JSE-listed Vukile Property Fund achieved a 9.3% year-on-year increase in funds from operations (FFO) and dividends a share for the financial year ended March 31.

The specialist retail real estate investment trust’s performance exceeded guidance while it further strengthened its Iberian portfolio and undertook its first foray into Italy.

Through its 99.7%-owned subsidiary Castellana Properties, Vukile is invested in a €2.2-billion portfolio across Spain and Portugal.

During the year under review, it also acquired a 35% stake in Pradera, the pan-European retail fund and asset manager with €5-billion of assets under management.

Vukile entered the Italian market post year-end with an inaugural €115-million portfolio of three shopping centres, establishing its new Italian holding company Esperia Properties as a platform for further expansion.

With post-year-end acquisitions, Vukile holds a total of R63.7-billion in assets, with close to 70% of its assets in Europe.

In South Africa, Vukile has a R19.5-billion portfolio of township, rural, urban and commuter malls.

Vukile recorded like-for-like net operating income growth of 10.3% in South Africa and 7.9% in Iberia.

Retailer sales in the South African portfolio grew by 5.4% and footfalls increased by 2.2%. Vacancies were down 1.7%.

Rental reversions were 3.7%, up from 2.3%, with 90% of leases expiring renewed at positive or the same levels.

The portfolio’s cost-to-income ratio improved from 15.3% to 12.4%, underpinned by electricity savings, with Vukile’s solar PV installations now exceeding 40.3 MW and generating 29% of electricity in the portfolio.

Vukile’s like-for-like South African portfolio was valued 12.3% higher.

Castellana’s Iberian portfolio delivered similarly good results.

Vukile undertook decisive, disciplined capital allocation during the period.

After raising R2.65-billion in October 2025, the company capitalised on opportunities it perceived in the market.

Shareholders unanimously approved a further 9% extension to Vukile’s authority to issue shares. The company went on to raise R2.8-billion in a capital raise.

The Vukile team created value of €132.5-million in Iberia and R134.5-million in South Africa over the past 18 months.

Vukile ended the year with liquidity of almost R8-billion.

Its loan-to-value ratio decreased to 38.4% and its interest cover ratio increased to three times.

Ratings agency GCR upgraded Vukile’s credit rating to AA+(za) with a stable outlook, while Fitch upgraded Castellana’s rating to an investment grade BBB.

In South Africa, Vukile concluded R1.7-billion of transactions. The company disposed of R630-million of assets.

It also took transfer of a 50% stake in Chatsworth Mall in KwaZulu-Natal, acquired for R620-million at a yield of 8.7%.

Vukile is also acquiring 100% of Botshabelo Mall in the Free State for R433-million, which is anticipated to yield 8.6% and transfer in July.

In Spain, Vukile executed transactions of €902-million.

Looking ahead, Vukile expects continued robust operational results from its South African and Castellana portfolios and has value-add projects planned in Spain and Portugal.

The company’s capital allocation focus will remain on accretive opportunities in its core markets of South Africa, Spain, Portugal and Italy.

Vukile forecasts FFO per share growth of between 8% and 10% and dividend per share growth of 10% to 12% for the financial year ending March 31, 2027.