Property sector still holds promise

Image courtesy stock.xchnge (KillR-B)

Image courtesy stock.xchnge (KillR-B)

While investors should be cautious about investing in some of the smaller property funds, they do still offer attractive yields.

Business recently highlighted that smaller investors were finding themselves pawns in the corporate wheeling and dealings of some of the larger players who are consolidating the listed sector.

One fund to keep an eye on is the rapidly growing Tower Property Fund which was listed in 2012 and now has a property portfolio of R1.64bn.

The company yesterday announced that it had spent R226m purchasing the De Ville Shopping Centre. One concern is that rentals may come under pressure as the consumer pinch starts.

Property sector specialists Catalyst Fund Managers have a more moderate view:

The retail sector is characterised by positive trading density and footfall growth despite consumer weakness. A two-tier market exists with dominant retail malls experiencing inflationary like reversions with certain non-metropolitan growth nodes doing even better.




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