Retail sector remains resilient

"The trend towards discounted goods or those which offer the best value for money is increasingly evident, particularly as consumers demonstrate willingness and growing ability to manage debt, which is positive, as is the interest rate, which has held stable at historically low levels. Although discretionary spend is still under pressure, the retail categories of household goods, textiles, pharmaceutical and apparel remain well supported," says Engelbrecht.

He says however, in selective nodes and in exclusive environments where there is a sustainable flow of consumers and continued spend - such as in the redeveloped, prime-located Sandton City, situated within easy reach of the Gautrain - retail sales are performing well.

"Although retailers also have to contend with the pressures of rising operational and utility costs, coupled with affordability of space, through proactive management, we have managed to keep vacancy levels at our regional shopping centres very low, below 4%, while sales turnover of these centres increased on average by 7% over the past year." The company manages over 2.2 million sqm of retail space in Southern Africa in 240 shopping centres.

"Through ongoing attention to the specific needs of retail tenants, ensuring the right tenants have the preferred position, size, layout and design and taking the tenant mix into account for consumer spend and behaviour, we have seen these shopping centres consistently achieve good sales. We are also exploring energy saving methods, inverter approaches to energy supply and additional water storage tanks.

"Further positive news is renewed capital investment in retail. The extension of Greenstone Shopping Centre near Edenvale CBD in Gauteng has approximately 6400 sqm fully let and opened in December 2011. Driven to a large extent by the launch of a new Edgars, which has proven a major draw card for shoppers, coupled with the re-mix and relocation of stores, this project has paid off and the centre is performing well."

Engelbrecht says currently a substantial revamp is planned for the Kolonnade Mall in Montana, Pretoria North. "This upgrade will create an environment which will support the very loyal market which has shopped there for the past 25 years and attract new shoppers, as well as serve to extend the centre to create larger areas for leading retailers."

Engelbrecht adds the company aims to grow its retail business unit significantly over the next few years. "Through consistent performance we are looking to increase our portfolio of managed retail centres, including into Africa. With a view to further growth, we recently opened an office in East London as we believe there is considerable potential growth in the stretch from Mthatha through to Port Elizabeth," he concludes.