Protea Gardens Mall spans 24,000 square metres in Soweto, anchored by Shoprite, Boxer, and Cashbuild.
Over 70% of its tenants are national retailers, ensuring stable, predictable cash flows and minimal vacancy risk.
Convenience-led township malls like this perform well during economic slowdowns, making the asset defensive and reliable.
Acquisition valuation and pricing analysis
Dipula purchased the mall for R478.1 million ($29.97 million), below the replacement cost of R19,900 ($$1247.4) per square meter. Comparable secondary urban malls often trade above R22,000 ($1379.02 per square meter. The disciplined pricing reflects Dipula’s strategic focus on yield rather than aggressive expansion, offering strong embedded growth potential.
Rental growth and portfolio strategy
Post-acquisition, Dipula plans rental reversion, turnover-linked leases, and CPI escalations. Legacy leases with conservative escalations can now be optimised through in-house asset management. The mall’s predictable income strengthens the REIT’s overall portfolio, reinforcing long-term yield and investor confidence.
Defensive retail assets performance insights
Non-discretionary retail and dense catchment township malls outperform during interest rate hikes and economic volatility. Protea Gardens’ location and tenant mix enhance Dipula’s portfolio defensiveness, ensuring predictable cash flows even in uncertain markets. This acquisition prioritises steady income over headline-grabbing expansion.
Conclusion
Protea Gardens Mall demonstrates Dipula’s disciplined investment approach. Below-replacement cost acquisition, strong anchor tenants, and defensive retail positioning make this Soweto asset a long-term growth engine for the REIT.
