Table of Contents
Key points:
- Burnstone, with Flanagan & Gerard, acquired a 50-percent stake in The Neighbourhood Square for R380 million ($21 million), enhancing their retail portfolio.
- The acquisition follows successful past transactions and marks a strategic move to boost long-term income and capital growth.
- Plans include retail mix refinements and renewable energy investments, ensuring improved customer experience and sustainability at the center.
Burnstone, in partnership with Flanagan & Gerard, has acquired a 50-percent stake in The Neighbourhood Square for R380 million ($21 million).
Following successful past transactions, this acquisition marks a move to boost long-term income and capital growth. Additionally, the plans include refining the retail mix and investing in renewable energy, aiming to improve customer experience and sustainability at the center.
Listed on the Johannesburg Stock Exchange (JSE), Burnstone is led by South African CEO Andrew Wooler. The company has successfully closed this significant R380-million ($21 million) deal, partnering with retail real estate specialist Flanagan & Gerard, thereby expanding Burnstone’s retail portfolio.
The Neighbourhood Square, a 10,000-square-meter open-air convenience retail center, boasts an impressive tenant mix. It includes 86 percent national retail tenants and dual anchor tenants, Checkers and Woolworths. Known for its exceptional trading metrics and zero vacancy rate, the center stands as a valuable addition to Burnstone’s holdings.
Moreover, Flanagan & Gerard will assume a strategic asset management role for The Neighbourhood Square. Paul Gerard, managing director of Flanagan & Gerard, highlighted the center’s popularity and strong demand from prospective tenants, indicating a robust future for the property.
Historical context and future plans
The deal continues a series of successful collaborations between the two companies. For instance, in 2020, Flanagan & Gerard, alongside Moolman Group, acquired a 50 percent stake in Musina Mall from Investec Property Fund. This demonstrated their proven track record in strategic property acquisitions and management.
In 2023, the transformation of Investec Property Fund into Burnstone Group marked a pivotal moment. It allowed Burnstone to secure The Neighbourhood Square, aligning with its vision to expand in the premium retail space.
Enhancing customer experience and sustainability
Burnstone and Flanagan & Gerard have committed to further enhance The Neighbourhood Square. Plans include general improvements and refinements in the retail mix to elevate the customer experience. New retailers, such as Thule, JJ Cale, and Wellness Warehouse, have already joined the center’s lineup, enhancing its appeal.
To support sustainability, the group is investing in renewable energy solutions. They plan to install additional rooftop solar panels to improve the center’s energy procurement, reflecting a commitment to environmentally responsible development.
Broader impact and future developments
This acquisition is part of a broader strategy by Burnstone and its partners to revitalise key retail assets across South Africa. Flanagan & Gerard, along with the Moolman Group, have developed several high-profile shopping centers, including Vaal Mall, Highveld Mall, and Mall of the North.
Recently, these groups took on the revitalisation of Fourways Mall, South Africa’s largest shopping center. A six-month strategy involving a R400-million ($22 million) investment aims to restore the mall’s premier status through improved signage, new tenants, enhanced security, and better traffic flow.
Under Andrew Wooler’s leadership and in partnership with Flanagan & Gerard, Burnstone is leveraging this strategic asset to drive income growth and enhance the shopping experience for consumers. Their continued investment in sustainable practices and innovative property management solutions reflects a commitment to creating long-term value in the retail sector
