Hyprop's business model

GROUP OVERVIEW

In doing business, we understand that the six capitals (financial, operational, human, natural, social and relationship, and intellectual) influence the group and its impact on society, the environment and the economy. We have considered our activities against these capitals and believe that we operate responsibly in the best interest of stakeholders, as a good corporate citizen.

The goal of this integrated report is to enable stakeholders to ascertain Hyprop’s short, medium and long-term sustainability, which can be viewed from two perspectives: value created for the company and value created for stakeholders.

While providers of financial capital are interested in the value the group creates for itself, the value it creates for stakeholders may affect Hyprop’s ability to create value for itself. Our business model illustrates how the company balances this value creation for the benefit of all stakeholders, based on the core principles of our mission.

Vision

Hyprop’s goal is to preserve its status as the leading specialist shopping centre REIT in sub-Saharan Africa, offering shareholders access to income and capital growth through a specialist portfolio of premium shopping centres in a transparent, sustainable investment vehicle.

   

Mission

Bullet The partner of choice for tenants, shoppers, employees and investors
Bullet Provide a trustworthy, transparent and sustainable investment
Bullet Promote social and environmental sustainability
Bullet A world-class REIT that adheres to global best practice

Inputs   Outputs   Outcomes
Financial
Sources of funding: debt and equity
Economic climate
 
Capital investment growth
Regular and progressive distribution growth
Low and responsible loan to value
Disposal of non-core assets
 
Like-for-like increase in NAV of 13,4%
Low loan to value of 22,9%
Proceeds from disposals used to reduce debt
Provide a trustworthy and transparent investment
Operational
High-quality, dominant shopping centres in metropolitan areas in strong economic nodes
Internal asset and property management
 
Rising property values
Strong contractual rental escalations
Extracting synergies, eg national service contracts
Well-contained cost structure
Geographic diversification in high-growth countries
 
Sustainable income growth
Improved cost-to-income ratio of 33,6%
Occupancy rate improved to 98,0%
Arrears constitute 0,6% of rent roll
Distributions for the year up 15%
Expansion into sub-Saharan Africa, with R5 billion previously approved for investment
Intellectual
IT systems
Regulatory compliance
 
Integrated electronic property management system
Internal functions such as human resources driven by technology
Dedicated national legal executive
 
Reliable controls and processes supporting transparent disclosure
Strong compliance with regulatory requirements
Strong leases
Human
Experienced board of directors
Hands-on executive management
Employee development programme in place
 
Sound investments providing long-term superior investment returns
Implemented share incentive scheme
Training targets exceeded during the year
Well-managed portfolio of properties generating growing income
 
Continuity and synergy
Implemented share incentive scheme to retain low turnover of executive management and to align company vision and strategy
Develop staff productivity and retain low staff turnover
Social and relationship
Black economic empowerment and employment equity
Education and training
Hyprop Foundation
 
Sustainable social responsibility through education, training and enterprise development
 
Addressing skills shortage
Reliable succession plan
Opportunity to give back to stakeholders
Improved reputation
Natural
Environmental, social and corporate governance strategy
 
Environmentally efficient properties
Second year of participating in Global Real Estate Sustainability Benchmark (GRESB)
Institute of Directors (IoD) governance assessment
 
Reduced environmental footprint
A number of projects aimed at improving energy efficiency were completed during the year. To date, these have saved 14,2 million kWh with cost savings of R15,9 million
AAA rating in IoD governance instrument

 
REGISTERED OFFICE AND BUSINESS ADDRESS

Registration number: 1987/005284/06
2nd Floor, Cradock Heights, 21 Cradock
Avenue, Rosebank, 2196
PO Box 52509, Saxonwold, 2132
Tel: +27 11 447 0090
Fax: +27 11 447 0092
Website: www.hyprop.co.za

  INTERACTIVE CHARTING

The interactive graph tool allows you to compare data for various elements over the last 5 years. You are able to choose data from the "Five year financial review tables.





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  E-BOOK

Use the following link to view the E-Book.

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