Equites Property Fund is accelerating its UK exit and betting on South African retailers upgrading supply chains and logistics infrastructure.
The specialist logistics real estate investment trust (REIT) reported distribution per share growth of 5.3% to 141.01 cents for the year ended February, while net asset value per share rose 1.2% to R16.69.
It completed more than R1bn in disposals, raised R700m in equity, and reduced its loan-to-value ratio to 35.1%. It also ended the year with R3.1bn in liquidity, comprising cash and undrawn facilities, supporting its development pipeline and near-term funding flexibility.
“We’re pleased with the strong momentum in executing our strategic priorities, including rationalising our UK portfolio and the large-scale redeployment of capital into South African opportunities with superior long-term growth prospects,” said Equites CEO Andrea Taverna-Turisan.
“The reallocation of capital from UK disposals into South Africa is expected to improve earnings quality and capital efficiency and to underpin sustainable growth in distributions over time.”
He framed the shift as reflecting South Africa’s stage in the logistics cycle, drawing comparisons with the earlier phase of modernisation in the UK as that market evolved towards more advanced supply-chain infrastructure over the past decade.
“The UK has been on a logistics upgrade since 2010, and that escalated every year through the decade, then Covid just pushed it to a different level. The quantum of product that was being developed started there,” Taverna-Turisan said, pointing to the shift towards modern logistics requirements such as higher-spec buildings, flat floors, larger yards, and omnichannel-ready layouts.
The reallocation of capital from UK disposals into South Africa is expected to improve earnings quality and capital efficiency and to underpin sustainable growth in distributions over time.
— Andrea Taverna-Turisan, Equites CEO.
He said South Africa was now experiencing a momentum shift in how retailers and logistics operators think about supply chains, with greater emphasis on product availability as a direct driver of revenue performance. “People and organisations are realising that the bedrock of driving revenue is really about having availability of products in store or in distribution centres ready for an online purchase,” he said.
Taverna-Turisan added that, until recently, relatively few South African companies had invested meaningfully in the systems and infrastructure required for modern supply chain operations, but this has changed with the entry and growth of platforms such as Checkers Sixty60, Bash and Amazon, alongside broader investment across FMCG and retail sectors.
“Retailers’ internal supply chain teams realised that they couldn’t invest the capital required to operate at the optimal level in real estate that was effectively not designed for it or was antiquated,” he said, noting that older logistics infrastructure lacks the physical capacity needed to implement modern supply chain systems effectively.
“Our expectation is that they’re going to need to start being more and more competitive in terms of how they price and the technology that they use to install in old warehouses,” he said, as legacy facilities become increasingly difficult to justify upgrading at scale.
Taverna-Turisan added that over the next three to five years, a number of large FMCG contracts are expected to come to market, requiring significant investment in logistics technology.
South Africa remains in the early stages of this transition, with a growing divergence between retailers that have successfully adapted their supply chains and those that have not, according to Taverna-Turisan.
In South Africa, Equites said demand for modern logistics space continues to outstrip supply, driven by supply-chain restructuring, e-commerce growth, and investment from retailers and FMCG groups. This has supported rental growth and low vacancy in key nodes, alongside an active development pipeline of about 170,000m2 led by 3PLs, automotive suppliers, and FMCG tenants.
Within this context, Equites was awarded a 90,000m2 logistics development for Tiger Brands, in partnership with Tridevco, which management cited as an example of large FMCG groups rethinking and investing in dedicated supply-chain infrastructure after extensive internal evaluation.
The award followed an 18-month competitive request for proposal process involving multiple developers. Taverna-Turisan said Equites was selected for its broader value proposition, including a tailored logistics solution and long-term operational design, rather than price alone.
He said efficiency gains from consolidation become even more important amid fuel price volatility and geopolitical pressures linked to the war in Iran. “The biggest pressure point is going to come with diesel prices. It will foster even tighter thinking in terms of getting your logistics situation as efficient as possible,” Taverna-Turisan said.
He pointed to consolidation strategies as a key response, with large FMCG groups increasingly moving away from multiple regional warehouses toward single, centralised distribution hubs that reduce truck movements and improve overall supply-chain efficiency.
He said this was also driving the rise of last-mile delivery platforms in South Africa, which function less like traditional warehouses and more as consolidation points that feed smaller delivery fleets for neighbourhood-level distribution, where fulfilment costs remain highest in the supply chain.
Business Times
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