Community Property Company is expanding its footprint in South Africa’s underserved retail market with the planned acquisition of Umphakathi Mall in Randfontein, adding a 14,000-square-metre shopping centre to a portfolio already worth billions of rand.

The Competition Commission has recommended that the transaction be approved without conditions, saying the deal is unlikely to substantially lessen or prevent competition in any market and does not raise significant public-interest concerns.

The acquisition will see CPC buy Umphakathi Mall from Ragnarak Trading as the property investor continues to build its presence in township and rural retail markets across South Africa.

CPC builds R9.3 billion($568.9 million) portfolio

CPC is the corporate entity and holding structure behind the Futuregrowth Community Property Fund, which manages R9.3 billion($568.9 million) in properties focused on developmental investments.

The company currently owns 25 properties across eight provinces, with its shopping centres positioned in township and rural communities.

Its investment strategy centres on acquiring new and existing retail properties serving areas that have traditionally been underserved by larger shopping-centre developments.

Umphakathi Mall fits directly into that strategy. The community shopping centre is located off Main Reef Road, or R28, between Mohlakeng and Toekomsrus in Rand West City, Gauteng.

The mall serves a local population of about 129,000 people across 38,000 households, giving CPC exposure to a sizable catchment area anchored by two neighbouring townships.

Mall opened during retail shift

Umphakathi Mall opened in April 2021 following a three-year development launched by the Ancora Group in 2018.

The project faced construction and development challenges, including disruption caused by the COVID-19 pandemic, but eventually opened at full tenant capacity.

Its launch came as South Africa’s retail market was undergoing a structural shift, with consumers increasingly favouring smaller community shopping centres over large regional malls.

That trend has also helped drive greater investor interest in rural and township retail, with real estate investment trusts and other property investors increasing their exposure to the segment since the pandemic.

For CPC, the Umphakathi acquisition adds another established community retail asset to a national portfolio built around properties serving township and rural consumers.

The Competition Commission’s recommendation now clears a key regulatory hurdle for the transaction, subject to the approval process being completed.