Spear REIT strengthens Western Cape growth

• DIPS guidance lifted to 5% - 6%, trending toward upper end of range.
• Portfolio expands to R6.8bn with 97.28% occupancy and 99.13% cash collections.
• R1.074bn deployed into high-yield Western Cape acquisitions at 9.54% average yield.

Regional Focus, national grade performance

Spear REIT has reinforced its position as the Western Cape’s only regionally focused JSE-listed REIT, reporting strong operational momentum in its FY2026 pre-close presentation.

The Cape-centric fund continues to demonstrate disciplined growth, underpinned by portfolio expansion, robust cash collections, high occupancy levels and a strengthened balance sheet.

In January 2026, management revised its distribution per share (DIPS) guidance to growth of 5% - 6% for the financial year ending 28 February 2026, with performance trending toward the upper end of that range.

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Quintin Rossi, CEO of Spear REIT, said: “Management is pleased to report that Spear will achieve a mission-statement-aligned outcome for FY2026, resulting in DIPS guidance of 5% - 6% higher than FY2025, which is trending towards the upper end of its range at year end.”

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Portfolio scale and financial strength

‍Year-to-date, Spear’s portfolio has grown to R6.8 billion, comprising 42 Western Cape assets with total gross lettable area (GLA) of approximately 627,000m².

Key metrics include:

• 97.28% occupancy
• 99.13% cash collections
• Weighted average lease escalation of 7.05%
• Average unexpired lease term of approximately 29 months

Rental renewals delivered positive growth of 5.83%, while overall reversions remained marginally just below flat, reflecting stability in a competitive leasing environment.

Since interim results, overall portfolio occupancy improved by 2.25%, highlighting continued letting momentum.

Strategic acquisitions drive yield

‍During the period, Spear deployed R1.074 billion into three strategic Western Cape acquisitions at an average yield of 9.54%.

The new assets include:

• Berg River Business Park (Paarl)
• Maynard Mall (Wynberg)
• Consani Industrial Park (Goodwood)

These acquisitions added 137,090m² to portfolio GLA.

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Rossi commented: “Spear’s growth strategy is delivering in line with its strategy, with the recently acquired assets increasing portfolio valuations to R6.8 billion prior to fair value adjustments.”

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The acquisitions reinforce Spear’s regional specialisation strategy,  focusing on quality assets within the Western Cape, particularly the Cape Town metro and surrounding growth nodes.

Sector Performance: Industrial leads

‍Industrial remains the dominant sector within the portfolio by GLA, value and revenue.

Performance by sector

• Industrial: 98.77% occupancy with positive rental reversion of 2.38%
• Retail: 96.68% occupancy
• Commercial: 92.64% occupancy with improving letting momentum

The industrial segment continues to anchor performance, supported by strong demand across logistics and light manufacturing nodes in the province.

Balance sheet built for growth

‍Spear’s balance sheet remains conservatively positioned:

• Loan-to-value ratio: 24.62%
• Interest cover ratio: 4.39 times
• Liquidity available (net of allocations): R400 million

During the year, the REIT raised R749 million in equity capital and concluded a further R152 million Section 42 share issue, strengthening funding flexibility.

The payout ratio will be maintained at 95%, in line with board approval.

Renewable energy expansion

‍Spear continues expanding its renewable energy footprint, with 28 assets fitted with solar infrastructure and two additional systems under construction.

Solar performance year-to-date:

• R25.9 million in gross revenue
• R17.3 million in net operating income

This not only reduces operational risk but also enhances asset resilience and tenant attractiveness in a constrained energy environment.

A Western Cape specialist with scale

Founded in 2011 and listed on the JSE in November 2016 with assets valued at R1.4 billion, Spear has grown into a R6.8 billion diversified portfolio across commercial, industrial, retail and mixed-use assets, all within the Western Cape.

It remains the only regionally focused REIT on the JSE dedicated exclusively to high-quality Western Cape property.

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Rossi concluded: “The FY2026 pre-close reflects the outcomes of a year where momentum was built from start to finish, driven by strong operational and financial performance… enabled by active asset and hands-on property management.”

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The bottom line

‍Spear’s FY2026 pre-close numbers confirm three things:

1. Regional focus is working.
2. Industrial-led growth remains resilient in the Western Cape.
3. The balance sheet is positioned for disciplined expansion.

In a market where many funds are chasing national diversification, Spear continues doubling down on Cape fundamentals and the results suggest that strategy is delivering.

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