Fourways Mall managers win option over up to 15% after turnaround
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The asset and property managers of Fourways Mall have been granted a call option over up to 15% of the R8.4 billion shopping centre after vacancies fell from 18.8% to 6.6% under their stewardship.
Flanagan & Gerard and Luvon, the asset and property managers of Fourways Mall, have been granted a call option to acquire a share of up to 15 per cent of the property from co-owners JSE-listed Accelerate and Azrapart, an entity controlled by Michael Georgiou that is currently in business rescue.
The option forms part of a new property, development and asset management services agreement between the parties. Accelerate shareholders will still have to vote to approve the appointment of the managers. The two firms were first appointed in February 2024, but the agreement lapsed later that year after certain conditions were not fulfilled, and both remained on site to render the services.
Accelerate and the business rescue practitioners, Piers Marsden and Lance Schapiro, said the turnaround justified regularising the appointment and retaining the managers in order to unlock the mall's full potential. Vacancies across the 179,973 square metre centre have fallen from 18.8 per cent in February 2024 to 6.6 per cent in August 2026, tenant turnover has risen 61 per cent from R226.3 million to R365.2 million, and trading densities are up from R1,816 to R2,711 per square metre.
The mall this week opened The View, a R100 million food and restaurant wing with a three-storey atrium whose tenants include The Pantry, tashas, Fournos Bakery, Nossa Casa, Clay Cafe and George's Grill. Co-working operator Workshop 17 has also taken space in the same part of the centre, on the corner of Cedar and Witkoppen roads.
The call option includes an upside participation fee should the managers' services be terminated before the end of a five-year contract. It is tied to a single performance hurdle, that normalised net monthly collections do not fall below R15.6 million in year one, with annual increases of CPI plus 1 per cent thereafter. The protection fee is set at R130 million, R140 million and R150 million in years three, four and five, and may be taken in cash or shares. Fourways Mall is valued at R8.4 billion, with Accelerate's 50 per cent stake worth R4.2 billion.