Property updates you have to read

Good Morning Voornaam,

Yesterday was a really busy day on the JSE for property updates. If you just want to cut straight to the chase and read snippets of Hyprop, Emira, Safari and Rebosis, alongside updates from companies like Sasol and the JSE (yes, the JSE is listed on the JSE!) then you can go straight through to Ghost Bites. It's the most efficient and effective way to stay up to date with news on the JSE.

If you have more time this morning for me, then I would like to really encourage you to read the feature articles.

The first is on Hyprop, the retail-focused property fund that was give n a proper smack by the pandemic. The trends in the numbers are quite incredible really, giving us a sharp reminder of what life was like in April 2020. The good news is that masks are either packed away in the cupboard or possibly stashed in your braai as an alternative to firelighters. Either way, double chins have nowhere to hide anymore as most people are thrilled to be walking around and smiling at each other.

There's solid data in the Hyprop update that supports my thesis around the impact on shopping malls of masks going away. In Eastern Europe, the masks were ditched in March 2022 and the results are great for the malls, with trading performance ahead of pre-Covid levels. Locally, trading density (sales per square metre) have been ahead of pre-pandemic levels but foot count has been lower. Simply, people are doing fewer trips with larger basket sizes.

Now that masks are gone, what will this mean for shopper behaviour? Will destination shopping becom e a thing again, rather than ordering everything online? Poor Takealot hasn't even made a profit yet, so Naspers will hope that we continue to buy our general merchandise from home. I'm not so convinced, as people enjoy getting the family out the house for a shopping trip.

This may all sound anecdotal and silly to you, but consumer behaviour is what drivers the consumer sector (and that includes retail property funds). Looking around at how your immediate circle is behaving is often the strongest investment research you can do. With the support of the Eastern European data, I'm seriously considering using my EasyEquities account to enter a long position in Hyprop. You can read this article to understand why.

I've also written on Emira, a diversified property fund that gives us a broader view of what is going on out there. The reversions are particularly interesting, as Emira seems to be having some success in its office portfolio. Although the impact will be to a lesser extent than in retail portfolios, there should be a positive effect on office property from the masks disappearing. People will feel more encouraged to go back to some degree of normality. Whilst hybrid working is here to stay in my view, a hybrid environment still requires an office of some sort. Oversupply will be addressed at some point and astute investors will make money. To get up to speed on Emira, read this article.

PGM and chrome mining group Tharisa is in the hot seat today on Unlock the Stock. The event is free to attend and takes place online at 12pm today. You just need to register at this link to attend and ask questions directly to the mana gement team. I'm no expert in mining whatsoever, so I am personally really looking forward to the opportunity to learn.

If you think equities are tricky to manage, you should try the rand. Wichard Cilliers (Head of Market Risk at TreasuryONE) always has us covered with TreasuryONE's views on what might happen in this volatile environment. Stage 6 load shedding has obviously caused pain for the rand, made worse by the strength of the US dollar against major currencies. This has led to the rand breaking the R16.20 level, with an expectation for short-term pressure on the rand. In other news, Fed Chair Powell has admitted that whilst the US economy is in solid shape, it is becoming more challenging to ensure that it won't go into a recession. This acknowledgement of even the risk of recession by Powell did no favours for emerging markets currencies. The recession talk hasn't bothered oil too much, trading at $119 b ased on supply constraints in the market. Gold has taken a knock, trading lower at $1,815 per ounce.

If your business operates with forex exposures or if you need treasury management solutions, I highly recommend reaching out to the team at TreasuryONE. They are a great bunch of people and they know what they are doing. Visit the website here.

On the podcasting front, a new Magic Markets episode being in the wild later today means that this is the last time I'm sharing the great discussion with the team from Westbrooke Alternative Asset Management about "hybrid capital" - a debt-led approach to private equity. If you want to understand more about private investment structures, this episode is such a worthwhile use of your time.

For those raising money or building businesses, the Ghost Stories discussion with Charles Savage gives invaluable insight into what it takes to build a business with real impact in its chosen market. We had a brilliant conversation about EasyEquities, including where the app has come from and where it is headed. Make the time to listen to this great show.

I hope you make the most of your PowerWindows today (trademark still pending) and remember to smile - people can actually see that now!