Putprop agrees to sell Gauteng properties for $10.3 million in portfolio shift

Putprop Ltd., a South African property investment company, has agreed to sell two Gauteng assets for a combined R168 million ($10.3 million), marking another step in its effort to recycle capital from non-core holdings into income-producing properties. The planned disposals, disclosed in a trading update ahead of the company’s next financial results, involve the sale of Putprop’s 50 percent interest in the Mamelodi Square retail enterprise for R148 million ($9.1 million) and the Dobsonville property for R20 million ($1.2 million).

Both assets will be acquired by JSE-listed real estate investment trust Exemplar REITail Limited. The larger of the two transactions centers on Mamelodi Square, a community shopping center in Gauteng with a total rentable area of 16,955 square meters. At the time the agreement was signed, the property was generating a weighted average rental of R145.52 ($8.95) per square meter. The deal includes Putprop’s 50 percent stake in the retail enterprise as well as its undivided ownership interest in the underlying property.

Disposal reflects portfolio rebalancing strategy

The agreed sale price highlights the value that Putprop has been able to realize from the asset. Exemplar will acquire the stake as a going concern for R148 million, well above the enterprise’s net asset value of R76.72 million ($4.72 million) reported in Putprop’s interim results for the six months ended Dec. 31, 2025. The shopping center has also contributed to earnings. For the year ended June 30, 2025, the enterprise generated profit after tax of R19.42 million ($1.2 million). Profit after tax for the six months through December 2025 totaled R2.95 million ($182,000), reflecting a softer performance during the first half of the current financial year.

Alongside the Mamelodi Square deal, Putprop will dispose of the Dobsonville property, an industrial-zoned asset with a rentable area of 3,500 square meters. The property is being sold for R20 million ($1.2 million), compared with a carrying value of R18.5 million ($1.13 million) in both the company’s financial statements for the year ended June 2025 and its interim accounts as of Dec. 31, 2025. The asset has remained profitable despite its size. Profit after tax attributable to the property amounted to R3.95 million ($243,200) during the year ended June 2025 and R1.25 million ($77,000) during the first six months of the current financial year.

Sales exceed independent valuations

Taken together, the transactions suggest Putprop has secured favorable pricing for both assets. The combined disposal value exceeds the latest independent valuations, which placed Mamelodi Square at R139 million ($8.55 million) and the Dobsonville property at R18.5 million as of June 30, 2025. The sales therefore represent premiums to their most recently assessed market values. The proceeds are expected to strengthen Putprop’s balance sheet while providing additional capital for future acquisitions. The company said funds from the disposals will be used to reduce debt and support investment in income-producing properties, consistent with its strategy of generating stable rental income from a focused portfolio.

The two transactions are linked and will proceed only if both sales are completed. They remain subject to several conditions, including board approvals, tenant consents where applicable and shareholder approval. Because the disposals qualify as a Category 1 transaction under JSE listing requirements, shareholders will be required to approve the deals at a general meeting before they can be implemented. Putprop said a circular containing full details of the transactions and notice of the meeting will be distributed in due course.

Asset sales support portfolio optimization

The disposals come as Putprop continues to reshape its property portfolio under the leadership of Darryl Mayers. The company owns and manages 13 properties across three South African provinces, with exposure to the retail, commercial, residential and industrial sectors. Its portfolio serves 131 tenants, spans 88,042 square meters of gross leasable area and has an investment property value of approximately R1.1 billion ($68 million). 

The latest transactions follow another portfolio adjustment announced earlier this month. Putprop agreed to sell an industrial property in Pretoria for R29 million ($1.6 million) to Bluhire Proprietary Limited, a company wholly owned by businessman Hermanus Gerhardus Brink. The asset, located in Montana Park, underscores the same approach now evident in the Mamelodi Square and Dobsonville deals. By disposing of selected non-core assets and reallocating capital toward properties with stronger income potential, Putprop is aiming to enhance portfolio quality, reduce debt and build capacity for future investment opportunities.