Redefine Properties, a prominent owner of South Africa’s top shopping malls, has announced significant changes to the retail space allocated to major tenants, including Pick n Pay, Game, Ster Kinekor, and Edgars. The company, which owns notable malls such as Centurion Mall, East Rand Mall, and Blue Route Mall, revealed these updates during its recent Capital Markets Day presentation.
In an effort to optimize space and increase trading density across its shopping centers, Redefine Properties will reduce the space rented to these four major retailers:
- Pick n Pay: Space will be reduced by 10,000 square meters across Redefine’s shopping centers.
- Edgars: A reduction of 4,500 square meters has already occurred, with an additional 3,000 square meters planned.
- Game: One store has closed, and its space has been reduced by 9,000 square meters.
- Ster Kinekor: The number of cinemas will decrease from six to two in the next financial year.
The 10,000 square meters reclaimed from Pick n Pay will allow Redefine to better utilize space and enhance trading density in its malls. Pick n Pay, which has been underperforming as an anchor tenant in some locations, is also adjusting its retail footprint as part of a broader strategy to modernize stores.
Redefine Properties has already relet the space taken from Edgars and Game at higher gross market rents (GMR). For instance, in the Mall of the South, space previously occupied by Game has been reallocated to Shoprite and other value-focused retailers, boosting the company’s trading margin from 81% to 85% and increasing trading density.
The closure of Ster Kinekor cinemas is also seen as a strategic move to mitigate rental income risk, with the vacated space already relet.
Redefine Properties acknowledged that online shopping continues to impact retail behavior and shopping mall dynamics. While online retail in South Africa accounts for a smaller percentage of the market compared to developed countries, it is expected to grow. The company is therefore focused on attracting omnichannel retailers and improving its tenant mix by bringing in "experience-based retailers" to adapt to the changing market landscape.
