Cape Town, 22 October 2026 – Western Cape-focused real estate investment trust (REIT) Spear has reported a guidance beating first half of FY2027, delivering 8.02% growth in distributable income per share (DIPS), ahead of its previous full-year guidance of 6% – 8% DIPS growth, as the group continues to expand through strategic acquisitions, developments and positive rental growth.
For the six months ended 31 August 2026, revenue increased by 28.14% and net operating income grew by 27.80%, supported by strong rental collections, high occupancy and continued leasing activity across its industrial, commercial and retail properties.
HY2027 financial and operational highlights
- DIPS increased by 8.02% to 47.29 cents, exceeding the upper end of previous FY2027 guidance of 6%–8%.
- Distribution per share (DPS) of 44.92 cents, reflecting a 95% payout ratio.
- Full-year DIPS growth guidance upgraded to 9%–11%, from 6%-8%
- Revenue increased 28.14%, with net operating income up 27.80%.
- Portfolio occupancy of 96.60%, with cash collections of 99.23%.
- Positive rental reversions of +7.98%
- R1 billion in new equity raised, with a further R108 million retained through the dividend reinvestment programme.
- R1.4 billion in acquisitions completed, expanding the portfolio to 44 Western Cape properties valued at R8.8 billion.
- Property valuations increased by R267 million (3.81%) during the half-year.
- Tangible net asset value (TNAV) of R13.33 per share, with a loan-to-value ratio of 21.91%.
Following the most recent acquisitions valued at a combined R1.4 billion, Spear’s portfolio has grown to 44 assets, valued at approximately R8.8 billion, comprising more than 674,000 m² of lettable space, adding the Santam Precinct in Tygervalley and Watergate Centre in Mitchells Plain to its portfolio. The Tygervalley property comprises 28,488 m² of premium-grade office accommodation occupied by Santam and Sanlam, while the 19,681 m² Watergate Centre expands Spear’s exposure to convenience retail serving established residential communities.
The new acquisitions transferred into the portfolio in late August 2026 and will contribute to earnings from their respective transfer dates.
The acquisitions follow a successful R1 billion capital raise in April 2026, which was multiple times oversubscribed, and supports Spear’s strategy of investing in established Western Cape commercial, industrial and retail locations.
Quintin Rossi, CEO of Spear REIT, says the results reflect the strength of the group’s regional investment strategy and its focus on actively managing its properties.
“Against a backdrop of rising municipal charges, higher electricity costs and pressure on businesses from interest rates, our underlying portfolio has performed well. Strong occupancy, rental growth and collections have supported earnings, while our balance sheet gives us the flexibility to pursue further growth opportunities. Our focus remains on owning quality properties in locations where we understand the market and can add value through hands-on management.”
Spear’s industrial portfolio remains its strongest-performing segment, with occupancy of 98.22% and rental growth of 13.49% on renewals and new lets. Industrial property accounts for approximately 63% of the group’s total lettable area, reflecting sustained demand for logistics, warehousing, manufacturing and distribution space.
“Demand for well-located industrial property in the Western Cape remains encouraging, particularly where available stock is limited and the cost of new development is high,” says Rossi. “We are also seeing opportunities across convenience retail and quality office accommodation, allowing us to grow the portfolio selectively without compromising on the quality of our assets.”
Alongside its acquisitions, Spear is progressing an organic industrial development programme expected to add approximately 12 650m2 to the industrial portfolio valued at R140 million over the next 12 months.
Construction is underway at GTX Industrial Park adjacent to the George Airport, where the first 5,500 m² of multi-let industrial space is scheduled for completion in March 2027. The development provides Spear with exposure to the growing demand for commercial and industrial space in George and the wider Garden Route.
In Blackheath, Cape Town, a new 7,150 m² national distribution centre for Mambos Storage & Home is under construction following the conclusion of a 10-year lease. The R90 million development is scheduled for completion in July 2027.
Spear has also acquired 25,000 m² of commercially zoned land in Century City for approximately R53 million, with development planning underway.
The group’s renewable-energy investments are making a growing contribution to property income. Solar infrastructure is now installed across 29 assets, generating approximately R19.45 million in revenue during the reporting period.
Solar generation increased to 6.16 million kWh from 3.55 million kWh in the comparable prior-year period, while a further 1.2 MW installation at Watergate Centre will expand capacity.Spear’s total installed solar capacity across the portfolio currently stands at 18.4 MW with the medium term strategy to grow this to 20 MW.
Outlook
Spear enters the second half of FY2027 with a conservative balance sheet and additional capacity to pursue acquisitions and developments.
The group’s inclusion in the FTSE/JSE All Property and SA REIT indices in March 2026 has also strengthened its capital markets profile and substantially improved liquidity.
While rising municipal charges, higher electricity costs and interest rates remain considerations, management expects continued rental demand and contributions from recent acquisitions to support performance for the remainder of the financial year.
On the back of its first-half performance, management has upgraded its FY2027 DIPS growth guidance to 9%–11%, compared with the previous range of 6%–8%. The Board continues to target a 95% payout ratio.
“Our priority is to build on the momentum achieved in the first half, while remaining disciplined in how we allocate capital,” concludes Rossi. “The Western Cape continues to offer opportunities for investment and development, and we believe our combination of a strong existing portfolio, new acquisitions and a growing development pipeline positions Spear well for sustainable earnings growth.”
