Repairs to looted Springfield Retail Centre will take until 2022, but Emira is staying
The owner of the Springfield Retail Centre – which was at the epicentre of looting during the July unrest in KwaZulu-Natal – says that won’t send it packing, and the incident hasn’t changed its mind about investing more into its properties.
Emira Property Fund, which published its annual financial results on Wednesday, said out of its many properties in KZN, looters only touched the Springfield Retail Centre. The property was looted and suffered fire damage to a third of its structure
The structural repairs required after the fire damage will take up to March 2022 to complete, though Emira expects damaged parts that don’t need structural repairs to be fully operational by October. But the grocer anchor in that centre, Food Lover’s Market, is already back in full operation after closing for 12 days due to being looted and damaged.
Emira’s other retail properties in KwaZulu-Natal include Granada Square in Umhlanga and Park Boulevard in Durban North. But it also has office buildings in the province and four industrial properties.
Emira CEO Geoff Jennett said that the centre was the only one of Emira’s 77 directly held properties that the unrest affected. He said the damage to Springfield equates to about 0.4% of Emira’s total assets.
“I think you can draw a lot of comfort from the fact that we have got full and substantial Sasria cover, not only on the building value but also on the loss of rental income, probably to the tune of about R1.5 million,” said Jennett.
But Emira also holds stakes in other properties through Enyuka Property Fund, as well as listed residential property fund Transcend.
Enyuka, which has shopping centres in rural towns and low-income areas, had six of its 24 properties extensively looted, all in KwaZulu-Natal. The properties were also damaged, and one of them suffered structural damages due to fire.
Emira said Enyuka also has adequate Sasria riot insurance to cover the damages and the loss of rental income. Five of its six damaged properties are expected to be fully operational by the end of September, while the portion of the property that sustained fire damage will reopen in May 2022.
Not changing plans
Emira COO, Ulana van Biljon said the group won’t change its plans or rush to dispose of properties in the affected areas or anywhere in SA because of the unrest. Instead, it plans to continue investing in its existing properties.
“No, I don’t think because of the unrest in Gauteng and KZN, it suddenly means we must now say that we are now not going to invest in those two areas,” said Biljon.
Jennett said Emira would like to grow its residential property portfolio which will likely happen via Transcend. It also sees growth opportunities to grow its industrial portfolio and reckoned that those plans will not be affected by the pandemic or the recent unrest. The only area where the company is not looking to buy any more properties, for now, is retail and office buildings.
In fact, Emira is selling its Epsom Downs Shopping Centre, the Epping Warehouse and The Colony Shopping Centre. The company said the only reason it is disposing of these properties is because they were not “core” to its portfolio and not part of its long-term strategy.