Five days of devastation and the impact on the national GDP from looting and damage to South Africa’s shopping centres, malls, warehouses and infrastructure is estimated at R50bn, says the South African Property Owners Association (Sapoa).
Following the civil unrest that unfolded in KwaZulu-Natal (KZN) and Gauteng after former president Jacob Zuma’s arrest, about 200 shopping centres were looted and damaged, 100 malls were burnt down or suffered significant fire damage and around 3 000 stores looted.
The total impact of GDP loss in KZN alone is estimated at upwards of R20bn, reports Sapoa. Some R1.5bn was lost in stock, R15bn lost to property, over 50 000 informal traders have lost their livelihoods, approximately 1.5m people have lost their potential to earn an income and some 150 000 jobs are at risk.
In many cases, those malls in black townships were built to improve the lives of the communities, and those that are going to be most affected by the loss of income will be the very people the malls were set up to serve, Sapoa president-elect and CEO of Pareto Limited, Malose Kekana, said in a press briefing.
Izak Petersen, CEO of SA-focused real estate investment trust (Reit), Dipula Income Fund, tells finweek: “There is a fair amount of regret among the communities. They’ve realised how important these assets are in their lives and our sense is that they are unlikely to willingly be a participant in something like this going forward.”
As damages are still being assessed, Estienne de Klerk, Chairman of the SA Reit Association and CEO of Growthpoint Properties SA, says it is still too early to quantify the value of damage to the Reit sector. But he cites an example of a logistics warehouse burnt down in Durban that he believes has incurred damage of around R200m.
Dipula Income Fund, Fairvest Property Holdings and SA Corporate Real Estate were among the Reits most affected in terms of number of properties targeted by rioters and looters.
Dipula’s 12 impacted properties comprise approximately 6% of total gross lettable area (GLA). “The damage estimate number runs into many millions, although lower than what we initially anticipated,” Petersen tells finweek.
Twelve of Fairvest’s 43 properties fell prey to the unrest, two of them partially burnt, while SA
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