Vukile Property Fund Limited (“Vukile”) is a JSE-listed REIT with a retail-oriented investment strategy, whose asset base is underpinned by a domestic portfolio, and exposure to Spain through a 72% shareholding in Castellana Properties SOCIMI SA ("Castellana"). Castellana is a c.EUR1bn (by total assets) fund that listed on the Spanish Alternative Stock Exchange ("MAB") in July 2018. Vukile has remained aligned to its core strategy in its expansion into Spain, investing directly in defensive retail assets by leveraging internal competencies and by building a strong in-country team. The focus is to build sustainable dividend progression. As such, growth over the rating horizon will be partly driven by investment in existing assets, with selected acquisitions in both jurisdictions.
The stable outlook reflects GCR’s view of sustained earnings rigour, with margin progression supported by low vacancies, strong tenant retention and rental yield improvement underpinned by ongoing asset enhancement.