomed and will support the ongoing economic recovery,” L2D added.

The group noted that the ability of restaurants to operate at increased capacity and the “opening up” of international travel from October 1, 2020 will provide additional impetus to the South African economy as well as the recovery of its hospitality portfolio.

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Besides Sandton City and Nelson Mandela Square, L2D jointly owns the five-star Sandton Sun and InterContinental Johannesburg Sandton Towers hotels adjoining the shopping centre. The group is also part owner of the Garden Court Sandton City and the Sandton Convention Centre. All the hotel properties are managed by Tsogo Sun Hotels.

L2D also provided an update of its latest rent collections and negotiations, as well as its leasing activities. However, it noted that the information has not been reviewed or reported on by the group’s external auditors.

“We are pleased to report that rental collections based on the full amounts due and before any rental relief has increased to 74% at August 31, 2020. This is an improvement from the levels last reported at April (38%) and May (45%) 2020,” it said.

“The respective collections percentages for June and July 2020 were 65% and 72%. The improvement is a result of the further finalisation of rental relief negotiations and the fact that almost all tenants are now trading,” L2D added.

From a portfolio turnover front, the group has seen “a gradual improvement” as the lockdown levels have eased.

“We are pleased to note the continuing positive trend in monthly turnover and specifically the monthly portfolio turnover for July 2020 which has returned to 71% of the turnover reported on for July 2019,” L2D noted.

“Botshabelo Mall [Free State] has recorded turnover growth over the most recent three months and this strong performance is a result of the community nature of the mall and the relatively smaller impact from Covid-19 on both tenant performance and footcount,” the group said.

L2D, however, said that turnover at its super-regional shopping centres is approximately 30% below the comparative 2019 periods.

“These malls [super-regionals like Sandton City and Eastgate] have been more severely impacted as a result of the lockdowns and exposure to restaurants and hospitality, however, the recent move to lockdown level 1 should lift turnover levels further,” it pointed out.


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