capital property fund limited - sharedata · developments and refurbishment construction projects....

CAPITAL PRO

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Capital Property Fund Limited

FOR THE YEAR ENDED 31 DECEMBER 2014 [ ]I N T E G R A T E Dreport

Silverstone Raceway 40 796 m2 Gauteng

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CHAIRMAN’S STATEMENT BOARD OF DIRECTORSSCOPE OF THE REPORT

STRATEGY AND BUSINESS MODELDIRECTORS’ REPORT REMUNERATION REPORT

ANALYSIS OF SHAREHOLDERSSHARE PRICE PERFORMANCEKEY RISK FACTORS

CORPORATE GOVERNANCE REVIEWSUSTAINABILITY REPORTINGFIVE YEAR REVIEWPORTFOLIO STATISTICS

STATEMENTS OF FINANCIAL POSITION STATEMENTS OF COMPREHENSIVE INCOME

RECONCILIATION OF PROFIT FOR THE YEAR TO HEADLINE EARNINGS STATEMENTS OF CHANGES IN EQUITY

STATEMENTS OF CASH FLOWSNOTES TO THE ANNUAL FINANCIAL STATEMENTS

SCHEDULE OF PROPERTIES

SHAREHOLDERS’ DIARY

NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS FORM OF PROXY

ADMINISTRATIONFACT SHEET

GROUP PROPERTY PORTFOLIODIRECTORS’ RESPONSIBILITY STATEMENTREPORT OF THE AUDIT COMMITTEEINDEPENDENT AUDITOR’S REPORT

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Statement

The general business environment in the country during 2014 proved challenging. Overall, the economy laboured under the strains of protracted industrial relations disputes, led by AMCU’s strike in the platinum mining sector for much of the first half of 2014, followed shortly by NUMSA’s disruption in the manufacturing sector during July. As a result, the pace of economic activity slowed down considerably, bringing the GDP to the brink of recession. Disruptions by labour strikes were augmented by equally serious disruptions caused by Eskom and its inability to maintain reliable electricity supply for the economy. The overall socio-economic conditions placed South Africa within the global group of “Fragile Five”, alongside Turkey, Brazil, India and Indonesia. With deterioration in the actual and expected GDP growth rates, on 13 June 2014 the country’s global sovereign credit rating was slashed by Standard & Poor’s to a BBB-level, one notch above the “junk” status.

In light of the prevailing economic and business milieu, the property rental sector faced tough conditions too. There was rising pressure on the rentals combined with uncertainty of business prospects for some tenants. Municipal billing problems caused additional operational complexities for the sector too. Within this environment, Capital’s management maintained tight controls over expenses on the one hand and explored options for optimising the cost of borrowing within the capital markets on the other. Much attention was paid to the composition of the portfolio and the continued streamlining of the assets. Revenue diversification likewise received sustained attention. The board maintained focus on the company’s strategic business plan and its objectives.

CAPITAL’S CHANGE OF LEGAL STRUCTUREThe 2014 financial year was also a watershed period for Capital as it restructured its legal entity to a corporate Real Estate Investment Trust (REIT), internalising its asset management with a view to better aligning the interests of the investors with that of Capital’s management. This was done after full and proper consultation with unitholders. After receiving overwhelming endorsement, on 30 June 2014, the company’s legal structure changed from a property unit trust in the name of Capital Property Fund (the old structure) to a public company and corporate REIT in the name of Capital Property Fund Limited (the new structure).

GOVERNANCE AND BOARD MEMBERSHIPDuring the year, there were changes to the composition of the board too. Mr Willy Ross, who ably chaired the board for over 10 years, retired in September 2014 after the successful restructuring of the company’s legal nature. Mr Andries de Lange resigned from the board, and Mr Fareed Wania was appointed to the board on 17 September 2014. With effect from 27 January 2014, Mr Jan Potgieter joined the board.

On behalf of the board and the shareholders, I would like to thank Mr Ross for his long and competent service to the company and wish him well during his retirement. Also, our gratitude to Mr. de Lange who has served, and continues to serve, the company professionally.

Last, but not the least, I would like to register my gratitude to the executive management team and the non-executive members of the board who diligently and consistently exercise all efforts to safeguard the interests of the company.

C H A I R M A N ’ S

IRAJ ABEDIANChairman

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DR IRAJ ABEDIAN (59) BARRY STUHLER (57) RUAL BORNMAN (37)Independent non-executive chairman

Managing director Financial director

BA (HONOURS), MA (ECONOMICS) (UNIVERSITY OF CAPE TOWN), PHD (ECONOMICS) (SIMON FRASER UNIVERSITY, CANADA)

BCOM, BACC, CA(SA) CA(SA)

DATE OF APPOINTMENT: APR 2014 DATE OF APPOINTMENT: JAN 2014 DATE OF APPOINTMENT: JAN 2014Iraj Abedian is the founder and Chief Executive of Pan-African Capital Holdings Proprietary Limited. He was professor of economics at the University of Cape Town, before joining Standard Bank Group in 2000 as Group Chief Economist.

He obtained his BA (Honours) and MA in Economics from UCT. He received his PhD in Economics from Simon Fraser University in Canada in 1993. He was the founder and director of the Applied Fiscal Research Centre (AFReC) at UCT and he has been a consultant on economic policy issues to public and private sector organisations in South Africa as well as internationally.

His involvement in policy development in South Africa includes: The Transformation of the Development Bank of Southern Africa (1995), the RDP White Paper (1995), Growth, Employment and Redistribution (GEAR 1996), Medium Term Expenditure Framework (MTEF), and the Presidential Review Commission (PRC 1997).

He is a prolific researcher and has written numerous articles and co-authored a number of books. Iraj is a Visiting Professor of Economics at Business School, Nelson Mandela Metropolitan University, Port Elizabeth. He is a member of the board of directors of Munich Re of Africa and serves as a member of the Advisory Board of the Auditor General of the South African Government.

Barry is a chartered accountant who completed his articles with Arthur Young. Barry’s experience includes management of the Part Bond Scheme and Gilt Fund for Hill Samuel Merchant Bank. He was financial director of Integrated Property Resources and managing director of Intaprop Management Services, the property management company for the Intaprop group. In 1994 Barry co-founded Inline Properties, a property management and corporate property advisory company.

Barry is a founding director of Resilient Property Income Fund Limited (“Resilient”). Barry relinquished his duties as executive director of Resilient to become managing director of Property Fund Managers Limited (“PFM”), the asset manager of Capital Property Fund (“Capital Trust”), in 2004. He resigned as non-executive director of Resilient in February 2007.

Barry resigned as managing director of PFM to join the Pangbourne Properties Limited (“Pangbourne”) board as executive director on 17 October 2007 and was appointed managing director with effect from 1 March 2008. After the merger with Pangbourne, Barry was re-appointed as managing director of PFM. Barry continues to serve as the managing director of Capital Property Fund Limited (“Capital” or “the Company”) subsequent to the internalisation of PFM and the conversion of Capital Trust to a corporate REIT.

After completing his articles with KPMG, Rual joined Stanlib where he was involved in management reporting, accounting and system integration.

He then joined a consulting firm implementing reconciliation systems at Stanlib, before being employed by the Resilient group in 2005.

[ [ [] ] ]

DirectorsB O A R D O F

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DAVID LEWIS (48) PROTAS PHILI (40) JAN POTGIETER (46)Executive director Independent non-executive

directorIndependent non-executive director

BSC BLDG MGT, NDIP (REAL ESTATE), MBA (WITS & CRANFIELD)

BCOM, CTA, MCOM (TAXATION), CA(SA)

BCOMPT (HONS), CTA, CA(SA), MANAGEMENT DEVELOPMENT PROGRAM (UNIVERSITY OF MICHIGAN), STRATEGIC PLANNING & MANAGEMENT IN RETAILING (MONASH UNIVERSITY AUSTRALIA)

DATE OF APPOINTMENT: APR 2014 DATE OF APPOINTMENT: APR 2014 DATE OF APPOINTMENT: APR 2014David started his career with Wilson

Bayly Holmes-Ovcon Limited and

was responsible for a number of retail

developments and refurbishment

construction projects. David then joined

Boxer Superstores (now part of the Pick ’n

Pay group) as projects and development

manager and later the former Nedcor

Investment Bank Limited – corporate

equity division. He was a founding

executive director of Resilient for

10 years and was the managing director

of Diversified Property Fund Limited

(“Diversified”) until its incorporation

into Resilient.

Protas was previously the director in

the corporate finance and transactions

division of the Department of Public

Enterprises, non-executive director of

Rand Merchant Bank and WesBank,

national taxation committee member of

the South African Institute of Chartered

Accountants, deputy director-general and

chief financial officer in the Department of

Rural Development and Land Reform and

chief financial officer of Sentech Limited.

Protas also previously served on the

audit and risk committees of Mogale City

Municipality, Safety and Security SETA,

Wholesale and Retail SETA and Aventura

Holiday Resorts Limited. Protas is

currently a director of April 27 Corporate

Finance Proprietary Limited, Veterans

Capital Proprietary Limited, Anchor Park

Investments Proprietary Limited and

non-executive director and chairperson

of the risk committee of National Housing

Finance Corporation (SOC) Limited.

Jan qualified as a CA doing his articles with

PricewaterhouseCoopers. He held various

managerial positions early in his career

including business manager at Clover SA

and then seven years at various divisions of

SABMiller in senior financial roles.

In 2005, he was headhunted by Massmart

to join their Massdiscounters team first as

financial director then six years as chief

executive officer. He then did consulting

work before joining the Italtile group as

chief operating officer.

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ANDREW TEIXEIRA (47) BANUS VAN DER WALT (64) TSHIAMO VILAKAZI (50)Executive director Independent non-executive

directorIndependent non-executive director

BSC QUANTITY SURVEYING B ECON, ADVANCED EXECUTIVE PROGRAMME

BA(SW), LLB, CERTIFICATE IN MINING PROSPECTING (SA)

DATE OF APPOINTMENT: FEB 2014 DATE OF APPOINTMENT: APR 2014 DATE OF APPOINTMENT: APR 2014Andrew started his career in his own construction company. He then joined JHI Real Estate in 1993 in their property management division. He was appointed as the director responsible for property management nationally in 2002.

Andrew served as a director of Diversified and was the managing director of PFM prior to the Pangbourne merger.

Banus is a retired property practitioner. Banus was previously the managing director of Sanlam Properties and Gensec Property Services for 16 years. Banus has 40 years’ property experience with the Sanlam Group and has travelled extensively to study the property industry, both locally and internationally.

Banus is a past president of the South African Property Owners Association (SAPOA) and has been a non-executive director of Martprop, Acucap, SA Retail, Vukile and iFour. He was also involved in the listing of Primegro, Acucap, Resilient, iFour, SA Retail, MICC and Vukile. He is currently a member of the Property Committee of Sanlam and a non-executive director of three non-listed companies.

Tshiamo is a practising attorney,

conveyancer and notary public and

the founding member of Vilakazi

Commercial Attorneys. Her firm

specialises in registration of commercial

bonds, notarial registration of personal

habitation servitudes in respect of “family

titles” in former urban black townships

situated in Gauteng Province. She is a

legal consultant to Gauteng Provincial

Government and Department of Housing

and has been in practice for 21 years.

[ [ [] ] ]

DirectorsB O A R D O F(continued)

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FAREED WANIA (41) TRURMAN ZUMA (45)Executive director Independent non-executive

director

CTA, CA(SA)

DATE OF APPOINTMENT: SEP 2014 DATE OF APPOINTMENT: APR 2014Fareed started his property career with

RMP Properties in 1996. He subsequently

joined the JHI Real Estate Group Limited

where he was involved in their property

management division as a portfolio

manager. Fareed was instrumental in the

setup, opening and running of the JHI

Lesotho office.

In 2004 he joined the Pangbourne group

as a senior asset manager reporting to the

managing director. After the merger with

Pangbourne, Fareed has been employed

as an asset manager.

Trurman first worked as an equity analyst

for Old Mutual, focusing on large cap

counters in food, pharmaceuticals, retail

and leisure. After three years he moved

to Standard Bank, Johannesburg, working

as a Private Equity deal-maker before

taking the post of Unit Trust Single

Manager Head at Stanlib Investments

Limited for two years. During his time

at Stanlib, Trurman was awarded a

scholarship to study at Harvard Business

School. He completed his Programme for

Management Development in 2004. In

May 2006, he opted to leave the corporate

environment. He purchased a stake in

South Africa’s largest accounts receivable

management company, MBD, where he

had the position of strategic director.

He also has interests in commodity and

energy-related businesses and he sits on

the board of governors at Hilton College.

He was the chief executive officer of

Advisory Services at Momentum Wealth,

part of the Momentum Group.

After leaving Momentum, Trurman joined

the Absa Group to head up their new

division Global Investments and Solutions

(“GI&S”). GI&S is responsible for all product

that passes through Absa advisers and is

responsible for ensuring seamless access

of Barclays product and toolsets into

South Africa and the African continent.

During the second half of 2014, Trurman

resigned from the Barclays Africa Group to

further his entrepreneurial interests.

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ATTENDANCE AT BOARD AND SUB-COMMITTEE MEETINGS**

Director BoardInvestmentcommittee

Audit committee

Risk committee

Nominationcommittee

Social and ethics

committeeRemuneration

committee

Iraj Abedian (chairman of the board and the nomination committee) ^ 2/3 1/1

Barry Stuhler &@* 3/3 2/2 1/1 1/1

Rual Bornman 3/3

Andries de Lange 2/2

David Lewis 3/3

Protas Phili (chairman of the audit committee) #$* 3/3 2/2 1/1 1/1

Jan Potgieter ^&# 3/3 1/2 2/2 1/1

Willy Ross 2/2

Andrew Teixeira &$ 3/3 2/2 1/1

Banus van der Walt (chairman of the investment committee) &@ 3/3 2/2 1/1

Tshiamo Vilakazi (chairman of the social and ethics and the risk committees) @$^ 3/3 1/1 1/1 1/1

Fareed Wania 2/3

Trurman Zuma (chairman of the remuneration committee) *&# 3/3 2/2 1/2 1/1

^ Member of the nomination committee.& Member of the investment committee.@ Member of the social and ethics committee.$ Member of the risk committee.# Member of the audit committee.* Member of the remuneration committee.

** Note that this reflects the attendance of the directors at meetings of Capital Property Fund Limited (excluding Capital Trust).

CHANGES TO THE BOARD OF DIRECTORSOn 17 September 2014, Willy Ross retired from the board, Andries de Lange resigned from the board and Fareed Wania was appointed as an

executive director. Iraj Abedian was appointed as the chairman of the board on 17 September 2014.

(continued)

DirectorsB O A R D O F

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BENEFICIAL SHAREHOLDING OF DIRECTORS AND OFFICERS IN CAPITAL PROPERTY FUND LIMITED

At 31 December 2014 Direct holding Indirect holding Total shares heldPercentage of shares issued

Iraj Abedian 20 000 - 20 000 -

Rual Bornman - 1 900 000 1 900 000 0,1%

David Lewis - 2 000 000 2 000 000 0,1%

Barry Stuhler 1 624 927 15 626 923 17 251 850 1,0%

Andrew Teixeira - 6 980 858 6 980 858 0,4%

Fareed Wania 1 038 000 - 1 038 000 0,1%

Banus van der Walt 72 368 - 72 368 -

2 755 295 26 507 781 29 263 076 1,7%

BENEFICIAL UNITHOLDING OF DIRECTORS AND OFFICERS IN CAPITAL TRUST*

At 31 December 2013 Direct holdingIndirect holding Total units held

Percentage of units issued

Iraj Abedian 20 000 - 20 000 -

Rual Bornman - 1 900 000 1 900 000 0,1%

Andries de Lange 3 398 660 4 490 651 7 889 311 0,5%

David Lewis - 2 000 000 2 000 000 0,1%

Inge Pick 623 800 - 623 800 -

Barry Stuhler 1 624 927 15 565 642 17 190 569 1,1%

Andrew Teixeira - 6 807 730 6 807 730 0,4%

Fareed Wania 1 038 000 - 1 038 000 0,1%

Banus van der Walt 72 368 - 72 368 -

6 777 755 30 764 023 37 541 778 2,3% * Included for information purposes.

The shareholding of directors and officers has not changed between the end of the financial year and one month prior to the date of the notice of

the AGM other than as disclosed below.

On 20 February 2015, directors and officers accepted the following shares through the Capital share incentive scheme:

Rual Bornman: 1 000 000 indirectly through Rumae Holdings Proprietary Limited.

David Lewis: 1 000 000 indirectly through Wild Break 250 Proprietary Limited.

Barry Stuhler: 1 500 000 indirectly through K2014070733 Proprietary Limited.

Andrew Teixeira: 1 250 000 indirectly through Jean Avenue Investments Proprietary Limited.

Fareed Wania: 500 000 directly.

Jonathan Bigham: 250 000 directly.

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Co-owners

CommunitiesGovernmentLocal municipalitiesRegulatory bodiesIndustry organisations

Capital is pleased to present its first integrated report to stakeholders, for the 2014 financial year, in accordance with the King Report on Governance for South Africa (“King III”) after the internalisation of PFM and Capital Trust’s conversion to a corporate REIT. The integrated report has been prepared to give stakeholders insight into Capital’s business model, performance, governance framework, strategy, risks and opportunities. While Capital have attempted to include information relevant to all stakeholders, the integrated report has been primarily prepared for the providers of financial capital in accordance with the International Integrated Reporting Framework (the “Framework”) issued in December 2013. The information in this integrated report has been prepared using methods consistent with prior years and contains comparable information.

Capital is a corporate REIT listed on the JSE Limited that, through its wholly owned subsidiaries, owns a portfolio of logistics, industrial, office and retail properties as well as a portfolio of listed property securities.

The information included in the integrated report has been prepared in accordance with International Financial Reporting Standards (“IFRS”), the requirements of the Companies Act of South Africa, 2008 (“the Companies Act”), the JSE Listings Requirements and King III. Capital is working towards complying fully with the Framework and has made additional disclosures as a step towards its compliance.

This integrated report covers the financial and non-financial performance of operating subsidiaries over whose operating policies and practices Capital exercises control or significant influence, as denoted in note 8 to the financial statements on page 62. Capital has operations in South Africa.

In determining materiality when preparing the 2014 integrated report Capital applied the definition as per the Framework as: “Information about matters that substantively affect the group’s ability to create value over the short, medium and long term.” All items identified as being material by the board have been disclosed in this report.

ORGANISATIONAL STAKEHOLDERSECONOMIC STAKEHOLDERS

SOCIETAL STAKEHOLDERS

ReportS C O P E O F T H E

TenantsSuppliersProperty managersFinanciersInvestors CAPITAL

PROPERTY FUND LIMITED

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Business ModelS T R A T E G Y A N D

SHAREHOLDERSCapital strives to deliver both capital and distribution growth to its shareholders. In doing so, Capital undertakes to manage its assets in a responsible manner.

The performance of Capital’s shares against the JSAPY index is shown on page 21 of this integrated report.

TENANTSThe management team fosters long-term relationships with our tenants, recognising that there is an important symbiotic relationship between their success and ours.

The tenant profile can be found on page 39 and the lease expiry profile on pages 40 and 41 of this report.

PROPERTIESThe day to day management of the properties is outsourced to our managing agents, namely JHI Properties Proprietary Limited, Broll Property Management Proprietary Limited, Braamcor Management Services Proprietary Limited, Promprops CC t/a Prominent Properties and Panross Properties Proprietary Limited. Capital also has a team of experienced and dedicated in-house asset managers who are responsible for overseeing the properties, the performance of the properties and managing tenant relationships. These asset managers report directly to the executive committee.

We are constantly assessing opportunities for redevelopments of our properties and assessing whether the properties in the portfolio meet our strategic objectives of growth in capital value and income, sectoral spread weighted towards logistics and location in areas consistent with the group’s objectives. The graphs indicating the geographic and sectorial spread of the portfolio are on page 39. The growth in property value is indicated in the fair value gain on investment property line in the statement of comprehensive income.

INVESTMENTSOur management team is constantly investigating potential investments that will provide sustainable, long-term growth that exceeds industry norms whether in the form of a potential development, purchase of an income generating property or through investment in listed property equities.

A stringent approval process is in place for properties to be acquired or developed. The investment committee, who are all experienced in the property sector, approve Capital’s acquisitions, developments, re-developments and disposals and receive regular updates on these at each meeting.

MANAGING INTEREST RATE AND CURRENCY RISKCapital’s ability to access funding is intrinsic to its operations and hence its ability to create value. Diversity of funding is maintained through facilities from several large, well rated South African banks and via the debt capital markets through Capital’s Domestic Medium Term Note (DMTN) programme.

Capital manages its financing costs through the diversity of funding sources and through hedging its exposure to interest rate risk through the use of interest rate derivatives. It is the policy to maintain interest rate hedges of at least 80% of borrowings. Details of the interest rate derivatives used and the group’s facilities are shown on page 15 and in note 13 to the financial statements. Capital utilises cross currency swaps to hedge its currency exposure. It is the policy to maintain cross currency swaps up to a maximum of 50% of its exposure.

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NATURE OF THE BUSINESSCapital Trust was listed in 1984 as a property unit trust, originally under the Unit Trust Control Act, 1981, and later as a collective investment scheme in property (“CISIP”). Capital Trust was approved as a REIT with effect from 1 January 2014. Capital Trust did not benefit from all the advantages of REIT legislation as its assets were effectively still owned by a CISIP rather than a company. In terms of CISIP legislation, Capital Trust also required an external asset management company, PFM, which is not considered global best practice. On 5 April 2013, the boards of Resilient and PFM recommended the internalisation of PFM and Capital Trust’s conversion to a corporate REIT. Following a lengthy process involving approvals by the FSB as regulator, the JSE Limited, First National Bank as trustee and the Capital Trust unitholders, Capital Trust became a corporate REIT, Capital, on 30 June 2014. Resilient disposed of all of the shares it held in PFM to Capital in exchange for 70 754 717 Capital shares enabling Capital to internalise its asset management. The group’s consolidated results reflect the combined position of Capital Trust (1 January 2014 to 30 June 2014) and Capital (1 July 2014 to 31 December 2014).

The management fee for PFM was calculated at 0,4% of market capitalisation plus debt. With the strong performance in Capital’s share price, the internalisation of PFM has already resulted in significant savings for Capital.

The company owns the largest A-grade logistics portfolio in South Africa. Its investment portfolio also includes A and B-grade offices, a small portfolio of retail properties and a portfolio of listed securities.

DISTRIBUTABLE EARNINGSCapital’s distribution increased by 10,34% to 83,44 cents per share for the year ended 31 December 2014. The dividend for the final six months of the financial year is 44,22 cents per share, an increase of 10,44% over the previous comparable period.

STRATEGYCapital’s strategy is to invest in and develop A-grade logistics facilities and premium grade offices in the major metropolitan areas in South Africa and to invest up to 30% of the gross asset value in offshore equities. These include New Europe Property Investments plc (“Nepi”) and Rockcastle Global Real Estate Company Limited (“Rockcastle”).

ReportD I R E C T O R S ’

The company continues to increase its exposure to developments in logistics parks by securing suitable land for this purpose. The development pipeline will be funded through a combination of debt and the sale of non-core properties.

REVIEWCapital has been successful in letting all of its 100%-owned new developments and redevelopments during the year. Furthermore, it has also pre-let all logistics facilities to be completed in the next six months, which bodes well for the proposed pipeline. Management expects to begin the development of Clairwood Logistics Park in Durban during the course of 2015. All matters raised by the local municipality, as well as other stakeholders, have been addressed.

The core property portfolio produced robust net income growth of 6,1% compared with the net income for the 2013 financial year. Demand for A-grade logistics facilities remains firm, however, this portfolio’s growth was limited to growth of 5,6% as a result of a significant number of large leases expiring and being renegotiated. The office portfolio now constitutes 16,0% of gross assets. Although income growth of 7,7% was achieved, this sector remains challenging. Office vacancies increased to 11,6% as a result of two large tenants downscaling in November and December 2014. Income from the retail portfolio (7,1% of gross assets) grew by 7,3%.

Capital benefitted from the strong performance of its local and offshore listed holdings. These investments have become a significant component of Capital’s gross assets, and now account for 34,1% of the overall portfolio based on market value.

BROAD BASED BLACK ECONOMIC EMPOWERMENTOn 6 October 2014 and as approved in the general meeting, 83 333 333 shares were issued to The Siyakha Education Trust at R12,00 per share. The sole purpose of The Siyakha Education Trust is the promotion of black education.

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ACQUISITIONS AND DEVELOPMENTSThe following developments were completed during the financial year:

Description % owned 100% GLA Yield Completion

Raceway Industrial Park 100% 40 796m2 9,4% Jul 2014

Montague Business Park 25% 19 840m2 8,5% Aug 2014

N1 Business Park 20% 12 584m2 10,0% Mar 2014

N1 Business Park 20% 10 593m2 10,0% Jun 2014

Noursepack Epping 2 100% 11 200m2 8,0% Jul 2014

14 Fitzmaurice Ave Epping 2 100% 16 200m2 8,0% Jul 2014

The following new developments have commenced:

Description % owned 100% GLA Estimated yieldEstimated

completion

Linbro Park 100% 31 155m2 9,0% Jul 2015

Linbro Park 100% 27 025m2 9,0% May 2015

Rivergate Cape Town 100% 18 214m2 8,0% Oct 2015

Pomona 100% 21 051m2 9,0% Sep 2015

Montague Business Park 25% 14 000m2 8,0% Apr 2015

N1 Business Park 20% 8 031m2 9,5% Mar 2015

Land held for future developments:

Description % owned 100% GLA Intended useEstimated

commencement

Clairwood Logistics Park 100% 358 000m2 Logistics *

Montague Business Park 25% 124 151m2 Logistics **

Sandton Offices 80% 60 000m2 Offices **

Tradeport City Deep 100% 55 000m2 Logistics **

Westlake 100% 35 000m2 Logistics Apr 2015

Louwlardia 100% 8 600m2 Logistics Apr 2015

N1 Business Park 20% 12 700m2 Logistics Jan 2015

* Timing subject to zoning.** Subject to being tenanted.

REDEVELOPMENTSCapital is extensively redeveloping 17 680m2 of the existing 27 312m2 at 60 Electron Avenue Isando. The property has been let to a national tenant for 7 years and is anticipated to yield 8,0% with completion scheduled for June 2015.

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DISPOSALSThe following properties were sold during the 2014 financial year:

Property nameSales proceeds

R’000

Valuation at Dec 2013

R’000 Exit yield Effective date

13 Trafford Road Pinetown 42 000 43 500 9,4% 22 Sep 2014

4th Street Wynberg^ 53 500 49 200 9,5% Transfer date

^ Held for sale at 31 December 2014.

Apart from a small sub-division of Surprise Park, all properties held for sale at 31 December 2013 were transferred.

VACANCIES AND ARREARSTotal vacancies increased to 4,5% compared to 4,2% at 30 June 2014. Logistics vacancies increased from 3,2% at 30 June 2014 to 3,3% at 31 December 2014, industrial vacancies decreased from 9,3% at 30 June 2014 to 4,8% at 31 December 2014. Office vacancies increased to 11,6% from 8,2% at 30 June 2014 and retail vacancies decreased from 4,3% at 30 June 2014 to 4,1% at 31 December 2014.

There was no material change in arrears and bad debts are well provided for.

EQUITY INVESTMENTSDec 2014 Dec 2013

Number of shares

Market value R’000

Number of shares

Market value R’000

Rockcastle Global Real Estate Company Limited* 164 665 305 3 984 900 121 705 087 1 703 871

New Europe Property Investments plc 24 190 000 2 757 660 16 024 304 1 297 969

Resilient Property Income Fund Limited 17 350 000** 1 457 227 16 200 000 899 100

Fortress Income Fund Limited B 107 070 000** 1 875 866 96 000 000 878 400

Fortress Income Fund Limited A - - 23 200 000 341 040

Ascension Properties Limited A - - 42 750 000 190 238

Ascension Properties Limited B - - 45 600 000 114 000

Delta Property Fund Limited - - 8 204 677 70 971

Tower Property Fund Limited - - 4 021 474 32 976

10 075 653 5 528 565

* Rockcastle was treated as an associate (equity accounted) and was thus not fair valued in the financial statements at 31 December 2014.

** Capital followed its rights in terms of rights issues.

FUNDINGCapital restructured its RMB facilities resulting in an extension of the debt maturity profile together with a small reduction in margin. Capital increased debt from commercial banks as it became more difficult to raise debt from debt capital markets. An additional R400 million was raised from RMB whilst an additional R300 million was raised from Standard Bank.

At 31 December 2014 the all-in weighted average cost of funding was 8,36%, the average hedge term was 5,5 years and 82,8% of net borrowings, excluding future commitments, was hedged.

Capital hedged 33,1% of its foreign currency capital exposure by utilising cross currency swaps.

ReportD I R E C T O R S ’(continued)

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SUMMARY OF FINANCIAL PERFORMANCE

Dec 2014 Jun 2014 Dec 2013 Jun 2013

Dividend/distribution per share/unit (cents) 44,22 39,22 40,04 35,58

Shares/units in issue 1 761 074 329 1 677 740 996 1 606 986 279 1 606 986 279

Net asset value R11,56 R10,49* R10,71* R9,65*

Interest-bearing debt to asset ratio** 24,8% 23,6% 20,8% 21,3%

* In order for NAV to be comparable with the Dec 2014 NAV, the comparatives were adjusted to include the distribution previously accounted for as a current liability at period end in equity.

** The interest-bearing debt to asset ratio is calculated by dividing interest-bearing borrowings by total assets.

The company’s use of distribution per share/unit as a relevant measure of results for trading statement purposes remains unchanged from prior periods.

FACILITIES

ExpiryFacility

R’ millionAverage margin

over Jibar

2015 1 312 1,22%

2016 - -

2017 2 712 1,48%

2018 1 270 1,62%

2019 1 550 1,52%

2020 750 1,71%

7 594 1,49%

The overall cost of borowings at 31 December 2014 was 8.36%.

INTEREST RATE DERIVATIVES

Interest rate swap expiry

R’ millionAverage

swap rate

2016 200 7,50%

2017 700 7,22%

2018 500 7,12%

2019 600 6,40%

2020 600 7,43%

2021 600 8,02%

2022 400 7,98%

2023 200 7,47%

2024 100 7,78%

Total 3 900 7,36%

Interest rate CAP expiry R’ millionAverage CAP rate

2019 200 7,39%

2021 200 7,33%

2022 200 7,46%

2023 400 7,98%

Total 1 000 7,63%

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STATEMENT OF COMPREHENSIVE INCOME BREAKDOWN

Income

Year ended Dec 2014

R’000

Year ended Dec 2013

R’000

Contractual rental income 1 624 383 1 604 429

Recovery - other 30 411 29 654

Electricity net of recoveries 13 902 17 635

Municipal charges net of recoveries (70 180) (60 547)

Property management fee (49 898) (50 208)

Letting commission (25 537) (24 843)

Tenant installation costs (27 398) (25 206)

Other expenses (143 141) (144 782)

Net rental and related revenue 1 352 542 1 346 132

RECONCILIATION BETWEEN STATEMENT OF COMPREHENSIVE INCOME AND DIVIDEND DECLARED

Dec 2014R’000

Recoveries and contractual rental revenue 2 070 701

Property operating expenses (718 159)

Income from investments 197 413

Dividends accrued 21 684

Administrative expenses (68 512)

Distributable income from associate 118 267

Interest received 127 700

Interest on shares issued to Resilient - internalisation of PFM 27 750

Interest on shares issued cum distribution 19 640

Interest paid on borrowings (472 660)

Capitalised interest 112 933

Distributable income 1 436 757Less: distribution declared 30 June 2014 (658 010)

Dividend declared 778 747

OUTLOOKThe quality of Capital’s portfolio places it in a position to achieve solid growth even in the challenging South African economic environment. Capital should continue to benefit from strong growth in its listed securities.

Based on forecast exchange rates of R11,20 to the US Dollar and R12,80 to the Euro, the board anticipates that Capital will achieve growth in dividends of approximately 9% for the 2015 financial year. This forecast has not been reviewed or reported on by Capital’s auditors.

The forecast is based on the assumption that a stable macro-economic environment will prevail, no major corporate failures will occur and that tenants will be able to absorb the recovery of rising utility costs and rates and taxes. Budgeted rental income was based on contractual escalations and anticipated market related renewals and re-lets.

ReportD I R E C T O R S ’(continued)

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Capital’s remuneration committee oversees the development and annual review of the remuneration policy which is ultimately approved by the board. The remuneration committee has been mandated by the board to authorise the remuneration and incentivisation of all employees, including executive directors. The remuneration committee members are Trurman Zuma (chairman), Protas Phili and Barry Stuhler.

The remuneration policy (detailed on pages 100 to 102) is aligned with the strategic objectives of the company which is to create long-term, sustainable value for stakeholders. Remuneration is a combination of salary, short-term incentivisation and long-term incentivisation in order to attract and retain motivated, high-calibre executives and employees whose interests are aligned with the interests of shareholders.

EMPLOYEES AND EXECUTIVE DIRECTORS’ REMUNERATIONSalaries are competitive relative to the market and increases are determined with reference to individual performance, inflation and market-related factors on a total cost-to-company basis. Annual increases are effective 1 January. Executive directors do not receive directors’ or sub-committee fees. There is no retirement fund for employees or executive directors. Executive directors have service contracts with Capital which include a notice period. There is no restraint of trade.

Bonuses based on individual and group performance are an effective means of short-term incentivisation. These are awarded based on the performance of the individual and the group taking into account market conditions. Bonuses are approved by the remuneration committee.

The long-term incentivisation aligns to the company’s strategic objective of promoting sustainable growth in distribution. Long-term incentivisation is achieved through the allocation of shares to employees through The Capital Share Purchase Scheme. The remuneration committee authorises the number of shares to be allocated based on individual employee performance as recommended by management. The remuneration committee takes into consideration the individual’s salary, position and previous share allocations. Capital issues shares to the Capital Share Purchase Scheme. On acceptance of the shares by the individual, the Capital Share Purchase Scheme provides loan financing to acquire the shares. Further details of loans made to employees in terms of the Capital Share Purchase Scheme can be found in note 6 to the financial statements on page 62.

The executive directors and employees were previously remunerated by Resilient Properties Proprietary Limited. Subsequent to the internalisation on 30 June 2014, executive directors and employees are remunerated by Capital Propfund Proprietary Limited, a wholly owned subsidiary of Capital.

Remuneration(paid by subsidiaries in

the group) for the six months ended

Dec 2014R’000

Bonus(paid by subsidiaries in

the group) for the six months ended

Dec 2014R’000

Rual Bornman 1 119 251

Andries de Lange 1 68 8

David Lewis 940 126

Barry Stuhler 1 854 192

Andrew Teixeira 1 444 291

Fareed Wania 2 361 33

5 786 901

1 Andries de Lange resigned from the board on 17 September 2014.2 Fareed Wania was appointed to the board as an executive director from 17 September 2014.

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(continued)

NON-EXECUTIVE DIRECTORS REMUNERATIONNon-executive directors’ remuneration consists of a base fee and a fee per board sub-committee membership which are reviewed annually. The remuneration committee recommends directors’ fees payable to non-executive directors to the board which proposes the fees for shareholder approval at the annual general meeting. Attendance of directors at the various board and sub-committee meetings is disclosed on page 8.

Non-executive directors do not participate in the Capital Share Purchase Scheme nor is there any other remuneration paid to non-executive directors, including remuneration linked to the performance of the group.

For services as a director(paid by the company)

for the six months ended Dec 2014

R’000

Iraj Abedian2 (chairman of the board and the nomination committee) & 167

Protas Phili (chairman of the audit committee) $@ ^ 238

Jan Potgieter3 $#& 238

Willy Ross1 70

Tshiamo Vilakazi (chairman of the risk and social and ethics committees) &^% 188

Banus van der Walt (chairman of the investment committee) #% 188

Trurman Zuma (chairman of the remuneration committee) $#@ 263

1 352

1 Willy Ross retired from the board on 17 September 2014.2 Iraj Abedian was appointed as chairman of the board on 17 September 2014.3 Jan Potgieter was appointed to the board on 27 January 2014.

$ Member of the audit committee^ Member of the risk committee# Member of the investment committee@ Member of the remuneration committee& Member of the nomination committee% Member of the social and ethics committee

The group did not pay any fees or benefits to directors other than the remuneration as disclosed in the tables above.

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ShareholdersA N A L Y S I S O F

SHAREHOLDERS SPREAD AT 31 DECEMBER 2014 AS DEFINED IN TERMS OF THE LISTINGS REQUIREMENTS OF THE JSE LIMITED:

Number of shareholders

Number of shares held

Percentage of issued shares

Public 12 427 1 511 291 866 85.8%

Non-public 1 195 900 000 11.1%

Directors and employees 81 53 882 463 3.1%

12 509 1 761 074 329 100.0%

Size of holdingNumber of

shareholdersNumber of

shares heldPercentage of issued shares

up to 2 500 shares 2 654 2 815 004 0.2%

2 501 to 10 000 shares 4 574 27 040 088 1.5%

10 001 to 100 000 shares 4 422 131 042 275 7.4%

100 001 to 1 000 000 shares 689 217 038 405 12.3%

1 000 001 to 3 500 000 shares 91 172 355 688 9.8%

More than 3 500 000 shares 79 1 210 782 869 68.8%

12 509 1 761 074 329 100.0%

Registered shareholders owning 5% or more of issued shares Number of

shares heldPercentage of issued shares

Resilient 195 900 000 11.1%

Government Employees Pension Fund 139 804 326 7.9%

335 704 326 19.0%

Control of more than 5% of issued shares Number of

shares controlledPercentage of issued shares

Resilient 195 900 000 11.1%

Government Employees Pension Fund 139 804 326 7.9%

STANLIB 117 191 345 6.7%

Investec 97 510 747 5.5%

550 406 418 31.2%

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20

N1 Business Park 87 216 m2 Gauteng

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Average daily value traded R’million

2009 8,6

2010 6,2

2011 14,9

2012 18,6

2013 25,0

2014 25,4

Average daily volume traded (‘000)

2009 1 379,2

2010 830,1

2011 1 792,5

2012 1 891,5

2013 2 351,0

2014 2 100,5

Closing price Cents

2009 710

2010 821

2011 881

2012 1 070

2013 1 065

2014 1 328

PerformanceS H A R E P R I C E

Dec 2007

Jun 2008

Dec 2008

Jun 2009

Dec 2009

Jun 2010

Dec 2010

Jun 2011

Dec 2011

Jun 2012

Dec 2012

Jun 2013

Dec 2013

Jun 2014

Dec 2014

250

230

210

190

170

150

130

110

90

%

Capi

tal v

s SA

PY In

dex

(inde

xes

to 1

00 o

n 31

Dec

embe

r 200

7)

70

50

Indexed CPL Indexed SAPY

REITPUT

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22

FactorsK E Y R I S K

Risk is the volatility of unexpected outcomes. Within the Capital framework, this would specifically relate to the adverse impact on the value of its assets, equity or earnings. Risk management is the discipline by which these risks are identified, assessed and mitigation strategisation prioritised. It is essential to understand the multiple dimension of risk in order to manage it effectively with the aim of increasing shareholder value and gaining a competitive advantage.

Risk management is essential for improved performance, growth and sustainable value creation. The process for identifying and managing risks has been set by the board. The board of directors has overall responsibility for risk management but has delegated the responsibility for monitoring risk management processes and activities to Capital’s risk committee. The day-to-day responsibility for risk management, including maintaining an appropriate internal control framework, remains the responsibility of Capital’s executive management.

Risk management is an integral part of the group’s strategic management and is the mechanism through which risks associated with the group’s activities are addressed.

The key objectives of the risk management system include:

• the identification, assessment and mitigation of risks on a timely basis;

• t he provision of timely information on risk situations and appropriate risk responses;

• the identification of potential opportunities which would result in increasing company value; and

• the instillation of a culture of risk management throughout the Capital group.

Risks are monitored via the risk management framework in terms of which management identifies risks, documents these in the risk matrix and assesses the probability of their occurrence as well as the potential impact of the risk on the group. Each identified risk is then managed and, where possible, mitigated. Risks are categorised as either financial, operational, market or regulatory and compliance risks. Due to the dynamic nature of the economic environment in which Capital operates, risks, and the impact thereof, change constantly. Accordingly, risk management is a dynamic and ongoing discipline which is continuously adapted to its environment.

The risk management framework is presented to the risk committee at each risk committee meeting.

Key risk Strategic goal impacted

Business impact Mitigation of the risk

Stakeholders impacted

South Africa is experiencing significant increases in administered prices including electricity, rates and municipal levies.

Tenant relationships and retention

Growth in distribution

Capital is bearing the increased cost of utilities that cannot be recovered from tenants. This reduces distributable income.

Energy saving technologies are being implemented where possible in order to reduce utility costs.

Tenants Property managers Shareholders Co-owners

The ability of tenants to absorb the increasing cost of occupancy is limited.



The increased cost of occupancy may result in more tenant business failures and legal action leading to increased vacancies and increased legal costs and bad debts.

Tenant arrears are closely monitored. Asset managers and property managers meet with tenants on a regular basis in order to mitigate legal action and minimise bad debts.


Local authorities’ service delivery is deteriorating and municipalities are not billing correctly with a large number of local authorities no longer reading electricity or water meters.



Capital is not being billed the correct utility amounts on a monthly basis. Utilities recovered from tenants are based on inaccurate billings.

Capital has installed its own meters and employed third party meter readers. Recoveries from tenants are based on this information rather than billing received from local authorities. This data ensures that Capital is billed correctly and in turn accurately recovers utility charges from tenants.


Letting of vacant space is challenging in the current economic climate.



Vacant space reduces rental income and expenses are incurred regardless of whether the property is tenanted. This results in less distributable income.

Asset managers and property managers meet with tenants on a regular basis to ensure that their concerns are addressed. Rentals are offered at market related rates and incentives are offered to brokers in order to let the vacancies. Buildings are well maintained.


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Deterioration in the company’s credit profile or a decline in debt market conditions.

Management of finance costs


The cost of financing increases substantially reducing distributable income.

The group monitors its key financial ratios and seeks to maintain a strong investment grade credit rating.

Financiers Shareholders Employees

A general rise in interest rates could impact the cost and availability of borrowings.



The cost of financing increases substantially reducing distributable income.

Interest rate risk is mitigated through the use of interest rate swaps and caps.


The underperformance of property managers may result in inaccurate recovery of revenue and incorrect reporting.



Inaccurate billing of tenants and reporting.

Compliance with service level agreements is monitored regularly. Management reviews monthly reports and meets with the property managers on a regular basis.


Inability to refinance debt at acceptable rates and over-exposure to single finance institution.



Higher finance costs result in lower distributable income.

Concentration exposure to one financial institution is avoided. Capital has implemented a DMTN programme which assists in reducing concentration risk.


Business continuity risk. Growth in distribution

Business interruption may have a severe impact on the operations of the company and may reduce distributable income.

Capital has a business continuity plan which includes the daily backup of data which is tested regularly. The majority of property management functions are outsourced to third parties.

Shareholders Employees Property managers

Retention of key staff. Tenant relationships and retention

Skilled and experienced staff may not be retained.

Key staff are remunerated through the incentivisation scheme as well as through ad hoc bonuses.

Shareholders Employees

Significant volume of leases expiring in a specific period.



Rental income may be eroded due to new leases or renewals at lower rentals than previously achieved.

Asset and property managers closely monitor lease expiries and begin negotiations with tenants in advance of the expiry. All rentals are done at market related rates.


Destruction of assets. Maintaining and growing a quality portfolio of assets


Buildings destroyed due to force majeure, fire etc and as a result income cannot be generated from tenants.

Insurance cover is carefully monitored to ensure that it is sufficient. The insurable amount is based on replacement valuations obtained from an independent valuer. Capital also has loss of income insurance for the estimated period of reconstruction. Capital uses reputable underwriters with sufficient financial backing to sustain the cover paid for.

Tenants Property managers Shareholders Employees Co-owners

Physical deterioration of properties rendering them untenantable.

Maintaining and growing a quality portfolio of assets


Properties that are physically deteriorated will be untenantable and resulting in decreased distributable earnings.

Asset managers perform regular property inspections as do the property managers.


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Risk that the nodes in which properties are located are deteriorating.



Properties with good fundamentals may be located in deteriorating nodes resulting in an erosion of rental income or difficulty in finding tenants.

The asset managers constantly monitor the properties and the areas in which they are located under their mandate. Properties in such areas are carefully assessed as to whether they should be sold or re-developed.


The risks associated with developing a property include the construction risk (materials risk, contractor insolvency, professional design risks and structural risk), tenant risk (if occupation is not handed over in time, penalties or lease cancellation could occur), design and market risk (the property fails due to location or design) and feasability risk (the project costs more than projected resulting in lower returns or low profitability).



Developed properties may yield lower than budgeted due to cost overruns or may be of inferior quality either due to location or design. Achievable rentals would be lower than those budgeted resulting in lower distributable income.

Capital has a dedicated project management team that monitors all construction risks and spend with project managers allocated to each development. All construction works are put to tender and only reputable professionals are engaged. Structural and occupation certificates are obtained for all developments on completion.


Risk of financial loss on investments in Nepi and Rockcastle due to currency fluctuations.


Fluctuation in the currency may result in lower distributable income due to the impact on the distributions received on the investments. Additionally, net asset value may decrease due to currency fluctuations impacting the value of the investments.

The investments in Nepi and Rockcastle are considered to be long term. The income derived from these investments are based in Euros and US dollars respectively as are the investments.

Shareholders

Non-compliance with REIT requirements.


If Capital no longer qualifies as a REIT in terms of the JSE Listings Requirements and the Income Tax Act, it will incur tax liabilities.

Management monitors compliance with the REIT requirements on an ongoing basis. External consultants are used as an independent check to ensure that the requirements of the REIT legislation are met.

Shareholders Financiers

Non-compliance with laws and regulations.


Due to South Africa’s dynamic legislative environment and the volume of new legislation being passed, particularly in respect of environmental laws and social responsibility, Capital is exposed to greater risks of non-compliance which may result in reputational damage and financial penalties.

Capital engages both in-house and external legal advisors. Training is provided where relevant new legislation is introduced. Management and the auditors monitor compliance with the legal requirements. Capital is a member of various industry organisations. The group's employees regularly attend conferences and training specific to their area of responsibility within the group which would assist in the identification of new and relevant legislation.

Shareholders Employees Co-owners

FactorsK E Y R I S K(continued)

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Infrastructure and utility supply interruptions.



South Africa is currently experiencing significant infrastructure issues that have resulted in the disruption in the supply of both water and electricity.

Capital’s new logistics facilities make maximum use of natural lighting so as to avoid the impact of electricity cuts. There are generators at a number of properties. Management continually monitors the issues and investigates a variety of potential solutions.


OPPORTUNITIESThe current economic conditions make it an opportune time for Capital to exploit its land bank by carefully timed speculative developments in areas of strong demand. Building costs are at lower levels than the past few years.

The exposure to offshore investments diversifies Capital’s exposure to various sectors. The growth in some of the markets in which Nepi and Rockcastle invest are higher than growth in the South African economy providing an opportunity for higher returns on investment.

Montague Business Park 63 113 m2 Western Cape

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The board of directors endorse the code of corporate practices and conduct as set out in the King III report and confirms that the group is compliant with the provisions thereof in all material respects. The board has been addressed by independent corporate governance consultants to ensure that all directors are fully conversant with best practice and current thinking with regard to corporate governance.

A register of all 75 King III principles and the extent of Capital’s compliance therewith is available on Capital’s website at www.capitalproperty.co.za.

COMPOSITION OF THE BOARD OF DIRECTORSThe board is comprised of five executive directors and six independent non-executive directors. All directors serve for a maximum period of three years and are subject to retirement by rotation and re-election by members in general meeting. Board appointments are made in terms of the policy on nominations and appointments, as applied by the nomination committee. Such appointments are transparent and subject to final approval by the board.

There are no fixed term contracts for executive directors and the notice period for termination or resignation is one calendar month. There is no restraint of trade period for executive directors.

ROLE OF THE DIRECTORSUltimate control of the company rests with the board of directors while the executive management is responsible for the proper management of the company. To achieve this, the board is responsible for establishing the objectives of the company and setting a philosophy for investments, performance and ethical standards. Although quarterly board meetings are arranged every year, additional meetings are called should circumstances require it. Three board meetings were called during the 2014 financial year for Capital Property Fund Limited.

In 2014, the chairman, with the assistance of the company secretary, led a formal review of the effectiveness of the board and its committees and of the individual directors. Each director completed detailed evaluation questionnaires and an analysis of the findings was presented to the board. There was agreement that the board was operating effectively. The results were positive and action plans were formulated where required.

The sub-committee composition is reviewed on an annual basis.

FUNCTIONS OF THE BOARDThe board acknowledges that it is responsible for ensuring the following functions as set out in the board charter:

• good corporate governance and implementation of the code of corporate practices and conduct as set out in the King III report;

• that the group performs at an acceptable level and that its affairs are conducted in a responsible and professional manner; and

• the board recognises its responsibilities to all stakeholders.

Governance ReviewC O R P O R A T E

RESPONSIBILITIES OF THE BOARDAlthough certain responsibilities are delegated to committees or management executives, the board acknowledges that it is not discharged from its obligations in regard to these matters.

The board acknowledges its responsibilities as set out in the board charter in the following areas:

• the adoption of strategic plans and ensuring that these plans are carried out by management;

• monitoring of the operational performance of the business against predetermined budgets;

• monitoring the performance of management at both operational and executive level;

• ensuring that the group complies with all laws, regulations and codes of business practice;

• ensuring a clear division of responsibilities at board level to ensure a balance of power and authority in terms of group policies.

INDEPENDENCE OF THE DIRECTORSThe board of directors’ independence from the executive management team is ensured by the following:

• separation of the roles of chairman and managing director, with the chairman being independent;

• the board being dominated by independent non-executive directors;

• the audit, investment, nomination, remuneration, social and ethics and risk committees having a majority of independent non-executive directors;

• non-executive directors not holding service contracts;

• all directors having access to the advice and services of the company secretary; and

• with prior agreement from the chairman, all directors are entitled to seek independent professional advice concerning the affairs of the company at the company’s expense.

The following independent non-executive directors chair the various sub-committees of the board:

• Audit Protas Phili • Investment Banus van der Walt • Nomination Iraj Abedian • Remuneration Trurman Zuma • Risk Tshiamo Vilakazi • Social and ethics Tshiamo Vilakazi

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The independence of the non-executive directors was assessed and all non-executive directors are deemed to be independent in terms of the requirements of King III. Independence evaluations are done annually for all non-executive directors.

None of the directors have served for a period of more than nine years.

DIRECTORS’ PERSONAL INTERESTSA full list of directors’ interests is maintained and directors certify that the list is correct at each board meeting.

Directors recuse themselves from any discussion and decision on matters in which they have a material financial interest.

AUDIT COMMITTEEThe primary role of the audit committee is to ensure the integrity of financial reporting and overseeing the audit process. In pursuing these objectives, the audit committee oversees relations with the external auditors. The committee also assists the board in discharging its duties relating to the safeguarding of assets, the operation of adequate systems and internal control processes, overseeing the preparation of accurate financial reports and statements in compliance with all applicable legal requirements and accounting standards, ensuring compliance with good governance practices and nomination of external auditors.

The role of the audit committee has been codified in the audit committee charter which has been approved by the board. This charter is aligned with the requirements of King III and the Companies Act.

The audit committee comprises Protas Phili (chairman) (appointed 3 July 2014), Jan Potgieter (appointed 3 July 2014) and Trurman Zuma (appointed 3 July 2014), all of whom are independent non-executive directors. The managing director, financial director, external auditors and company secretary attend the committee meetings as invitees. The committee members have unlimited access to all information, documents and explanations required in the discharge of their duties, as do the external auditors.

The board, in consultation with the audit committee chairman, makes appointments to the committee to fill vacancies. Members of the audit committee are subject to re-election by shareholders in general meeting on an annual basis. The board has determined that the committee members have the skills and experience necessary to contribute meaningfully to the committee’s deliberations. In addition, the chairman has requisite experience in accounting and financial management.

In fulfilling its responsibility of monitoring the integrity of financial reports to shareholders, the audit committee has reviewed accounting

principles, policies and practices adopted in the preparation of financial information and has reviewed documentation relating to the annual integrated report. The clarity of disclosures included in the financial statements were reviewed by the audit committee, as was the basis for significant estimates and judgements.

It is the function of the committee to review and make recommendations to the board regarding interim financial results and the integrated report prior to approval by the board.

EXTERNAL AUDITA key factor that may impair auditors’ independence is a lack of control over non-audit services provided by the external auditors. In essence, the external auditors’ independence is deemed to be impaired if the auditors provide a service which:

• results in auditing of own work by the auditors;

• results in the auditors acting as a manager or employee of the group;

• puts the auditors in the role of advocate for the group; or

• creates a mutuality of interest between the auditors and the group.

Capital addresses this issue through three primary measures, namely:

• disclosure of the extent and nature of non-audit services;

• the prohibition of selected services; and

• prior approval by the audit committee of non-audit services.

Other safeguards encapsulated in the policy include:

• the external auditors are required to assess periodically, in their professional judgement, whether they are independent of the group;

• the audit committee ensures that the scope of the auditors’ work is sufficient and that the auditors are fairly remunerated; and

• the audit committee has primary responsibility for making recommendations to the board on the appointment, re-appointment and removal of the external auditors.

The audit committee reviews audit plans for external audits and the outcome of the work performed in executing these plans. They further ensure that items identified for action are followed up. The external auditors report annually to the audit committee to confirm that they are and have remained independent from the group during the year.

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Governance ReviewC O R P O R A T E(continued)

INTERNAL AUDITThe company does not have a formalised internal audit department. This is primarily due to the fact that the majority of the property management functions have been outsourced to external property managers who are subjected to annual external audits. The audit committee continually examines the appropriateness of utilising independent internal auditors to periodically review activities of the company and service providers.

The asset management function of Capital Trust was outsourced to Resilient for the first six months of the 2014 financial year. During 2014, Resilient engaged Grant Thornton to perform reviews on controls over specific key areas. The company will consider the appropriateness of appointing an independent internal auditor for the 2015 financial year.

ETHICAL PERFORMANCEThe board of directors forms the core of the values and ethics subscribed to by the company through its various committees. These values and ethics are sustained by the directors’ standing and reputation in the business community and their belief in free and fair dealings in utmost good faith and respect for laws and regulations. The company has a code of ethics communicated to all staff. The code of ethics stipulates, among other things, that all stakeholders are expected to act in good faith, that bribery in any form is not tolerated, all conflicts of interest need to be declared and that compliance with all legislation is of utmost importance. The code of ethics is reviewed by the social and ethics committee on an annual basis.

The board is not aware of any transgressions of the code of ethics during the year.

No issues of non-compliance, fines or prosecutions have been levied against the company.

INTERNAL FINANCIAL AND OPERATING CONTROLSA framework of financial reporting, internal and operating controls has been established by the board to ensure reasonable assurance as to accurate and timeous reporting of business information, safeguarding of group assets, compliance with laws and regulations, financial information and general operation.

The board reviewed and was satisfied with the effectiveness of the internal financial and operating controls, the process of risk management and the monitoring of legal governance compliance within the group.

COMBINED ASSURANCECapital’s combined assurance model is based on three levels of assurance for all of the significant risks. Level one is management

assurance instigated by the line managers. Level two is internal assurance achieved through the oversight by the executive management of the company and level three is external assurance achieved through the oversight by the independent non-executive directors and the external auditors.

By adopting this approach, the company is doing everything reasonably practical to give assurance to the board that risks are mitigated and that effective controls are in place.

INVESTMENT COMMITTEEAll acquisitions, disposals and capital expenditure are considered by the investment committee. The investment committee approves acquisitions, disposals and capital expenditure up to pre-set limits.

The investment committee comprises Banus van der Walt (chairman), Barry Stuhler, Andrew Teixeira, Jan Potgieter and Trurman Zuma, the majority of whom are independent, non-executive directors. All members of this committee have extensive experience and technical expertise in the office, retail, logistics and industrial property industries.

The investment committee’s responsibilities and duties are governed by a charter adopted by the board that was approved in 2014.

NOMINATION COMMITTEEThe nomination committee is mandated by the board to identify suitable candidates to be appointed to the board, identify suitable board candidates in order to fill vacancies, ensure there is a succession plan in place for key management, assess the independence of non-executive directors and assess the composition of the board sub-committees. The nomination committee recommends the individuals to the board for appointment.

The nomination committee comprises Iraj Abedian (chairman), Jan Potgieter and Tshiamo Vilakazi.

The nomination committee’s responsibilities and duties are governed by a charter that was approved by the board in 2014.

RISK COMMITTEEThe risk committee is mandated by the board to ensure that sound risk management is maintained, to assist the board in discharging its duties relating to the safeguarding of assets and to ensure that the company has implemented an effective plan for risk management that will enhance the company’s ability to achieve its strategic objectives.

The risk management plan is reviewed annually and the risk matrix is presented and discussed at each meeting. During the year, the risk committee met with members of senior management and had access to all employees and data necessary for it to perform its functions. The risk committee is satisfied that the Company has complied, in all material respects, with its risk management policy.

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The risk committee comprises Tshiamo Vilakazi (chairman) and Protas Phili who are independent non-executive directors and Andrew Teixeira, who is an executive director.

The risk committee’s responsibilities and duties are governed by a charter that was approved by the board in 2014.

SOCIAL AND ETHICS COMMITTEEThe social and ethics committee is a statutory committee whose focus is to monitor compliance with labour legislation as well as corporate social responsibilities and corporate citizenship.

The social and ethics committee comprises Tshiamo Vilakazi (chairperson) and Banus van der Walt, who are independent non-executive directors and Barry Stuhler, who is an executive director.

The social and ethics committee’s responsibilities and duties are governed by a charter that was approved by the board in 2014.

REMUNERATION COMMITTEEThe remuneration committee is mandated by the board to determine the remuneration and incentivisation of all employees, including executive directors. In addition, the remuneration committee recommends directors’ fees payable to non-executive directors and members of board sub-committees.

The remuneration committee comprises Trurman Zuma (chairman) and Protas Phili who are independent non-executive directors and Barry Stuhler, who is an executive director.

The remuneration committee’s responsibilities and duties are governed by a charter that was reviewed by the board in 2014.

COMPANY SECRETARYThe board considered the competence, qualifications and experience of the company secretary who is deemed fit to continue in the role as company secretary for Capital. The company secretary’s relationship with the board has been assessed and is considered to be at arm’s length.

INFORMATION TECHNOLOGY GOVERNANCEThe board is ultimately responsible for IT governance. The Capital IT function is outsourced to a third party service provider and is governed by a service level agreement. Compliance with the service level agreement is monitored by management and the terms are reviewed on a regular basis. There is a dedicated member of the Capital management team who oversees the IT function, attends the executive committee meetings and reports thereat. The risks and controls over IT assets and data are considered by the risk committee.

DEALING IN SECURITIES BY THE DIRECTORSDealing in the company’s securities by directors and company officials is regulated and monitored as required by the JSE Listings

Requirements and the company’s policy. In addition, Capital maintains a closed period from the end of a financial reporting period to the date of publication of the financial results.

PROMOTION OF ACCESS TO INFORMATION ACTThere were no requests for information lodged with the company in terms of the Promotion of Access to Information Act No 2 of 2000.

SPECIAL RESOLUTIONS PASSEDIn addition to the special resolutions noted below, a number of Capital’s subsidiaries passed a special resolution during the year authorising the provision of financial assistance in accordance with sections 45 and 46 of the Companies Act, 2008.

1. Conversion from a private company to a public company

It was resolved, the company be and is hereby converted from a private company to a public company, and that the company’s new memorandum of incorporation filed pursuant to the passing of special resolution number 4, include the necessary provisions relevant to a public company.

2. Increase the authorised share capital to 3 000 000 000 ordinary shares

It was resolved, subject to compliance with the requirements of the Companies Act, 2008 and the company’s memorandum of incorporation, the company increases its authorised share capital of 1 000 ordinary shares of no par value to 3 000 000 000 ordinary shares of no par value by the creation of an additional 2 999 999 000 ordinary shares of no par value and that clause 8.1 of the company’s new memorandum of incorporation read as follows:

The Company is authorised to issue 3 000 000 000 shares of the same class, each of which ranks pari passu (which shall have the meaning ascribed thereto in paragraph 3.29 of the JSE Listings Requirements or any amendment paragraph in the JSE Listings Requirements) in respect of all rights.

3. Change of name to Capital Property Fund Limited

It was resolved that the name of the company be and hereby is changed from Friedshelf 1497 Limited to Capital Property Fund Limited.

4. Adoption of new memorandum of incorporation

It was resolved that, subject to the approval of special resolutions numbers 1, 2 and 3 above, the company’s existing memorandum of incorporation be and is hereby replaced in its entirety with a new memorandum of incorporation, tabled at the general meeting and initialled by the chairman for identification purposes.

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5. Approval of provision of financial assistance for the purchase of shares

It was resolved that, subject to compliance with the requirements of the company’s memorandum of incorporation, the Companies Act, 2008 and the JSE Listings Requirements, the company, either as lender or as surety or guarantor for a lender, or otherwise, is hereby authorised, from time to time, to provide financial assistance as contemplated in section 44 of the Companies Act, 2008, for the purchase of or subscription for any shares issued or to be issued by the company to any company or trust, the majority of whose shareholders or beneficiaries (directly or indirectly) are “black persons” as defined in the Broad-based Black Economic Empowerment Act, 2003 (or any successor thereto) on the following terms:

(i) the maximum capital amount (excluding interest, costs, charges, fees and expenses) of any such amounts lent or for which suretyships or guarantees are given may not exceed R1 billion;

(ii) the maximum period for the repayment of any loan provided or for which suretyships or guarantees are given in terms hereof may not exceed 10 years; and

(iii) the minimum interest rate to be applied to any loan provided may not be less than the prime overdraft rate of interest from time to time publicly quoted as such by The Standard Bank of South Africa Limited,

such authority to endure for a period of not more than two years from the passing of this resolution or until its renewal, whichever is the earliest.

6. Approval of provision of financial assistance to related or inter-related companies

It was resolved that, to the extent required by the Companies Act, 2008, the board of directors of the company may, subject to compliance with the requirements of the company’s memorandum of incorporation, the Companies Act, 2008 and the JSE Listings Requirements, each as presently constituted and amended from time to time, authorise the company to provide direct or indirect financial assistance as contemplated in section 45 of the Companies Act, 2008 by way of loans, guarantees, the provisions of security or otherwise, to any of its present or future subsidiaries and/or any other company or corporation that is or becomes related or inter-related (as defined in the Companies Act, 2008) to the company for any purpose or in connection with any matter, such authority to endure for a period of not more than two years from the passing of this resolution or until its renewal, whichever is the earliest.

7. Approval of share repurchases It was resolved that, subject to compliance with the

requirements of the company’s memorandum of incorporation, the Companies Act, 2008 and the JSE Listings

Requirements, each as presently constituted and amended from time to time, and the restrictions set out below, the repurchase of shares of the company, either by the company or by any subsidiary of the company is hereby authorised, on the basis that:

(i) this authority will only be valid until the company’s annual general meeting or for 15 months from the date of this resolution, whichever period is shorter;

(ii) the number of shares which may be acquired pursuant to this authority in any financial year may not in the aggregate exceed 20%, or 10% where such acquisitions are effected by a subsidiary, of the company’s share capital as at the date of this resolution;

(iii) the repurchase of shares must be effected through the order book operated by the JSE trading system and done without any prior arrangement between the company and the counter-party;

(iv) the repurchase of shares may not be made at a price greater than 10% above the weighted average of the market value for the shares for the five business days immediately preceding the date on which the transaction is effected;

(v) at any point in time, the company will only appoint one agent to effect repurchases on its behalf;

(vi) the company or its subsidiary may not repurchase shares during a prohibited period as defined in paragraph 3.67 of the JSE Listings Requirements unless there is a repurchase programme in place and the dates and quantities of shares to be repurchased during the prohibited period are fixed and full details thereof have been disclosed in an announcement over SENS prior to commencement of the prohibited period;

(vii) a resolution by the board of directors is passed that the board of directors of the company authorises the repurchase, that the company and the relevant subsidiaries have passed the solvency and liquidity test as set out in section 4 of the Companies Act, 2008 and that, since the test was performed, there have been no material changes to the financial position of the group; and

(viii) the company’s sponsor will confirm the adequacy of the company’s working capital, for the purposes of undertaking share repurchases, in writing to the JSE prior to the repurchase of any shares.

In accordance with the JSE Listings Requirements the directors record that although there is no immediate intention to effect a repurchase of the shares of


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the company, the directors will utilise this general authority to repurchase shares as and when suitable opportunities present themselves, which opportunities may require expeditious and immediate action.

The directors, after considering the effect of the maximum repurchase, are of the opinion that for a period of 12 months after the passing of this resolution:

• the company and the group will, in the ordinary course of business, be able to pay its debts;

• the assets of the company and the group will be in excess of the liabilities of the company and the group;

• the share capital and reserves of the company and the group will be adequate for ordinary business purposes; and

• the working capital of the company and the group will be adequate for ordinary business purposes.

After the company or its subsidiaries has cumulatively repurchased 3% of the initial number of shares (the number of shares in issue at the time that the general authority from shareholders is granted) and for each 3% in aggregate of the initial number of that class acquired thereafter, an announcement will be made in terms of the JSE Listings Requirements.

9. Name changes During the year, iFour Properties Two Proprietary Limited and Siyathenga Properties One Proprietary Limited passed special resolutions

to change their names to Capital Propfund 4 Proprietary Limited and Capital Propfund 3 Proprietary Limited, respectively.

For the year ended Dec 2014

Rand

For the year ended Dec 2015

Rand

Chairman 325 000 351 000

Non-executive director 225 000 243 000

Audit committee member (including chairman) 100 000 108 000

Investment committee member (including chairman) 100 000 108 000

Remuneration committee member (including chairman) 100 000 108 000

Nomination committee member (including chairman) 50 000 54 000

Risk committee member (including chairman) 50 000 54 000

Social and ethics committee member (including chairman) 50 000 54 000

SHARE ISSUESThere were three share issues during the 2014 financial year:

(1) Effective 30 June 2014, 70 754 717 shares were issued at R10,60.

(2) Effective 30 June 2014, 1 606 986 279 shares were issued at R10,70.

(3) Effective 6 October 2014, 83 333 333 shares were issued at R12,00.

Please refer to the pre-listing statement and circular dated 9 May 2014.

8. Approval of directors’ remuneration for their services as directors It was resolved that, in accordance with section 66 of the Companies Act, 2008, the fees payable by the company to non-executive

directors for their services as directors be and are hereby approved, for a period of two years from the date of passing this resolution or until its renewal, whichever is the earliest, as follows:

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COMMUNICATIONS WITH STAKEHOLDERSCapital is committed to ensuring timeous, effective and transparent communication with shareholders and other stakeholders.

Stakeholder Communication

Shareholder Capital is committed to providing shareholders with timely access to applicable information. Communication with its shareholders is open, honest and transparent. Shareholders are provided with information via circulars and integrated and interim reports. Capital holds semi-annual results presentations in Johannesburg and Cape Town. Additional information is provided on Capital’s website, via SENS announcements and press releases.

Analysts Capital holds semi-annual results presentations in Johannesburg and Cape Town.

Financiers Capital meets with its financiers on a regular basis to discuss its requirements and theirs. Information is provided through analyst presentations, road shows, integrated reports and interim reporting.

Tenants Capital strives to form mutually beneficial business relationships with its tenants. Capital’s asset managers and property managers meet with the tenants on a regular basis and conduct regular site visits to Capital’s properties.

Government Capital endeavours to have mutually beneficial relationships with government, its departments and parastatals. Capital engages with local authorities both directly and via its property managers and external consultants regarding utility issues, rates clearances, zoning etc.

Industry associations Capital’s asset managers belong to various industry bodies including SAPOA and the SA Shopping Centre Council and regularly attend industry conferences. Capital is a member of the SA REIT committee and was actively involved in the REIT legislation process.

Business partners Capital maintains professional working relationships with its business partners at the same time as fostering a culture of teamwork. Capital ensures that all of its business partners fully understand the Company's performance standards and requirements. Capital’s business partners include the property managers and both Capital’s asset managers and senior management meet with the property managers on a regular basis.

Communities and environment Capital is committed to being a good corporate citizen and frequently evaluates the impact of its projects and developments on society and the environment.

Suppliers Capital maintains professional working relationships with all of its suppliers and ensures that its suppliers understand Capital’s performance standards and requirements. Where possible, Capital will have service level agreements or terms of reference for its relationships with suppliers, which include performance expectations.

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ReportingS U S T A I N A B I L I T Y

At Capital, our approach to the concept of sustainability relates to the maintenance and enhancement of environmental, social and economic resources, in order to meet the needs of current and future generations. This is founded in a commitment to being a good corporate citizen, operating in a commercially sensible and socially responsible manner.

ENVIRONMENTALCapital has adopted an environmental policy which sets out its intentions and commitment to sustainability through the reduction of electricity consumption and water usage. This policy is monitored by executive management. Energy efficiency is foremost in our sustainability endeavours particularly given the current power crisis impacting South Africa.

In respect of all works there is a focus on the fundamental architectural principles, one of which is building aspect, which helps to passively address the heat loads and natural lighting options available in buildings. Since air conditioning constitutes the largest percentage of energy consumption, in the region of 60%, in the majority of buildings, new and retrofit systems will incorporate improved standards of insulation, shading, glazing, ventilation and efficient air conditioning plant. The approach to enhance efficiency will also incorporate dealing with education and adjustment of personal habits of tenants occupying buildings, these include sensor switching, night flushing and changing set points according to seasonal changes. On new and replacement plant we are utilising variable speed drive compressors and staged units to best balance demand and supply of air conditioned space. Building management systems (BMS) are steadily improving and are currently used in specific applications where their cost benefit may justify their implementation.

Where possible we are utilising newer, more efficient lighting systems and incorporating rational design principles to maximise the lighting levels whilst reducing energy consumption on new works. We have and will continue retrofitting older buildings on a replacement basis with more efficient technologies and these include CFL, LED and T5 replacement lamps in accordance with Eskom’s Demand Management Incentive Programme. We have implemented and installed LED and energy efficient lighting in a number of our buildings.

Capital is engaging with Eskom on an ongoing basis in terms of their demand side management programs, and attends the green building conferences and other forums to remain abreast of international best practice, legal requirements and technical improvements.

SANS 204 energy efficiency in buildings regulation has a significant impact on new building efficiency. Our new developments are compliant with the SANS 204 energy efficiency requirements. The majority of new developments are fitted with T5 mega-bay fittings which are currently the best energy efficient options to achieve the required level of 200 lux. A number of the developments have

also been fitted with motion sensors in order to reduce electricity consumption. The warehouses are designed with polycarbon sheeting which allow natural lighting to have maximum penetration in order to reduce consumption.

Water is a precious resource and in order to manage utilisation, Capital is focusing on the comprehensive measurement thereof. As standard practice, new and refurbishment works are being fitted with low flushing mechanisms and metered discharge taps to reduce consumption and limit waste. Timers on existing geysers and solar geysers play a part in reducing consumption and more recently the utilisation of heat pumps.

As reported in the prior year, energy audits were conducted at a number of properties. We have completed the installation of energy efficient lighting at a number of properties most notably Thrupps Illovo Centre.

Although we are still in the process of finalising the environmental approvals at Clairwood Logistics Park, we have identified a number of areas in the park to be retained as conservation areas. These currently amount to 13.87 hectares and include wetland and grassland conservation areas.

Capital undertakes a significant amount of construction both in the form of new developments and re-developments of existing properties. Our aim is to have minimum impact on the environment. Capital is re-developing a portion of 60 Electron Avenue in Isando. A significant portion of the building was recycled into the redevelopment.

ECONOMICCapital’s Broad-Based Black Economic Empowerment (“B-BBEE”) initiative focus is on the broad based scheme undertaken through The Siyakha Education Trust (“The Trust”). In October 2014, Capital issued R1 billion of shares to The Trust for which Capital provided the loan funding. The Trust is a charitable trust and is registered as a public benefit organisation. It owns 83 333 333 Capital shares. The projects completed by the Trust are discussed under the Social section of this report.

Subsequent to Capital’s conversion to a corporate REIT and entering into the B-BBEE transaction with The Trust, Capital aims to obtain a B-BBEE certificate in the coming year.

SOCIALThe Trust was established with the exclusive purpose of promoting black education in South Africa. The Trust grants bursaries to students from previously disadvantaged backgrounds and communities. It also provides computer equipment and infrastructure, for example secured computer facilities, to schools in underprivileged communities.

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The Trust has entered a really exciting initiative during the year in the form of its learning centres. To date, the Trust has supported education on an individual basis, helping schools, one project at a time. Although the end result is sustainable, relevant and value-added, it has become clear that a more dramatic reach is needed. More people of all ages need the opportunity to learn and grow within a skills-transfer environment. The first learning centre at Tubatse Crossing in Burgersfort opened in December 2014. The creation of the Siyakha Education Trust Learning Lab ticked all the boxes and most importantly, its best feature is that it is free. The learning lab contains computer hives where people are welcome to use the computers for anything from research and self-help studies to writing assignments. There is a study bar where people can bring and use their own devices supervised by a floor manager who is qualified in IT literacy and troubleshooting. The main feature of the Siyakha Education Trust Learning Lab is the Think Tank. This is a learning “box” within the lab where all the training will take place. Training will include internet courses, soft skills training and training from guest experts. The Think Tank keeps it personal limiting access to 30 users at a time and courses, which will be advertised via printed and electronic media, need to be pre-booked. The Think Tank courses will be presented by qualified trainers who are respected experts in their fields. There is also a study library which is a stand-alone structure complete with self-help study guides, as well as grade 12 past exam papers for Life Science, Accountancy and Geography.

In the six months ended 31 December 2014, the Trust has assisted 24 schools across 7 provinces with a total spend of R25.6 million as follows:

In Limpopo province, the Trust provided Laerskool Pietersburgnoord with 51 new computers, e-beams and security. Laerskool Bosveld was provided with 40 new computers and the upgrade, refurbishment, furnishing and securing of their computer lab. At Northam Primary School, the Trust refurbished and extended the science and computer labs. The school was also provided with new computers, equipment for the science lab and furniture for both labs.

In the North West province at Oom Paul Special School, two consumer science classes were upgraded. The Keurhof Special School’s computer class was upgraded and a new woodwork classroom was built. The media centre was upgraded at Laerskool Rustenburg Noord. New computer and library equipment were also provided. A new science classroom, laboratory and equipment were provided to Educators High School in Klerksdorp. At Meerhof School, the Trust built and equipped a new consumer science class and life science laboratory.

In KwaZulu-Natal, repairs to classrooms and training on computer systems were provided to Filidi Special School and Landbou High School. A new science and mathematics laboratory was built, equipped and secured.

At Kiriyatswane Secondary School in Mpumalanga, the physical and life sciences laboratories were equipped. The two computer classrooms at Lowveld High School were refurbished and equipped with 60 new computers. The Trust also refurbished and equipped two computer classes and provided much needed physical and life sciences equipment at George Hofmeyr High School.

In Gauteng, consumer science laboratories were refurbished and equipped at Alma Special School and Eurika Special School. The media centre was upgraded and equipped at Boys and Girls Town. New computer classes were built, equipped and secured at Laerskool Bekker and Sinqobile Primary School. The Trust paid for the refurbishment and upgrade of Sinqobile Daycare Centre. The domestic science and woodwork classes were refurbished at Krugerlaan School.

The Trust refurbished 14 classrooms as well as bathrooms, storerooms and the hall at Unicom Primary School in the Eastern Cape. At Nkosi Sikilela Primary School, 13 classrooms were upgraded as were the bathrooms. The domestic sciences classroom was upgraded and equipped and 52 new computers were provided to Aliwal North High School. The Trust provided 4 new prefab classrooms, the kitchen was refurbished and re-equipped and new laptops and projectors were provided. Two new, furnished computer classes were provided to Pelliser Combined School.

In the Free State a new consumer science class and 21 new computers were provided at Bohmer Secondary School.

The Trust also participated in a number of special projects in the six months ended 31 December 2014 including

• sponsorship of the Maths & Science Leadership Academy’s career programme;

• the refurbishment and equipment of the telemarketing training centre for the deaf and blind situated at Action School for Deaf and Blind in Roodepoort;

• sponsorship of a 16 page career guide in national newspapers; and

• sponsorship of a study resource centre at Kinndo Life Children’s Centre.

(continued)

ReportingS U S T A I N A B I L I T Y

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OUR EMPLOYEESOur employees are as intrinsic to our business as our properties. We strive to create a productive working environment. The remuneration of our employees is elaborated on in the remuneration report on page 17.

As discussed in note 6 to the financial statements, Capital has a Share Purchase Scheme in terms of which loans are granted to employees to enable them to purchase shares in Capital. We believe that empowering our employees in this way aligns their interests even closer to those of shareholders.

We maintain open channels of communication with our employees that include weekly meetings with our asset managers and monthly and ad hoc staff meetings for all employees. Our employees have access to Capital’s policies and procedures, including those on disciplinary and grievance procedures, via the intranet. None of Capital’s employees engage in collective bargaining processes.

Capital has implemented an employment equity plan and we support the promotion of equal opportunities. Our focus is on developing our employees such that there are suitable internal candidates to lead Capital in the future.

We encourage our employees to attend job-related training such as industry specific conferences and courses. Our training and employment equity committee meets on a regular basis and approves the employment equity plan, our workplace skills plan and annual training report. The committee is chaired by a member of senior management. There were 31 employees who received training worth R0.1 million for the period 1 July 2014 to 31 December 2014.

Capital recognises that HIV/Aids presents a risk to its workforce and has adopted an HIV/Aids policy. This policy governs, among other items, the confidentiality relating to employees’ HIV status and prohibits discrimination on the basis of an employee or potential employee’s HIV status.

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ReviewF I V E Y E A R

2014R'million

2013R'million

2012R'million

2011R'million

2010R'million

Summarised statement of financial position

Investment property 16 375 15 825 16 065 15 853 6 012

Investment property under development 1 450 1 045 870 468 167

Investments 8 508 5 433 3 147 1 628 944

Capital incentive scheme loans 205 - - - -

Loans to BEE vehicle 1 027 - - - -

Current assets 392 289 258 263 15

Total assets 27 957 22 592 20 340 18 212 7 138

Total equity attributable to equity holders 20 364 16 575 13 964 12 521 5 298

Interest-bearing borrowings 6 944 4 703 4 418 1 949 694

Other non-current liabilities 209 14 736 552 59

Current liabilities 440 1 300 1 222 3 190 1 087

Total equity and liabilities 27 957 22 592 20 340 18 212 7 138

Net asset value per share/unit (Rand) 11.56 10.71 9.05 8.13 7.70

Summarised statement of comprehensive income

Recoveries and contractual rental revenue 2 071 2 058 2 140 1 946 721

Property operating expenses (718) (711) (723) (633) (203)

Distributable income from investments 315 252 145 22 71

Fair value gain on investment property and investments 2 104 1 722 1 526 796 564

Loss on surety (90) - - - -

Amortisation of management contract (749) - - - -

REIT conversion costs (8) - - - -

Administrative expenses (69) (93) (91) (74) (35)

Other 95 83 180 (98) -

Profit before net finance costs 2 951 3 311 3 177 1 959 1 118

Net finance costs (62) (127) (413) (264) (130)

Profit before income tax 2 889 3 184 2 764 1 695 988

Income tax (191) 643 (200) (45) (12)

Profit for the year attributable to equity holders 2 698 3 827 2 564 1 650 976

Share/unit statistics

Shares in issue 1 761 074 329 1 606 986 279 1 606 986 279 1 606 986 279 717 578 059

Distribution per share/unit (cents) 83.44 75.62 69.78 65.63 60.14

Closing price (Rand) 13.28 10.65 10.70 8.81 8.21

Property statistics

Total number of properties 252 252 262 276 110

Total GLA 2 390 376 2 278 907 2 404 329 2 423 268 914 426

Average annualised property yield 9.1% 9.2% 9.4% 9.4% 9.5%

Expense ratios

Net property expense ratio 15.1% 13.9% 12.4% 12.1% 7.5%

Gross property expense ratio 34.7% 34.6% 33.8% 33.2% 28.8%

Net total expense ratio 13.5% 17.1% 16.5% 17.0% 12.4%

Gross total expense ratio 33.0% 34.8% 35.6% 36.7% 30.7%

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StatisticsP O R T F O L I O

SECTORAL SPLIT

GEOGRAPHICAL SPLIT

TENANT PROFILE

WEIGHTED AVERAGE RENTAL PER SQM

GLA■ Retail 6%

■ Industrial 5%

■ Office 13%

■ Logistics 75%

■ Other 1%

GLA■ Gauteng 76.8%

■ Eastern Cape 2.3%

■ KwaZulu-Natal 12.1%

■ Western Cape 7.7%

■ Mpumalanga 0.6%

■ Free State 0.5%

GLA■ A 47.5%

■ B 28.3%

■ C 24.2%

PER SQM■ Retail R 121

■ Industrial R 42

■ Office R 109

■ Logistics R 52

■ Other R 105

RENTAL■ Gauteng 77.1%

■ Eastern Cape 1.3%

■ KwaZulu-Natal 12.5%

■ Western Cape 7.7%

■ Mpumalanga 0.5%

■ Free State 0.9%

RENTAL■ A 47.2%

■ B 27.7%

■ C 25.1%

ESCALATION■ Retail 7.7%

■ Industrial 8.1%

■ Office 8.6%

■ Logistics 8.4%

■ Other 9.2%

VALUATION■ Retail 12%

■ Industrial 2%

■ Office 25%

■ Logistics 60%

■ Other 1%

2014

2014

2014

2014

2014

2014

2014

2014

Weighted average rental per m2

A Large national tenants, large listed tenants, govern-ment and major franchisees.

B National tenants, listed tenants, franchisees, medium to large professional firms.

C Other, comprising mainly smaller tenants of which there are 1 024 tentants.

The average annualised property yield is 9.1%.

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40

TOTAL PORTFOLIO - LEASE EXPIRY

RETAIL - LEASE EXPIRY

OFFICES - LEASE EXPIRY

GLA■ Vacant 4.5%

■ Dec-15 22.7%

■ Dec-16 21.1%

■ Dec-17 21.8%

■ Dec-18 13.4%

■ Dec-19 7.9%

■ > Dec-19 8.6%

GLA■ Vacant 4.1%

■ Dec-15 22.0%

■ Dec-16 7.6%

■ Dec-17 10.6%

■ Dec-18 10.5%

■ Dec-19 20.1%

■ > Dec-19 25.1%

GLA■ Vacant 11.6%

■ Dec-15 19.1%

■ Dec-16 21.1%

■ Dec-17 28.1%

■ Dec-18 9.5%

■ Dec-19 3.8%

■ > Dec-19 6.8%

RENTAL■ Vacant

■ Dec-15 22.6%

■ Dec-16 19.2%

■ Dec-17 23.1%

■ Dec-18 14.7%

■ Dec-19 9.5%

■ > Dec-19 10.9%

RENTAL■ Vacant

■ Dec-15 22.0%

■ Dec-16 8.2%

■ Dec-17 13.8%

■ Dec-18 13.3%

■ Dec-19 19.7%

■ > Dec-19 23.0%

RENTAL■ Vacant

■ Dec-15 20.6%

■ Dec-16 21.4%

■ Dec-17 32.9%

■ Dec-18 12.5%

■ Dec-19 4.9%

■ > Dec-19 7.7%

2014

2014

2014

2014

2014

2014

(continued)

StatisticsP O R T F O L I O

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INDUSTRIAL - LEASE EXPIRY

LOGISTICS - LEASE EXPIRY

OTHER - LEASE EXPIRY

GLA■ Vacant 4.8%

■ Dec-15 10.0%

■ Dec-16 36.9%

■ Dec-17 10.3%

■ Dec-18 16.8%

■ Dec-19 4.8%

■ > Dec-19 16.4%

GLA■ Vacant 3.3%

■ Dec-15 24.4%

■ Dec-16 21.3%

■ Dec-17 22.6%

■ Dec-18 14.1%

■ Dec-19 7.8%

■ > Dec-19 6.5%

GLA■ Vacant -

■ Dec-15 10.7%

■ Dec-16 11.7%

■ Dec-17 10.1%

■ Dec-18 16.8%

■ Dec-19 -

■ > Dec-19 50.7%

RENTAL■ Vacant

■ Dec-15 10.0%

■ Dec-16 37.3%

■ Dec-17 11.7%

■ Dec-18 18.3%

■ Dec-19 5.5%

■ > Dec-19 17.2%

RENTAL■ Vacant

■ Dec-15 24.4%

■ Dec-16 20.1%

■ Dec-17 22.2%

■ Dec-18 15.6%

■ Dec-19 9.6%

■ > Dec-19 8.1%

RENTAL■ Vacant

■ Dec-15 10.7%

■ Dec-16 11.3%

■ Dec-17 12.4%

■ Dec-18 15.7%

■ Dec-19 -

■ > Dec-19 49.9%

2014

2014

2014

2014

2014

2014

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42

TOP 10 LOGISTICS BUILDINGS

Name Province GLAValue @ Dec 14

R’000% of logistics

portfolio Major tenants

Isando Business Park Gauteng 56 517 318 000 3.4% Lion Match Company; Kapele Freight and Logistics; Wild & Marr; Swissport; Orica Africa; Chandler Coal; AGFA

Silverstone Raceway Gauteng 40 796 275 000 2.9% Uti

City Deep Industrial Park Gauteng 56 816 264 700 2.8% Bidvest; Teraoka; Kemtek

118 Brakpan Road Gauteng 37 027 239 800 2.5% DHL Exel Supply Chain (South Africa)

Mirabel Road Pomona Gauteng 31 856 194 000 2.0% CHC Resources; Cotton On South Africa

Jonas Road Germiston Gauteng 36 924 182 000 1.9% iCon Carriers; OCTO Logistics; Vera Cruise

12 Platinum Road Longmeadow Gauteng 17 456 168 200 1.8% Uti Pharmacare

Catalunya Crescent Raceway Gauteng 21 491 162 300 1.7% Monsanto

N1 Business Park * Gauteng 87 216 161 600 1.7% Mazda; Landis & GYR; Zodiac; Elliot Mobility; MTN; Digistics; Poynting; Eli Lily; Tevo

Surprise Park Pinetown KwaZulu-Natal 25 516 150 400 1.6% Worldnet Logistics

2 116 000

TOP 10 OFFICE BUILDINGS


R’000% of office


West Street Sandton Gauteng 14 143 372 000 8.8% Edward Nathan Sonnenberg

Long Street Cape Town Western Cape 23 487 339 200 8.0% Harambee; South African Maritime Safety Authority; DRA; Blastrit; Shepstone & Wylie; Grindrod; Knowles Hussein; Iberdrola

Monyetla Office Park Gauteng 17 535 237 600 5.6% DRA Mining Projects; Eskom

Oak Avenue Highveld Gauteng 11 700 198 300 4.7% Telkom SA

Cullinan Office Park Gauteng 9 428 190 000 4.5% SNC Lavalin SA; Acsis; Samancor Chrome

PricewaterhouseCoopers Pretoria Gauteng 6 405 172 000 4.1% PricewaterhouseCoopers

Kildrummy Office Park Paulshof Gauteng 11 944 169 500 4.0% Kansai Plascon; Unilever; CIRO; Media24

Oxford Manor Illovo Gauteng 12 722 166 100 3.9% Life Healthcare Group; Wertheim Becker Inc; Primedia Outdoor

Rutherford Estate Scott Street Gauteng 9 192 162 000 3.8% VOX Telecoms; VAT-IT

Fourways Office Park Fourways Gauteng 15 146 158 500 3.7% Monsanto South Africa; Kellog Brown and Root South Africa; Pam Golding; Blue Horizon; Epsom; Metrix

2 165 200

TOP 10 RETAIL BUILDINGS


R’000% of retail


The Crescent Umhlanga KwaZulu-Natal 27 717 455 000 22.4% Pick 'n Pay; Builders Express; Food Lovers Market

Pineslopes Shopping Centre Gauteng 21 167 316 000 15.5% Checkers; Spar

Palm Springs Mall Gauteng 19 902 288 000 14.2% Checkers; Cashbuild

Thrupps Illovo Centre Gauteng 13 376 257 600 12.7% Thrupps Retail

Leslie Road Retail Park Gauteng 13 676 173 700 8.5% Cycle Lab; The Pro Shop; Lexus

Edgars West Street KwaZulu-Natal 14 200 140 200 6.9% Edcon

Bloemfontein Value Mart Free State 12 385 140 000 6.9% Game; Mambo's Plastic Warehouse; Sportsmans Warehouse

Fourways Value Mart Gauteng 7 938 105 600 5.2% Fabric Fusion; Adams Discount Centre

Appleton’s Gauteng 3 753 58 800 2.9% Woolworths Food; Clicks; Nandos

Jeffreys Bay Eastern Cape 14 519 53 500 2.6% Checkers; Builders Express

1 988 400 * Capital has a 20% interest in this development.

PortfolioG R O U P P R O P E R T Y

TOP 10 BY VALUE

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TOP 10 LOGISTICS BUILDINGS


R’000% of logistics


Isando Business Park Gauteng 56 517 318 000 3.4% Lion Match Company; Kapele Freight and Logistics; Wild & Marr; Swissport; Orica Africa; Chandler Coal; AGFA

Silverstone Raceway Gauteng 40 796 275 000 2.9% Uti

City Deep Industrial Park Gauteng 56 816 264 700 2.8% Bidvest; Teraoka; Kemtek

118 Brakpan Road Gauteng 37 027 239 800 2.5% DHL Exel Supply Chain (South Africa)

Mirabel Road Pomona Gauteng 31 856 194 000 2.0% CHC Resources; Cotton On South Africa

Jonas Road Germiston Gauteng 36 924 182 000 1.9% iCon Carriers; OCTO Logistics; Vera Cruise

12 Platinum Road Longmeadow Gauteng 17 456 168 200 1.8% Uti Pharmacare

Catalunya Crescent Raceway Gauteng 21 491 162 300 1.7% Monsanto

N1 Business Park * Gauteng 87 216 161 600 1.7% Mazda; Landis & GYR; Zodiac; Elliot Mobility; MTN; Digistics; Poynting; Eli Lily; Tevo

Surprise Park Pinetown KwaZulu-Natal 25 516 150 400 1.6% Worldnet Logistics

2 116 000

TOP 10 OFFICE BUILDINGS


R’000% of office


West Street Sandton Gauteng 14 143 372 000 8.8% Edward Nathan Sonnenberg

Long Street Cape Town Western Cape 23 487 339 200 8.0% Harambee; South African Maritime Safety Authority; DRA; Blastrit; Shepstone & Wylie; Grindrod; Knowles Hussein; Iberdrola

Monyetla Office Park Gauteng 17 535 237 600 5.6% DRA Mining Projects; Eskom

Oak Avenue Highveld Gauteng 11 700 198 300 4.7% Telkom SA

Cullinan Office Park Gauteng 9 428 190 000 4.5% SNC Lavalin SA; Acsis; Samancor Chrome

PricewaterhouseCoopers Pretoria Gauteng 6 405 172 000 4.1% PricewaterhouseCoopers

Kildrummy Office Park Paulshof Gauteng 11 944 169 500 4.0% Kansai Plascon; Unilever; CIRO; Media24

Oxford Manor Illovo Gauteng 12 722 166 100 3.9% Life Healthcare Group; Wertheim Becker Inc; Primedia Outdoor

Rutherford Estate Scott Street Gauteng 9 192 162 000 3.8% VOX Telecoms; VAT-IT

Fourways Office Park Fourways Gauteng 15 146 158 500 3.7% Monsanto South Africa; Kellog Brown and Root South Africa; Pam Golding; Blue Horizon; Epsom; Metrix

2 165 200

TOP 10 RETAIL BUILDINGS


R’000% of retail


The Crescent Umhlanga KwaZulu-Natal 27 717 455 000 22.4% Pick 'n Pay; Builders Express; Food Lovers Market

Pineslopes Shopping Centre Gauteng 21 167 316 000 15.5% Checkers; Spar

Palm Springs Mall Gauteng 19 902 288 000 14.2% Checkers; Cashbuild

Thrupps Illovo Centre Gauteng 13 376 257 600 12.7% Thrupps Retail

Leslie Road Retail Park Gauteng 13 676 173 700 8.5% Cycle Lab; The Pro Shop; Lexus

Edgars West Street KwaZulu-Natal 14 200 140 200 6.9% Edcon

Bloemfontein Value Mart Free State 12 385 140 000 6.9% Game; Mambo's Plastic Warehouse; Sportsmans Warehouse

Fourways Value Mart Gauteng 7 938 105 600 5.2% Fabric Fusion; Adams Discount Centre

Appleton’s Gauteng 3 753 58 800 2.9% Woolworths Food; Clicks; Nandos

Jeffreys Bay Eastern Cape 14 519 53 500 2.6% Checkers; Builders Express

1 988 400 * Capital has a 20% interest in this development.

GROUP PROPERTY PORTFOLIO SNAPSHOTOffice Industrial Logistics Retail Other

Number of properties 51 8 164 11 5

Property value (R'million) 4 233 369 9 485 2 035 253

% of property value 25.9% 2.3% 57.9% 12.4% 1.5%

Total GLA (m2) 301 104 89 295 1 796 707 155 215 20 743

% of GLA 12.7 % 3.8% 76.0% 6.6% 0.9%

This table excludes investment property under development.

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44

for the year ended 31 December 2014

The directors are responsible for the preparation and fair presentation of the group annual financial statements and separate annual financial statements of Capital Property Fund Limited (“the company”), comprising the statements of financial position as at 31 December 2014, the statements of comprehensive income, the statements of changes in equity and statements of cash flows for the year then ended, and the notes to the financial statements, which include a summary of significant accounting policies and other explanatory notes, as well as the directors’ report, in accordance with International Financial Reporting Standards and the requirements of the Companies Act of South Africa.

The directors’ responsibility includes: designing, implementing and maintaining internal controls relevant to the preparation and fair presentation of these financial statements that are free from material misstatement, whether due to fraud or error, selecting and applying appropriate accounting policies, and making accounting estimates that are reasonable in the circumstances.

The directors’ responsibility also includes maintaining adequate accounting records and an effective system of risk management, as well as the preparation of the supplementary schedules included in these financial statements.

The directors have made an assessment of the group and the company’s ability to continue as a going concern and there is no reason to believe the businesses will not be going concerns in the year ahead.

The auditor is responsible for reporting on whether the group annual financial statements and separate annual financial statements of the company are fairly presented in all material respects, in accordance with the applicable financial reporting framework.

Approval of the group annual financial statements and the annual financial statements of the company

The group annual financial statements and the annual financial statements of the company were approved by the board of directors on 28 January 2015 and signed on its behalf by:

Responsibility StatementD I R E C T O R S ’

Barry Stuhler Rual Bornman Managing director Financial director

28 January 2015

DECLARATION BY COMPANY SECRETARYfor the year ended 31 December 2014

In terms of section 33(1) of the Companies Act 71 of 2008 (“the Act”), I certify that the company has lodged with the Registrar of Companies all such returns as are required of a public company in terms of this Act and that all such returns are true, correct and up to date.

Jonathan BighamCompany secretary

28 January 2015

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45

The audit committee is pleased to submit its report in compliance with section 94(7)(f ) of the Companies Act of South Africa. Details on the composition of the audit committee, frequency of meetings and attendance at meetings are set out in the board of directors’ section of the integrated report on page 8 and further details on the role of the audit committee are set out in the corporate governance review section on page 27.

EXECUTION OF THE FUNCTIONS OF THE AUDIT COMMITTEEThe audit committee has carried out its functions in terms of the applicable requirements of the Companies Act of South Africa, the audit committee charter as approved by the board and any other legal or regulatory responsibilities.

EXTERNAL AUDITORS The audit committee is satisfied that the external auditors are independent of the group. The audit committee considered information pertaining to the balance between fees received by the external auditors for audit and non-audit work for the group in 2014 and concluded that the nature and extent of non-audit fees do not present a threat to the external auditors’ independence. Furthermore, after obtaining confirmation and reviewing a report from the external auditors on all their relationships with the company that might reasonably have a bearing on the external auditors’ independence and the audit engagement partner’s objectivity, and the related safeguards and procedures, the audit committee has concluded that the external auditors’ independence was not impaired.

The audit committee approved the external auditors’ terms of engagement, scope of work, the annual fee and noted the applicable levels of materiality. Based on written reports submitted, the audit committee reviewed, with external auditors, the findings of their work and confirmed that all significant matters had been satisfactorily resolved. The audit committee is satisfied that the 2014 audit was completed without any restrictions on its scope.

The audit committee has satisfied itself as to the suitability of the external auditors for re-appointment for the ensuing year.

FINANCIAL STATEMENTS AND ACCOUNTING POLICIESThe audit committee has reviewed principles, policies and practices adopted in the preparation of financial statements for the 2014 financial year and, where necessary, has obtained appropriate explanations relating to such financial information included in the Integrated Report. The audit committee is satisfied that they are adequate and appropriate and that the financial statements comply with International Financial Reporting Standards and the Companies Act of South Africa.

The audit committee has applied its mind to the preparation and presentation of the integrated report and acknowledges its responsibility to ensure the integrity of the integrated report. The audit committee recommended the integrated report to the board for approval.

INTERNAL FINANCIAL CONTROLS AND THE FINANCE FUNCTIONThe audit committee has satisfied itself that no breakdown in accounting controls, procedures and systems has occurred during the year under review that could have a material impact on financial reporting.

The audit committee is also satisfied that the financial director, Rual Bornman, is sufficiently competent and that the finance function has adequate resources and expertise.

Chairman of the audit committee Protas Phili28 January 2015

Audit CommitteeR E P O R T O F T H E

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46


TO THE SHAREHOLDERS OF CAPITAL PROPERTY FUND LIMITEDWe have audited the consolidated and separate financial statements of Capital Property Fund Limited set out on pages 47 to 81, which comprise the statements of financial position as at 31 December 2014, and the statements of comprehensive income, statements of changes in equity and statements of cash flows for the year then ended, and the notes, comprising a summary of significant accounting policies and other explanatory information.

DIRECTORS’ RESPONSIBILITY FOR THE CONSOLIDATED FINANCIAL STATEMENTSThe company’s directors are responsible for the preparation and fair presentation of these consolidated and separate financial statements in accordance with International Financial Reporting Standards and the requirements of the Companies Act of South Africa, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

AUDITOR’S RESPONSIBILITYOur responsibility is to express an opinion on these consolidated and separate financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated and separate financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OPINIONIn our opinion, the consolidated and separate financial statements present fairly, in all material respects, the consolidated and separate financial position of Capital Property Fund Limited as at 31 December 2014, and its consolidated and separate financial performance and its consolidated and separate cash flows for the year then ended in accordance with International Financial Reporting Standards and the requirements of the Companies Act of South Africa.

OTHER REPORTS REQUIRED BY THE COMPANIES ACT As part of our audit of the financial statements for the year ended 31 December 2014, we have read the directors’ report, the audit committee’s report and the company secretary’s certificate for the purpose of identifying whether there are material inconsistencies between these reports and the consolidated and separate financial statements.

These reports are the responsibility of the respective preparers. Based on reading these reports we have not identified material inconsistencies between these reports and the consolidated and separate financial statements. However, we have not audited these reports and accordingly do not express an opinion on these reports.

Deloitte & Touche Registered AuditorsPer: Patrick KlebPartner

28 January 2015

National Executive: *LL Bam Chief Executive *AE Swiegers Chief Operating Officer * GM Pinnock Audit *DL Kennedy Risk Advisory *NB Kader Tax

TP Pillay Consulting *K Black Clients & Industries *JK Mazzocco Talent & Transformation *MJ Jarvis Finance *M Jordan Strategy S Gwala Managed

Services. *TJ Brown Chairman of the Board *MJ Comber Deputy Chairman of the Board

A full list of partners and directors is available on request * Partner and Registered Auditor

B-BBEE rating: Level 2 contributor in terms of the Chartered Accountancy Profession Sector Code

Member of Deloitte Touche Tohmatsu Limited

ReportI N D E P E N D E N T A U D I T O R ’ S

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at 31 December 2014

GROUP COMPANY

NoteDec 2014

R’000Dec 2013

R'000Dec 2014

R'000

ASSETS

NON-CURRENT ASSETS 27 494 955 22 118 799 10 343 847Investment property 3 15 943 483 15 241 095 - Straight-lining of rental revenue adjustment 3 367 317 399 104 - Investment property under development 3 1 450 386 1 045 365 - Investments 4 6 090 753 3 824 693 - Investment in associate company 5 2 416 717 1 608 542 - Capital incentive scheme loans 6 199 244 - - Loans to BEE vehicle 7 1 027 055 - - Interest in subsidiaries 8 - - 10 343 847

CURRENT ASSETS 461 909 473 173 9 648 749 Investment property held for sale 3 63 361 183 286 - Straight-lining of rental revenue adjustment 3 639 1 306 - Capital incentive scheme loans 6 5 946 - - Trade and other receivables 9 383 881 261 056 - Owing by subsidiaries 8 - - 9 648 266 Cash and cash equivalents 10 8 082 27 525 483

TOTAL ASSETS 27 956 864 22 591 972 19 992 596

EQUITY AND LIABILITIES

TOTAL EQUITY ATTRIBUTABLE TO EQUITY HOLDERS 20 364 487 16 575 133 18 112 884 Stated capital 11 11 022 684 9 273 620 18 943 818 Non-distributable reserves 12 - 7 301 513 - Reserves/retained earnings 9 341 803 - (830 934)

TOTAL LIABILITIES 7 592 377 6 016 839 1 879 712

NON-CURRENT LIABILITIES 5 830 222 3 707 238 1 017 794 Interest-bearing borrowings 13 5 621 636 3 693 171 1 017 794 Deferred tax 14 208 586 14 067 -

CURRENT LIABILITIES 1 762 155 2 309 601 861 918 Trade and other payables 15 440 235 653 929 2 396 Unitholders for distribution - 643 437 - Taxation payable - 2 488 - Interest-bearing borrowings 13 1 321 920 1 009 747 858 517 Owing to subsidiaries 8 - - 1 005

TOTAL EQUITY AND LIABILITIES 27 956 864 22 591 972 19 992 596

Financial PositionS T A T E M E N T S O F

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48


Comprehensive IncomeS T A T E M E N T S O F

GROUP COMPANY

NoteDec 2014

R’000Dec 2013

R'000Dec 2014

R'000

NET RENTAL AND RELATED REVENUE 1 320 088 1 592 019 - Recoveries and contractual rental revenue 16 2 070 701 2 057 585 - Straight-lining of rental revenue adjustment (32 454) 245 887 - Rental revenue 2 038 247 2 303 472 - Property operating expenses (718 159) (711 453) -

INCOME FROM INVESTMENTS 197 413 193 901 -

FAIR VALUE GAIN ON INVESTMENT PROPERTY INVESTMENTS AND CURRENCY DERIVATIVES 2 220 658 1 405 741 -

Fair value gain on investment property 250 172 813 418 - Adjustment resulting from straight-lining of rental revenue 32 454 (245 887) - Fair value gain on investments 2 049 197 990 673 - Fair value loss on currency derivatives (111 165) (152 463) -

Gain on disposal of portion of associate - 39 353 -Loss on surety (90 000) - -Amortisation of management contract 17 (749 000) - (749 000)REIT conversion costs (7 714) - (7 714)Administrative expenses (68 512) (92 975) (2 400)Income from associate 212 968 102 248 - - non-distributable 94 701 44 302 - - distributable 118 267 57 946 -

PROFIT/(LOSS) BEFORE NET FINANCE COSTS 18 3 035 901 3 240 287 (759 114)

NET FINANCE COSTS (146 234) (56 331) (71 820) Finance income 276 572 276 886 -

Interest received 127 700 43 416 - Fair value adjustment on interest rate derivatives 121 122 233 470Interest on shares issued to Resilient - internalisation of PFM 27 750 -

Finance costs (422 806) (333 217) (71 820)Interest paid on borrowings (472 660) (415 352) (71 820)Capitalised interest 112 933 82 135 - Fair value adjustment on interest rate derivatives (63 079) - -

PROFIT/(LOSS) BEFORE INCOME TAX 2 889 667 3 183 956 (830 934)

Income tax 19 (191 367) 642 545 -

PROFIT/ (LOSS) FOR THE YEAR ATTRIBUTABLE TO EQUITY HOLDERS 2 698 300 3 826 501 (830 934)

TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR 2 698 300 3 826 501 (830 934)

Basic earnings per share (cents)* 158,95 238,12

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Profit for the year to Headline Earningsfor the year ended 31 December 2014

R E C O N C I L I A T I O N O F

GROUPDec 2014

R'000Dec 2013

R'000

Basic earnings - profit for the year attributable to equity holders 2 698 300 3 826 501 Adjusted for: (282 925) (1 201 684)

- Fair value gain on investment property (250 172) (813 418)- Adjustment resulting from straight-lining of rental revenue (32 454) 245 887 - Income tax effect (299) (634 153)

Headline earnings 2 415 375 2 624 817

Headline earnings per share (cents)* 142,28 163,34

Basic earnings per share and headline earnings per share are based on the weighted average of 1 697 604 010 (Dec 2013: 1 606 986 279) shares in issue during the period.

* Capital has no dilutionary instruments in issue.

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50


Changes in EquityS T A T E M E N T S O F

GroupStated capital

R’000

Non- distributable

reserves R’000

Reserves/ retained earnings

R’000Total

R’000

Balance at 31 December 2012 9 273 620 4 690 215 - 13 963 835

Total comprehensive income for the year 3 826 501 3 826 501

Transfer to non-distributable reserves 2 611 298 (2 611 298) -

Distribution (1 215 203) (1 215 203)

Balance at 31 December 2013 9 273 620 7 301 513 - 16 575 133

Total comprehensive income for the year 2 698 300 2 698 300

Issue of shares - 70 754 717 on 30 June 2014 749 333 749 333

Issue of shares - 83 333 333 on 6 October 2014 999 731 999 731

Transfer from non-distributable reserves (7 301 513) 7 301 513 -

Distribution (658 010) (658 010)

Balance at 31 December 2014 11 022 684 - 9 341 803 20 364 487

CompanyStated capital

R’000

Non- distributable

reserves R’000

Reserves/ retained earnings

R’000Total

R’000

Balance at 31 December 2013

Total comprehensive loss for the year (830 934) (830 934)

Issue of shares - 1 606 986 279 on 30 June 2014 17 194 754 17 194 754

Issue of shares - 70 754 717 on 30 June 2014 749 333 749 333

Issue of shares - 83 333 333 on 6 October 2014 999 731 999 731

Balance at 31 December 2014 18 943 818 - (830 934) 18 112 884

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GROUP COMPANY

NoteDec 2014

R’000Dec 2013

R'000Dec 2014

R'000

OPERATING ACTIVITIESCash generated from/(used in) operations 20.1 1 291 665 1 701 017 (7 718)Interest paid on borrowings (472 660) (415 352) (71 820)Interest received 127 700 43 416 - Distributions paid 20.2 (1 301 447) (1 158 316) (658 010)Income tax 20.3 664 (77 034) - Cash (outflow)/inflow from operating activities (354 078) 93 731 (737 548)

INVESTING ACTIVITIESAdditions to investment property (283 353) (93 000) - Developments and improvement to investment property (561 386) (391 102) - Proceeds on disposal of investment property 217 601 1 167 325 - Proceeds on disposal of investments 755 843 584 390 - Acquisition of investments (1 607 074) (1 853 942) - Cash flow on currency derivative (195 270) (82 226) - Proceeds on disposal of portion of associate - 303 435 - Loans advanced (1 232 245) - - Acquistion of investment - internalisation of PFM 20.4 817 - - Increase in loans to subsidiaries - - (826 224)Cash outflow from investing activities (2 905 067) (365 120) (826 224)

FINANCING ACTIVITIESIncrease in interest-bearing borrowings 2 240 638 284 861 565 191 Raising of share capital 999 064 - 999 064 Cash inflow from financing activities 3 239 702 284 861 1 564 255

(DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS (19 443) 13 472 483

Cash and cash equivalents at beginning of year 27 525 14 053 -

Cash and cash equivalents at end of year 10 8 082 27 525 483

Cash FlowsS T A T E M E N T S O F

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52


Annual Financial StatementsN O T E S T O T H E

1. ACCOUNTING POLICIES Capital Property Fund Limited (the “company”) is a

company domiciled in South Africa. The consolidated financial statements of the company for the year ended 31 December 2014 comprise the company, its subsidiaries and associates (together referred to as the “group”). There are no comparatives for the company as it was established during the 2014 financial year.

The directors authorised the issue of the financial statements on 28 January 2015.

1.1 Basis of preparation The company financial statements and group financial

statements have been prepared on the historical cost basis modified for the fair value adjustment of investment property and financial assets and financial liabilities measured in terms of IAS 39. The financial statements have been prepared on the going concern basis. They are presented in rand, which is the group and company’s functional currency, and all values are rounded to the nearest thousand (R’000) except where otherwise indicated. The accounting policies have remained unchanged from those applied in the prior year.

1.2 Statement of compliance The company financial statements and group financial

statements are prepared in accordance with International Financial Reporting Standards (“IFRS”) and interpretations of these standards as adopted by the Independent Accounting Standards Board, the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council, the requirements of the South African Companies Act, 2008 (“the Act”) and the Listings Requirements of the JSE Limited.

The principal accounting policies applied in the preparation of these financial statements are set out below. The accounting policies have been applied consistently by group entities. This report was compiled under the supervision of Rual Bornman CA(SA), the financial director. These financial statements have been audited in compliance with all applicable requirements of the Act.

1.3 Use of estimates and judgements The preparation of financial statements in conformity with

IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgements about

carrying amounts of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or the period of the revision and future periods if the revision affects both current and future periods.

Judgements made by management in the application of IFRS that have a significant effect on the financial statements and estimates with a significant risk of material adjustment in the next year are set out in note 29.

1.4 Basis of consolidation

Subsidiaries The consolidated annual financial statements incorporate

the annual financial statements of the company and entities controlled by the company and its’ subsidiaries.

Control is achieved when the company:

• has power over the investee;

• is exposed, or has rights, to variable returns from its involvement with the investee; and

• has the ability to use its power to affect its returns.

The company reassesses whether or not it controls an investee if the facts and circumstances indicate that there are changes to one or more of the three elements of control listed above.

When the company has less than a majority of the voting rights of an investee, it has power over the investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The company considers all relevant facts and circumstances in assessing whether or not the company’s voting rights in an investee are sufficient to give it power, including:

• the size of the company’s holding of voting rights relative to the size and dispersion of holdings of the other vote holders;

• potential voting rights held by the company, other vote holders or other parties;

• rights arising from other contractual arrangements; and

• any additional facts and circumstances that indicate that the company may have the current ability to direct the relevant activities at the time that decisions need to be made.

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The results of subsidiaries are included from the date control was acquired up to the date control ceased. The purchase method of accounting has been adopted to account for the cost of the acquisition of the investments. Cost comprises the fair value of any assets transferred, liabilities or obligations assumed and equity instruments issued and excludes transaction costs.

Investments in subsidiaries of the company are reflected at cost less accumulated impairment losses.

Intercompany transactions, balances and unrealised gains/losses on transactions between group companies are eliminated in the preparation of the consolidated annual financial statements.

The accounting policies of the subsidiaries are consistent with those of the company.

Associates An associate is an entity over which the group has significant

influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over these policies.

Associates are accounted for using the equity method. Under the equity method, an investment in an associate is initially recognised in the consolidated statement of financial position at cost and adjusted thereafter to recognise the group’s share of the profit or loss and other comprehensive income of the associate.

The consolidated financial statements include the group’s share of the income and expenses and equity movements of equity-accounted investees, after adjustments to align the accounting policies with those of the group, from the date that significant influence commences until the date that significant influence ceases. When the group’s share of losses exceeds its interest in an equity-accounted investee, the carrying amount of that interest (including any long-term investments) is reduced to nil and the recognition of further losses is discontinued except to the extent that the group has an obligation or has made payments on behalf of the investee.

Unrealised gains on transactions between the group and associates are eliminated to the extent of the group’s interest in the associates. Unrealised losses are also eliminated unless the transaction provides evidence of impairment in the investment in the associates. The investments in associates are accounted for at cost less accumulated impairment in the company.

1.5 Investment property

Investment property Investment property is property held to earn rental income

and for capital appreciation.

The cost of investment property comprises the purchase price and directly attributable expenditure. Subsequent expenditure relating to investment property is capitalised when it is probable that there will be future economic benefits from the use of the asset. All other subsequent expenditure is recognised as an expense in the period in which it is incurred.

After initial recognition, investment property is measured at fair value. Fair values are determined annually by external independent registered valuers on the open market value basis. The valuers use either the discounted cash flow method or the capitalisation of net income method or a combination of both methods to determine fair value. Gains or losses arising from changes in the fair values of investment property are included in profit or loss for the year in which they arise. The unrealised gain or loss is transferred to or from reserves/retained earnings.

Immediately prior to disposal of investment property, the investment property is revalued to the net sales proceeds and such revaluation is recognised in profit or loss in the period during which it occurs.

When the group begins to redevelop an existing investment property, consideration is given to whether or not the property needs to be reclassified as investment property under development or should remain as investment property, which is measured based on the fair value model.

Investment property under development Investment property under development comprises the cost

of the land and development and is stated at cost as the fair value of the developments cannot be reliably measured. On completion, property under development is transferred to investment property, where it is measured at fair value.

All costs directly associated with the purchase and construction of a property, and all subsequent capital expenditure for development qualifying as acquisition costs, are capitalised.

Borrowing costs are capitalised to the extent that they are directly attributable to the acquisition, construction or production of a qualifying asset. Capitalisation of borrowing costs commences when the activities to prepare the asset are in progress and expenditures and borrowing costs are being incurred. Capitalisation of borrowing costs may continue until the asset is substantially ready for its intended use.

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54

If the resulting carrying amount of the asset exceeds its recoverable amount, an impairment loss is recognised. The capitalisation rate is arrived at by reference to the actual rate payable on borrowings for development purposes or, with regard to that part of development cost financed out of general funds, the weighted average cost of borrowings.

Leased property Leases in terms of which the group assumes substantially

all the risks of ownership are classified as finance leases. The property acquired by way of finance lease is stated at an amount equal to the lower of its fair value and the present value of future minimum lease payments at inception of the lease.

Property held under finance leases and leased out under operating leases is classified as investment property and stated at fair value.

Leases in terms of which the group does not assume substantially all risks and rewards of ownership are classified as operating leases.

1.6 Reserves/retained earnings All unrealised gains/losses arising from the movements in

fair value of investment property, fair value adjustments on investments, derivatives, post-acquisition reserves from associates, gains and losses on the sale of investment property and investments are transferred to/from reserves/retained earnings and are not available for distribution.

1.7 Financial instruments The group’s financial instruments consist mainly of

investments, trade and other receivables, trade and other payables, cash and borrowings.

Financial instruments, other than financial instruments classified as fair value through profit and loss, are initially measured at fair value including transaction costs.

Subsequent to initial recognition these instruments are measured as set out below:

Cash and cash equivalents - Carried at amortised cost.

Investments - Carried at fair value, being the quoted closing price at

the reporting date, through profit and loss.

Trade and other receivables - Stated at amortised cost using the effective interest

rate method less accumulated impairment losses.

Trade and other payables - Stated at amortised cost using the effective interest

rate method.

Loans receivable - Stated at amortised cost using the effective interest

rate method less accumulated impairment losses.

Loans payable - Stated at amortised cost using the effective interest

rate method.

Financial liabilities - Non-derivative financial liabilities not at fair value

through profit and loss are recognised at amortised cost using the effective interest rate method.

For all financial instruments carried at amortised cost, where the financial effect of the time value of money is not considered to be material, discounting is not applied as the fair values of these instruments approximate their carrying values.

1.7.1 Derecognition

Financial assets A financial asset (or, where applicable, a part of a financial

asset or part of a group of similar financial assets) is derecognised where:

• the contractual rights to receive cash flows from the asset have expired;

• the group retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party under a “pass-through” arrangement; or

• the group has transferred its rights to receive cash flows from the asset and either:

(a) has transferred substantially all the risks and rewards of the asset, or (b) has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

Where the group has transferred its rights to receive cash flow from an asset and has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the extent of the group’s continuing involvement in the asset. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the group could be required to repay.

The difference between the carrying amount and any cash received on derecognition is recognised in profit or loss.

for the year ended 31 December 2014 (continued)

Annual Financial StatementsN O T E S T O T H E

1.5 Investment property (continued)

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Financial liabilities A financial liability is derecognised when the obligation

under the liability is discharged or cancelled or expires. Where an existing liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in profit or loss.

Offset Financial assets and financial liabilities are offset and the

net amount reported in the statement of financial position when the company has a legally enforceable right to set off the recognised amounts, and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

1.7.2 Derivative financial instruments The group uses derivative financial instruments to hedge its

exposure to interest rate risks arising from financing activities and currency risks resulting from its offshore investments in listed property securities. In accordance with its treasury policy, the group does not hold or issue derivative financial instruments for trading purposes.

Derivative financial instruments are recognised initially and subsequently stated at fair value. The gain or loss on remeasurement to fair value is recognised immediately in profit or loss. Directly attributable transaction costs are recognised in profit or loss when incurred.

The fair value of derivatives is the estimated amount that the group would receive or pay to terminate the derivative at the reporting date, taking into account relevant interest rates and exchange rates and the creditworthiness of the counterparties.

1.7.3 Cash and cash equivalents Cash and cash equivalents comprise cash balances and call

deposits. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value. Bank overdrafts that are repayable on demand and that form an integral part of the group’s cash management are included as a component of cash and cash equivalents for the purpose of the statements of cash flows.

1.7.4 Interest-bearing borrowings Interest-bearing borrowings are recognised initially at fair

value less attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated

at amortised cost with any difference between cost and redemption value being recognised in the statement of comprehensive income over the period of the borrowings on an effective interest basis.

1.8 Assets held for sale Immediately before classification as held for sale, the

measurement of assets is brought up to date in accordance with the applicable IFRS. Then, on initial classification as held for sale, non-current assets, excluding investment property and financial assets within the scope of IAS 39, are recog-nised at the lower of the carrying amount and fair value less costs to sell.

1.9 Impairment

Non-financial assets The carrying amounts of the group’s non-financial assets are

reviewed at each reporting date to determine whether there is any indication of impairment.

If any such indication exists, the asset’s recoverable amount is estimated.

An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount and is recognised in profit or loss.

Impairment losses recognised are allocated first to reduce the carrying amount of any goodwill allocated to the cash-generating unit and then to reduce the carrying amounts of the other assets in the unit on a pro rata basis.

The recoverable amount of an asset or a cash-generating unit is the greater of its fair value less costs to sell and its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For any asset that does not generate largely independent cash flows, the recoverable amount is determined for the cash-generating unit to which the asset belongs.

An impairment loss in respect of goodwill is not reversed. In respect of other assets, an impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount and there is an indication that the impairment loss no longer exists.

An impairment loss is reversed and recognised in profit or loss only to the extent that the carrying amount of the asset does not exceed the carrying amount that would have been determined, net of depreciation, if no impairment loss had been recognised.

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1.9 Impairment (continued)

Financial assets A financial asset is considered to be impaired if objective

evidence indicates that one or more events have had a negative effect on the estimated future cash flows of that asset. An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. An impairment loss in respect of an available for sale financial asset is calculated by reference to its current fair value.

Individually significant financial assets are tested for impairment on an individual basis. The remaining financial assets are assessed collectively in groups that share similar credit characteristics.

All impairment losses are recognised in profit or loss.

An impairment loss is reversed and recognised in profit or loss only to the extent that the carrying amount of the asset does not exceed the carrying amount that would have been determined had no impairment loss initially been recognised. An impairment loss is reversed if the subsequent increase in recoverable amount can be related objectively to an event occurring after the impairment loss was recognised.

1.10 Provisions Provisions are recognised when the group has present legal

or constructive obligations arising from past events, from which outflows of economic benefits are probable, and where the amount of the obligations can be reliably estimated. Where the effect of discounting is material, provisions are discounted. The discount rate is a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.

1.11 Revenue Revenue comprises gross rental revenue including all

recoveries from tenants, excluding VAT. Rental revenue from investment property is recognised in the statements of comprehensive income on a straight-line basis over the term of the lease. Lease incentives granted are recognised as an integral part of the total rental income. Turnover rentals are recognised on the accrual basis.

Dividend income is recognised when the right to receive payment is established.

1.12 Property operating expenses Service costs for service contracts entered into and property

operating expenses are expensed as incurred.

Lease payments Payments made under operating leases are recognised in

profit or loss on a straight-line basis over the term of the lease.

1.13 Net financing costs Finance costs comprise interest payable on borrowings

calculated using the effective interest rate method.

Finance income comprises interest received and is recog-nised as it accrues, taking into account the effective yield on the asset.

1.14 Income tax Income tax on the profit or loss for the year comprises current

and deferred tax. Income tax is recognised in profit or loss except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the statement of financial postion date, and any adjustment to tax payable in respect of previous years.

To the extent that the current tax is due to the tax authorities at year end, it is recognised as a current liability.

Deferred tax is provided using the statement of financial position method, based on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their tax bases. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the statement of financial position date.

The following temporary differences are not provided for: goodwill not deductible for tax purposes, the initial recognition of assets or liabilities that affect neither accounting nor taxable profit, and differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

1.15 Segmental reporting A segment is a distinguishable component of the group that is

engaged either in providing services (business segment), or in providing services within a particular economic environment (geographical segment), which is subject to risks and returns that are different from those of other segments. The group’s primary segment is based on business segments. There are no

Annual Financial StatementsN O T E S T O T H Efor the year ended 31 December 2014 (continued)

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secondary segments. The business segments are determined based on the group’s management and internal reporting structure.

On a primary basis, the group operates in the following segments:

• logistics; • industrial; • retail; • offices; and • other.

The group will from time to time invest in/divest from certain primary segments, in which case segmental reporting will be adjusted to reflect only the relevant operating segments.

Segment results include revenue and expenses directly attributable to a segment and the relevant portion of group revenue and expenses that can be allocated on a reasonable basis to a segment. Segmental assets comprise those assets that are directly attributable to the segment or can be allocated to the segment on a reasonable basis.

1.16 Related parties Related parties in the case of the group include any

shareholder who is able to exert a significant influence on the operating policies of the group. Directors, their close family members and any employee who is able to exert a significant influence on the operating policies of the group are also considered to be related parties.

In the case of the company, related parties would also include subsidiaries and associates.

1.17 Earnings per share The group presents basic earnings per share and headline

earnings per shares for its shares

Basic earnings per share is calculated by dividing the profit attributable to equity holders by the weighted average number of shares in issue during the year.

Headline earnings per share is calculated by dividing the headline earnings attributable to equity holders by the weighted average number of shares in issue during the year.

There are no dilutionary instruments in issue.

2. FINANCIAL RISK MANAGEMENT The group has exposure to the following risks from its use of

financial instruments:

• credit risk; • liquidity risk; and • market risk.

This note presents information about the group’s exposure to each of the above risks, the group’s objectives, policies and processes for measuring and managing risk, as well as the group’s management of capital. Further quantitative disclosures are included throughout these consolidated financial statements.

The board of directors has overall responsibility for the establishment and oversight of the group’s risk management framework. The board has delegated the responsibility for developing and monitoring the group’s risk management policies to the risk committee. The risk committee reports to the board of directors on its activities. The risk committee oversees how management monitors compliance with the group’s risk management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced by the group.

The group’s risk management policies are established to identify and analyse the risks faced by the group, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the group’s activities.

2.1 Credit risk Credit risk is the risk of financial loss to the group if a tenant

or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the group’s receivables from tenants and investment securities.

Trade and other receivables The group’s exposure to credit risk is influenced mainly by the

individual characteristics of each customer. The demographics of the group’s customer base, including its industry and geographical spread, reduces credit risk. The majority of rental income is derived from Gauteng and KwaZulu-Natal, but within these areas, there is no concentration of credit risk.

Management has established a credit policy under which each new customer is analysed individually for creditworthiness before the group’s standard payment terms and conditions are offered. When available, the group’s review includes external ratings.

In monitoring customer credit risk, customers are grouped according to their credit characteristics, including whether they are an individual or a legal entity, industry, size of business and existence of previous financial difficulties. Trade and other receivables relate mainly to the group’s tenants and deposits with municipalities.

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Investments The group limits its exposure to credit risk by only investing

in liquid securities and only with counterparties that are listed on a recognised stock exchange.

Cash and cash equivalents The group limits its exposure to credit risk by investing cash

and cash equivalents with reputable financial institutions.

Sureties The group’s policy is to provide sureties with regards to

group entities to the extent required in the normal course of business. Such sureties are provided to enable the subsidiaries to obtain the funding necessary to enable them to acquire investment property or investments.

2.2 Liquidity risk Liquidity risk is the risk that the group will not be able to meet

its financial obligations as they fall due. The group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the group’s reputation.

The group receives rental on a monthly basis and uses it to reduce its borrowings. Typically the group ensures that it has sufficient cash on demand to meet expected operational expenses, including the servicing of financial obligations. This excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.

2.3 Market risk Market risk is the risk that changes in market prices, such

as foreign exchange rates, interest rates and equity prices will affect the group’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

The group utilises derivatives, and also incurs financial liabilities, in order to manage market risks. All such transactions are carried out within the guidelines set by the risk committee.

Equity price risk The group is exposed to equity risk on its investments in

Fortress, Resilient, Nepi and Rockcastle. The group limits its exposure to equity price risk by only investing in liquid securities and only with counterparties that are listed on a recognised stock exchange.

Interest rate risk The group is exposed to interest rate risk on its interest-

bearing borrowings and cash and cash equivalents. Interest-bearing borrowings and cash and cash equivalents bear interest at rates linked to prime/Jibar.

The group adopts a policy of ensuring that at least 80 percent of its exposure to interest rates on borrowings is hedged. This is achieved by entering into interest rate derivatives.

Currency risk The group is exposed to currency risk through its investments

in Rockcastle and Nepi. The group utilises cross currency swaps to hedge its currency exposure. The group adopts a policy of maintaining cross currency swaps up to a maximum of 50% of its exposure.

2.4 Capital management The board’s policy is to maintain a strong capital base so as

to maintain investor, creditor and market confidence and to sustain future development of the business.

The board seeks to maintain a balance between the higher returns that might be possible with higher levels of borrowings and the advantages and security afforded by a sound capital position. The board also monitors the level of distributions to shareholders. There were no changes in the group’s approach to capital management during the year. Neither the company nor any of its subsidiaries are subject to externally imposed capital requirements.

Refer to note 27.2 detailing the limitation on borrowings.


2.1 Credit risk (continued)

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3. INVESTMENT PROPERTY, STRAIGHT-LINING OF RENTAL REVENUE ADJUSTMENT AND INVESTMENT PROPERTY UNDER DEVELOPMENT

GROUP

2014 R’000

2013 R’000

Investment in property comprises:

Investment property 15 943 483 15 241 095

Straight-lining of rental revenue adjustment 367 317 399 104

16 310 800 15 640 199

Investment property held for sale 63 361 183 286

Straight-lining of rental revenue adjustment 639 1 306

16 374 800 15 824 791

Investment property under development 1 450 386 1 045 365

Total investment property 17 825 186 16 870 156

Details of investment property are as follows:

At cost 9 823 012 9 554 731

Cumulative revaluation 6 183 832 5 869 650

Straight-lining of rental revenue adjustment 367 956 400 410

Investment property at fair value 16 374 800 15 824 791

Movement in investment property is as follows:

Carrying value at beginning of year 15 824 791 16 065 314

Additions - 66 500

Disposals (217 601) (1 413 367)

Capital expenditure 178 999 109 924

Transfer from investment property under development 415 064 284 499

Transfer to investment property under development (76 625) (101 497)

Fair value adjustment 282 626 567 531

Straight-lining of rental revenue adjustment (32 454) 245 887

16 374 800 15 824 791

Details of investment property under development are as follows:

Carrying value at beginning of year 1 045 365 870 009

Additions 283 353 26 500

Cost capitalised 347 174 249 723

Interest capitalised 112 933 82 135

Transfer to investment property (415 064) (284 499)

Transfer from investment property 76 625 101 497

1 450 386 1 045 365

Investment property with a market value of R10,372 million (2013: R8,581 million) is mortgaged to secure borrowing facilities (refer note 13).

All investment property is externally valued on an annual basis by Peter Parfitt of Quadrant Properties Proprietary Limited, a professional associated valuer (Dip Val MIV (SA)). The valuations were done on an open market basis and with consideration to the future earnings potential and an appropriate capitalisation rate for each property. The determined fair value of all investment property is supported by market evidence. The valuations provided by the external valuer have been recorded without adjustment.

Investment properties held for sale were valued at the net sale price, which is considered to be the fair value. The valuation of investment property is classified as a level 3 fair value measurement and there has been no transfer between levels in the current period (refer to note 29 for the estimates used and judgements made).

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4. INVESTMENTS

Group

2014 Resilient Property

Income FundLimited

2014

New EuropeProperty

Investments plc

2014

Fortress IncomeFund Limited

(B units)*

2014

Total

Holding 5.07% 8.70% 22.96%

Price at 31 December 83.99 114.00 17.52

R'000 R'000 R'000 R'000

Cost 581 469 2 000 727 319 201 2 901 397

Fair value adjustment 875 749 756 942 1 556 665 3 189 356

Total 1 457 218 2 757 669 1 875 866 6 090 753

Group

2013 Resilient Property

Income FundLimited

2013 New Europe

PropertyInvestments

plc

2013 Fortress Income

Fund Limited(A units)*

2013 Fortress Income

Fund Limited(B units)*

2013

Sub-total

Holding 5.52% 7.83% 6.47% 26.78%

Price at 31 December 55.50 81.00 14.70 9.15

R'000 R'000 R'000 R'000 R'000

Cost 474 887 1 225 270 238 100 197 162 2 135 419

Fair value adjustment 376 700 15 678 84 712 658 642 1 135 732

Accrued distribution 47 513 57 021 18 228 22 596 145 358

Total 899 100 1 297 969 341 040 878 400 3 416 509

2013 AscensionProperties

Limited(A units)**

2013 AscensionProperties

Limited(B units)**

2013

Delta Property

Fund Limited

2013

Tower Property

Fund Limited

2013

Sub-total

Holding 13.84% 12.12% 2.03% 3.52%

Price at 31 December 4.45 2.50 8.65 8.20

R'000 R'000 R'000 R'000 R'000

Cost 173 728 89 634 74 184 37 842 375 388

Fair value adjustment 6 192 17 833 (3 970) (9 349) 10 706

Accrued distribution 10 318 6 533 756 4 483 22 090

Total 190 238 114 000 70 970 32 976 408 184

Total

Cost 2 510 807

Fair value adjustment 1 146 438

Accrued distribution 167 448

Combined total 3 824 693

* The effective voting rights in Fortress are 0% (2013:3.24%) in Fortress A units and 11.48% (2013:13.39%) in Fortress B units.** The effective voting rights in Ascension were 13.84% in Ascension A units and 12.12% in Ascension B units.


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61

5. INVESTMENT IN ASSOCIATE COMPANY GROUP

Interest in associate company Rockcastle2014

R’0002013

R’000

Investment at cost 2 322 016 1 608 542

Share of post-acquisition reserves 94 701 -

Carrying value 2 416 717 1 608 542

Holding 21.39% 22.96%

Price at 31 December 2 420 1 400

Market value 3 984 900 1 703 871

The 2013 distributable income from Rockcastle has been accounted for under trade and other receivables (refer note 9).

Condensed consolidated statement of financial position *September 2014

USD’000June 2013

USD’000

Non-current assets 1 575 693 645

Equity (896 228) (401 360)

Non-current liabilities (243 243) (66 971)

Working capital 1 137 896 (225 314)

Condensed consolidated statement of comprehensive income *

Quarter ended September 2014

USD’000

Year ended June 2013

USD’000

Revenue 9 872 17 736

Profit/(loss) before net finance income 164 792 (2 499)

Net finance (cost)/income (22 174) 671

Profit/(loss) before income tax expense 142 618 (1 828)

Income tax expense (607) (198)

Profit/(loss) for the year 142 011 (2 026)

Rockcastle was incorporated on 30 March 2012 in Mauritius as a Category One Global Business License Company with the primary objective of investing globally in listed real estate assets and direct property in developed and developing markets. Rockcastle has been listed on the Stock Exchange of Mauritius Limited since 5 June 2012 and transferred its listing from the Alternative Exchange to the Main Board of the Johannesburg Stock Exchange on 25 November 2014.

Rockcastle has been accounted for using the equity method.

The group exercises significant influence over Rockcastle by virtue of the 21.39% (2013: 22.96%) equity and 21.39% (2013: 22.96%) voting rights held.

* The information was extracted from Rockcastle’s latest available published results for the quarter ended 30 September 2014 and its integrated report for the 15 months ended 30 June 2013 respectively.

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62

6. CAPITAL INCENTIVE SCHEME LOANS GROUP

2014R’000

2013 R’000

Incentive scheme loans (refer note 21)

- capital advanced 199 244 -

- interest accrued 5 946 -

205 190 -

The incentive scheme loans bear interest at the weighted average cost of funding of the group being 8.36% at year end. The loans are secured by 25 718 400 shares in Capital with a fair value of R341,5 million.

The value of security held for each individual loan exceeds the amount of the related loan. The loans are repayable on the tenth anniversary of the loans being granted.

7. LOANS TO BEE VEHICLE GROUP

2014 R’000

2013 R’000

Loan to The Siyakha Education Trust (BEE charitable trust) 1 027 055 -

1 027 055 -

The loan to The Siyakha Education Trust (BEE charitable trust) is unsecured and bears interest at prime plus 2%. The loan is repayable on 6 October 2024.

8. INTEREST IN SUBSIDIARIES

Company Effective interest InvestmentAmount owing

by / (to)

2014 R’000

2014R’000

2014 R’000

Capital Propfund (Pty) Ltd 100% 1 242 719 5 374 979

Capital Propfund 1 (Pty) Ltd 100% 320 157 1 536 739

Capital Propfund 2 (Pty) Ltd 100% 169 052 813 177

Capital Propfund 3 (Pty) Ltd *** 100% #

Capital Propfund 4 (Pty) Ltd **** 100% #

Property Fund Managers Limted 100% 1 000 (1 005)

Bands Properties (Pty) Ltd 100% 148 021 137 290

Monyetla Property Holdings (Pty) Ltd 100% 128 429 250 334

Pangbourne Properties Ltd 100% 8 334 469 1 535 747

Prime Realty Obligors Packaged Securities (Pty) Ltd 100% #

iFour Properties Ltd 100% #

iFour Properties SA (Pty) Ltd 100% #

iFour Properties Three (Pty) Ltd 100% #

Sipan 1 (Pty) Ltd 100% #

Siyathenga Properties Two (Pty) Ltd 100% #

Siyathenga Properties Three (Pty) Ltd 100% #


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63

Panhold (Pty) Ltd 100% #

Pangbourne Investments (Pty) Ltd* 100% #

Realty Dynamix 73 (Pty) Ltd 100% #

Caprohold (Pty) Ltd* 100% #

Port Ferry 48 (Pty) Ltd* 100% #

Combined Investments Four (Pty) Ltd* 100% #

Prepaid Direct (Pty) Ltd* $ $

Library Park Investments (Pty) Ltd* $ $

Inforced Property and Investments (Pty) Ltd* $ $

Ironmail Investments (Pty) Ltd* $ $

Raceway Industrial Park (Pty) Ltd $ $

Raceway Industrial Park Phase IV (Pty) Ltd $ $

Raceway Industrial Warehouse (Pty) Ltd* $ $

Caprohold 1 (Pty) Ltd* $ $

10 343 847 9 647 261

* Dormant*** Formerly Siyathenga Properties One (Pty) Ltd**** Formerly iFour Properties Two (Pty) Ltd# Share capital held through Pangbourne Properties Limited, a wholly-owned subsidiary.$ Entity liquidated during the year.

All subsidiaries are incorporated in South Africa. The principal business activity of all subsidiaries is the investment in real estate.

The amounts owing by/to subsidiaries are unsecured and bear interest at rates agreed from time to time and the terms of the repayment have not been determined. The directors do not intend to demand payment of the loans within 12 months.

9. TRADE AND OTHER RECEIVABLES GROUP

2014R’000

2013 R’000

Trade and other receivables include the following:

Tenant arrears 55 714 47 035

Municipal deposits 31 569 23 343

Property debtors 50 684 13 462

Interest rate derivative debtor 100 687 84 379

Currency derivative debtor 10 235 -

Distribution accrual from Rockcastle - 34 046

Other 134 992 58 791

383 881 261 056

8. INTEREST IN SUBSIDIARIES (continued)

Company Effective interest InvestmentAmount owing

by / (to)

2014 R’000

2014R’000

2014 R’000

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ATED

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201

4 C

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64

64

10. CASH AND CASH EQUIVALENTS GROUP COMPANY

2014R’000

2013 R’000

2014 R’000

Deposits at banks 8 082 27 525 483

8 082 27 525 483

11. STATED CAPITAL

GROUP 2014

GROUP 2013

COMPANY 2014

Number of shares in

issue R’000 Number of

units in issue

R’000

Number of shares in

issue

R’000

Stated capital 1 761 074 329 11 022 684 1 606 986 279 9 273 620 1 761 074 329 18 943 818

12. NON-DISTRIBUTABLE RESERVESIn the prior period, non-distributable reserves comprise those profits and losses that are not distributable to shareholders and are made up of revaluation adjustments on investment property, investments and other non-distributable balances. In the current year, all prior year non-distributable reserves were transferred to reserves/retained earnings.

13. INTEREST-BEARING BORROWINGS GROUP COMPANY

2014Nominal

interest rateDate of

maturityFair value

R’000

Carryingamount

R’000Fair value

R’000

Carryingamount

R’000

Standard Bank 3 month Jibar + 1,65% Oct 18 261 763 261 763 - -

Standard Bank Prime less 1,75% Oct 18 253 016 253 016 - -

Standard Bank Prime less 1,65% Jun 17 534 411 534 411 - -

Standard Bank 3 month Jibar + 1,40% Mar 17 352 296 352 296 - -

Standard Bank 3 month Jibar + 1,60% Mar 19 130 876 130 876 - -

Standard Bank Prime less 1,80% Mar 19 120 000 120 000 - -

Standard Bank 3 month Jibar + 1,30% Jun 17 301 942 301 942 - -

Standard Bank 3 month Jibar + 1,50% Jun 19 181 197 181 197 - -


Standard Bank 3 month Jibar + 1,50% Sep 19 241 618 241 618 - -

Standard Bank Prime less 1,65% Sep 19 60 000 60 000 - -


Nedbank Prime less 2,10% Dec 15 463 403 463 403 - -

Rand Merchant Bank 3 month Jibar + 1,75% Dec 18 753 380 753 380 - -

Rand Merchant Bank 3 month Jibar + 1,75% Mar 20 753 380 753 380 - -

Rand Merchant Bank 3 month Jibar + 1,70% Dec 19 401 791 401 791 - -

Rand Merchant Bank 1 month Jibar + 1,80% Aug 17 85 000 85 000 - -

Rand Merchant Bank Prime less 1,50% Aug 17 1 574 1 574 - -


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65

Commercial Paper 3 month Jibar + 0,38% Apr 15 253 212 253 212 253 212 253 212

3-Year Bond 3 month Jibar + 1,65% Nov 17 112 736 112 736 112 736 112 736

3-Year Bond 3 month Jibar + 1,60% Mar 15 352 284 352 284 352 284 352 284

3-Year Bond 3 month Jibar + 1,40% Aug 15 253 021 253 021 253 021 253 021

3-Year Bond 3 month Jibar + 1,40% Aug 17 403 034 403 034 403 034 403 034

5-Year Bond 3 month Jibar + 1,75% Feb 17 201 459 201 459 201 459 201 459

5-Year Bond 3 month Jibar + 1,55% Sep 19 300 565 300 565 300 565 300 565

6 943 556 6 943 556 1 876 311 1 876 311

Less short-term portion (1 321 920) (1 321 920) (858 517) (858 517)

5 621 636 5 621 636 1 017 794 1 017 794

2013 GROUP

Nominal interest rate

Date ofmaturity

Fair valueR’000

Carrying amountR’000

Standard Bank 3 month Jibar + 1,65% Oct 18 260 000 260 000

Standard Bank Prime less 1,75% Oct 18 130 400 130 400

Standard Bank Prime less 1,65% Jun 17 360 000 360 000

Standard Bank Prime less 1,50% Jun 17 70 998 70 998

Nedbank Prime less 2,10% Dec 15 462 687 462 687

Rand Merchant Bank 3 month Jibar + 1,58% Dec 16 1 064 981 1 064 981

Rand Merchant Bank 1 month Jibar + 1,58% Aug 17 487 689 487 689

Rand Merchant Bank Prime less 1,72% Aug 17 50 425 50 425

Commercial Paper 3 month Jibar + 0,25% Apr 14 252 833 252 833

Commercial Paper 3 month Jibar + 0,22% Apr 14 253 853 253 853

3-Year Bond 3 month Jibar + 1,60% Nov 14 503 070 503 070

3-Year Bond 3 month Jibar + 1,60% Mar 15 351 956 351 956

3-Year Bond 3 month Jibar + 1,40% Aug 15 252 733 252 733

5-Year Bond 3 month Jibar + 1,75% Feb 17 201 293 201 293

4 702 918 4 702 918

Less short-term portion (1 009 747) (1 009 747)

3 693 171 3 693 171

Interest-bearing borrowings are measured at amortised cost. The Group’s exposure to liquidity and interest rate risk is discussed in notes 27.2 and 27.3.

The bank loans are secured over investment property with a carrying amount of R10,372 million (2013: R8,581 million).

13. INTEREST-BEARING BORROWINGS (continued) GROUP COMPANY

2014Nominal interest rate

Date ofmaturity

Fair valueR’000

Carryingamount

R’000Fair value

R’000

Carryingamount

R’000

INTE

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201

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66

66

13. INTEREST-BEARING BORROWINGS (continued) Investment property

R’000

Interest-bearing borrowings are secured by the following:

Group 2014

Standard Bank (1), (2), (3), (4) 4 204 200

Rand Merchant Bank (2), (4), (5), (6), (7) 5 159 450

Nedbank (2), (8) 1 008 000

10 371 650

Group 2013

Standard Bank (1), (2), (3), (4) 2 951 400

Rand Merchant Bank (2), (4), (5), (6), (7) 4 658 613

Nedbank (2), (8) 970 600

8 580 613

The financial assets have been pledged under the following terms:(1) - The loan to value ratio shall not exceed 70%.(2) - The total debt for Capital shall not exceed 50% of total assets.(3) - The ratio of earnings before interest tax depreciation and amortisation (“EBITDA”) with reference to the secured properties to gross

interest payable on the facility shall not be less than 1.3 times.(4) - The ratio of EBITDA to gross interest payable on all borrowings shall not be less than 2 times.(5) - The Capital group must maintain a net asset value of at least R8 billion.(6) - The loan to value shall not exceed 50%.(7) - The ratio of EBITDA with reference to the secured properties to gross interest payable on the facility shall not be less than 1.75 times.(8) - The ratio of EBITDA with reference to the secured properties to gross interest payable on the facility shall not be less than 1.5 times.

14. DEFERRED TAX GROUP

2014R’000

2013 R’000

Deferred tax comprises the following:

- Revaluation of investment property 20 221 15 272

- Revaluation of investments 189 117 4 390

- Revaluation of interest rate derivatives (752) (5 595)

208 586 14 067

Carrying value at beginning of year 14 067 736 134

Charged/credited to the statement of comprehensive income during the year 194 519 (722 067)

Carrying value at end of year 208 586 14 067

Deferred tax is provided at 18,6% (2013: 18,6%) on investment property and at 28% (2013: 28%) on investments and interest rate derivatives. The group has unutilised assessed losses of R117,849 million.


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15. TRADE AND OTHER PAYABLES GROUP COMPANY

2014R’000

2013 R’000

2014 R’000

Trade and other payables include the following:

Tenant deposits 95 719 87 188 -

Currency derivative creditor 43 800 117 670 -

Interest rate derivative creditor 49 401 85 608 -

Pre-payment received on disposal of property - 115 980 -

Accruals and other payables 251 315 247 483 2 396

440 235 653 929 2 396

16. RECOVERIES AND CONTRACTUAL RENTAL REVENUE GROUP

2014R’000

2013 R’000

Revenue consists of gross rentals and recoveries 2 070 701 2 057 585

17. AMORTISATION OF MANAGEMENT CONTRACTCapital effectively acquired the contract that entitled PFM to manage Capital Trust. As this was a re-acquired intangible asset in terms of IFRS 3 and had no contractual period, it was amortised in full.

18. PROFIT/(LOSS) BEFORE NET FINANCE COSTS GROUP COMPANY

2014R’000

2013 R’000

2014 R’000

Profit/(loss) before net finance costs is stated after charging:

- Auditors' remuneration - audit services (1 410) (2 000) (40)

- Asset management fee* (41 097) (85 751) -

Directors' remuneration**

- Services as director (non-executive) (1 352) - -

- Other services (executive) (6 687) - -

- Other costs (17 966) (5 224) (2 360)

Administrative expenses (68 512) (92 975) (2 400)

- Impairment charge (8 857) (14 011) -

- Expenditure relating to income producing properties (659 403) (647 233) -

- Fees for managerial services (49 899) (50 209) -

Property expenses relating to income producing properties (718 159) (711 453) -

* The asset management fee was equal to 0.4% per annum of the company’s market capitalisation and borrowing facilities and a pro rata portion was payable on a monthly basis. Post internalisation the asset management fee was no longer payable. The market capitalisation was based on the closing bid price of the shares as quoted on the JSE Limited.

** Refer to the remuneration report on pages 17 and 18 for a detailed breakdown.

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68

68

19. INCOME TAX GROUP

2014R’000

2013 R’000

South African normal tax

- current tax current year (362) 3 720

- capital gains tax 3 514 (83 242)

- deferred tax (194 519) 722 067

Income tax per the statement of comprehensive income (191 367) 642 545

GROUP

2014R’000

2013 R’000

Reconciliation of tax rate

Standard tax rate 28.0% 28.0%

Permanent differences - REIT (28.3%) -

Exemption for qualifying REIT dividend (5.4%) -

Permanent differences 22.3% -

Tax rate differential - REIT conversion - (25.5%)

Capital gains tax differential (0.1%) (1.5%)

Exempt income from Capital Trust and other (9.9%) (21.2%)*

Effective tax rate 6.6% (20.2%)

* A significant portion of this adjustment relates to exempt income from Capital Trust.

20. NOTES TO THE STATEMENTS OF CASH FLOWS

20.1 Cash generated from/(used in) operations

GROUP COMPANY

2014R’000

2013 R’000

2014 R’000

Profit before income tax expense 2 889 667 3 183 956 (830 934)

Adjusted for:

Straight-lining of rental revenue adjustment 32 454 (245 887) -

Fair value gain on investment property (250 172) (813 418) -

Adjustment resulting from straight-lining of rental revenue (32 454) 245 887 -

Fair value gain on investments (2 049 197) (990 673) -

Fair value loss on currency derivatives 111 165 152 463

Gain on disposal of portion of associate - (39 353) -

IFRS scrip received in lieu of dividends (79 106) - -


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69

Income from associate - non-distributable (94 701) (44 302) -

Amortisation of management contract 749 000 - 749 000

Interest received (127 700) (43 416) -

Interest paid on borrowings 472 660 415 352 71 820

Capitalised interest (112 933) (82 135) -

Fair value adjustment on interest rate derivatives (58 043) (233 470) -

Amortisation of tenant installation 20 473 18 157 -

Amortisation of letting commission 14 740 13 298 -

1 485 853 1 536 459 (10 114)

Changes in working capital

Increase in trade and other receivables 9 003 285 470 -

(Decrease)/increase in trade and other payables (203 191) (120 912) 2 396

1 291 665 1 701 017 (7 718)

20.2 Distributions paid

GROUP COMPANY

2014R’000

2013 R’000

2014 R’000

Amounts unpaid at the beginning of the year 643 437 586 550

Amounts declared during the year 658 010 1 215 203 658 010

Amounts unpaid at the end of the year - (643 437)

1 301 447 1 158 316 658 010

20.3 Income tax

GROUP COMPANY

2014R’000

2013 R’000

2014 R’000

Income tax at beginning of year 2 488 - -

(Charged)/credited to statement of comprehensive income during the year (3 152) 79 522 -

Income tax at end of year - (2 488) -

(664) 77 034 -

20.1 Cash generated from/(used in) operations (continued)

GROUP COMPANY

2014R’000

2013 R’000

2014 R’000

INTE

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201

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70

70

20.4 Acquisition of investment - internalisation of PFM

GROUP COMPANY

2014R’000

2013 R’000

2014 R’000

Trade and other receivables 471 - -

Cash and cash equivalents 817 - -

Intangible asset: management contract 749 000 - 749 000

Interest-bearing borrowings - - (1 311 120)

Investment in and loans to subsidiaries - - 19 164 884

Trade and other payables (288) - (658 010)

750 000 - 17 944 754

Consideration shares issued (750 000) - (17 944 754)

- - -

Cash and cash equivalents received 817 - -

Cash flow effect 817 - - Effective 30 June 2014, Capital Trust disposed of all of its assets and liabilities to Capital in consideration for shares in Capital, which shares were issued directly to Capital Trust’s unitholders on behalf of Capital. Unitholders in Capital Trust became direct shareholders in Capital. Capital secured a listing by way of an introduction in the “Industrial and Office REIT’s” section of the JSE. The transaction was therefore treated as a reverse acquisition in terms of IFRS 3.

21. CAPITAL INCENTIVE SCHEMEShareholders adopted the Capital Share Purchase Scheme on 9 April 2014 which was included in the pre-listing statement issued to Capital unitholders on 9 May 2014.

In terms of the rules of the Scheme the maximum number of shares which may be granted to the participants shall be limited to 83 887 050 shares.

December 2014

% of issued shares

Number of shares

Maximum shares available to the scheme 4.8% 83 887 050

Issued to the scheme through loan account 1.5% (25 718 400)

Previously issued to the Scheme repaid and not available for reissue 0.1% (1 275 600)

Shares available but unissued (56 893 050)

The participants in the scheme carry the risk associated with the shares issued to them.

Capital internalised its asset management function and assumed responsibility for its staff incentivisation and all staff loans were therefore taken over by Capital on 30 June 2014 from Resilient.


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71

21. CAPITAL INCENTIVE SCHEME (continued)

GroupNumber of

sharesAverage price

Rand

Employee asset asrecorded in the scheme

R’000

As at 31 December 2014 details of the shares granted to directors, taken over from Resilient on 30 June 2014, are as follows:

Barry Stuhler 7 084 000 6.78 48 045

Rual Bornman 1 100 000 8.71 9 577

David Lewis 1 000 000 10.21 10 206

Andrew Teixeira 4 880 000 7.13 34 797

Fareed Wania 1 038 000 8.55 8 875

22. CAPITAL COMMITMENTS GROUP

2014 R’000

2013 R’000

Authorised and contracted 426 259 606 695

Authorised and not yet contracted 25 275 40 542

451 534 647 237

The expenditure relates to property developments and extensions to properties and will be funded by borrowings and/or the sale of non- core properties.

23. OPERATING LEASE RENTALS GROUP

2014R’000

2013 R’000

Contractual rental revenue from tenants can be analysed as follow:

Within one year 1 446 300 1 330 243

Within two to five years 2 646 880 2 167 653

More than five years 1 093 131 830 006

5 186 311 4 327 902

The group leases its properties under operating leases. Leases typically run for a period of three to five years.

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72

72

24. OPERATING LEASE COMMITMENTS GROUP

2014R’000

2013 R’000

Operating lease commitments can be analysed as follows:

Within one year 1 849 1 975

Within two to five years 5 268 7 148

More than five years 207 652 317 168

214 769 326 291

The land leases above will be funded from the proceeds of rental revenue from the properties which form part of the lease agreements. The above commitments exclude any option periods. The land leases run for periods in excess of 20 years and the group has the option to renew. Leases escalate between 7% and 10%.

25. SEGMENTAL REPORTING

GroupOffices

R’000Industrial

R’000Logistics

R’000RetailR’000

OtherR’000

CorporateR’000

TotalR’000

Segmental statement of financial position at 31 December 2014

Investment property 4 330 222 437 555 9 259 473 1 784 730 131 503 - 15 943 483

Straight-lining of rental revenue adjustment 63 407 7 817 47 566 127 430 121 097 - 367 317

Investment property under development 163 997 - 1 286 389 - - - 1 450 386

Investments - - - - - 6 090 753 6 090 753

Investment in associate company - - - - - 2 416 717 2 416 717

Capital incentive scheme loans - - - - - 205 190 205 190

Loans to BEE vehicle - - - - - 1 027 055 1 027 055

Investment property held for sale - - 63 361 - - - 63 361

Straight-lining of rental revenue adjustment - - 639 - - - 639

Trade and other receivables 47 240 8 681 112 219 25 432 - 190 309 383 881

Cash and cash equivalents - - - - - 8 082 8 082

Total assets 4 604 866 454 053 10 769 647 1 937 592 252 600 9 938 106 27 956 864

Trade and other payables 95 392 14 129 183 249 42 404 5 315 99 746 440 235

Additions to investment property - - 283 353 - - - 283 353

All other equity and liabilites are classified as corporate.


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25. SEGMENTAL REPORTING (continued)

GroupOffices

R’000Industrial

R’000Logistics


OtherR’000

CorporateR’000

TotalR’000

Segmental statement of comprehensive income for the year ended 31 December 2014

Recoveries and contractual rental revenue 559 219 74 944 1 160 714 250 736 25 088 - 2 070 701

Straight-lining of rental revenue adjustment (14 622) (2 515) 14 951 (6 874) (23 394) - (32 454)

External segmental revenue 544 597 72 429 1 175 665 243 862 1 694 - 2 038 247

Property operating expenses (189 171) (42 862) (381 244) (101 488) (3 394) - (718 159)

Net rental and related revenue 355 426 29 567 794 421 142 374 (1 700) - 1 320 088

Income from investments - - - - - 197 413 197 413

Fair value gain on investment property net of adjustment resulting from straight-lining of rental revenue (17 526) (122 194) 282 373 97 185 42 788 - 282 626

Fair value gain on investments - - - - - 2 049 197 2 049 197

Fair value loss on currency derivatives - - - - - (111 165) (111 165)

Loss on surety - - - - - (90 000) (90 000)

Amortisation of management contract - - - - - (749 000) (749 000)

REIT convertion costs - - - - - (7 714) (7 714)

Administrative expenses - - - - - (68 512) (68 512)

Income from associate - - - - - 212 968 212 968

Net finance costs - - - - - (146 234) (146 234)

Income tax - - - - - (191 367) (191 367)

Profit for the year attributable to equity holders 337 900 (92 627) 1 076 794 239 559 41 088 1 095 586 2 698 300

Segmental statement of financial position at 31 December 2013

Investment property 4 441 104 351 014 8 643 269 1 712 829 92 879 - 15 241 095

Straight-lining of rental revenue adjustment 48 154 6 550 108 798 93 981 141 621 - 399 104

Investment property under development - 1 045 365 - - - 1 045 365

Investments - - - - - 3 824 693 3 824 693

Investments in associate companies - - - - - 1 608 542 1 608 542

Investment property held for sale 44 633 138 653 - - - - 183 286

Straight-lining of rental revenue adjustment 1 283 23 - - - - 1 306

Trade and other receivables 33 520 7 944 88 723 34 293 1 672 94 904 261 056

Cash and cash equivalents - - - - - 27 525 27 525

Total assets 4 568 694 504 184 9 886 155 1 841 103 236 172 5 555 664 22 591 972

Trade and other payables 212 635 13 277 156 491 37 764 7 877 225 885 653 929

Additions to investment property 66 500 66 500

All other equity and liabilites are classified as corporate.

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25. SEGMENTAL REPORTING (continued)

GroupOffices

R’000Industrial

R’000Logistics


OtherR’000

CorporateR’000

TotalR’000

Segmental statement of comprehensive income for the year ended 31 December 2013

Recoveries and contractual rental revenue 589 648 90 532 1 080 005 270 256 27 144 - 2 057 585

Straight-lining of rental revenue adjustment 22 637 (3 596) 40 281 57 686 128 879 - 245 887

External segmental revenue 612 285 86 936 1 120 286 327 942 156 023 - 2 303 472

Property operating expenses (193 067) (48 702) (359 781) (103 288) (6 615) - (711 453)

Net rental and related revenue 419 218 38 234 760 505 224 654 149 408 - 1 592 019

Distributable income from investments - - - - - 193 901 193 901

Fair value gain on investment property net of adjustment resulting from straight-lining of rental revenue 156 463 (10 766) 476 231 47 235 (101 632) - 567 531

Fair value gain on investments - - - - - 990 673 990 673

Fair value loss on currency derivatives - - - - - (152 463) (152 463)

Gain on disposal of portion of associate - - - - - 39 353 39 353

Administrative expenses - - - - - (92 975) (92 975)

Income from associates - - - - - 102 248 102 248

Net finance costs - - - - - (56 331) (56 331)

Income tax expense - - - - - 642 545 642 545

Profit for the year attributable to equity holders 575 681 27 468 1 236 736 271 889 47 776 1 666 951 3 826 501

26. SUBSEQUENT EVENTSThe directors are not aware of any other events subsequent to 31 December 2014, not arising in the normal course of business, which are likely to have a material effect on the financial information contained in this report.

27. FINANCIAL INSTRUMENTS

27.1 Credit riskThe carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the reporting date was:

GROUP COMPANY

2014R’000

2013 R’000

2014 R’000

Capital incentive scheme loans 205 190 -

Loans to BEE vehicle 1 027 055 -

Trade and other receivables 383 881 261 056 -

Cash and cash equivalents 8 082 27 525 483

Owing by subsidiaries - - 9 648 266

Gross exposure 1 624 208 288 581 9 648 749

Shares pledged as security (341 540) - -

Tenant arrears covered by deposits (18 872) (17 294) -

Net exposure 1 263 796 271 287 9 648 749


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27.1 Credit risk (continued)The ageing of trade receivables at the reporting date was less than 90 days. All amounts past due and irrecoverable are impaired in full. At 31 December 2014 debtors past due were Rnil (2013: Rnil).

The Group believes that no impairment allowance is necessary in respect of trade receivables as a comprehensive analysis of outstanding amounts are performed on a regular basis and impairment losses are accounted for timeously. Doubtful amounts are impaired when recoverability is in question.

27.2 Liquidity riskThe maturity of the undiscounted contractual financial liabilities excluding the impact of netting agreements are as follows:

Carrying valueR’000

Contractual outflows

R’0001-12 months

R’0001-2 years

R’0002-5 years

R’000

GROUP

2014

Non-derivative financial liabilities

Secured and unsecured loans - capital 6 943 556 9 694 608 1 780 429 2 961 067 4 953 112

Trade and other payables 347 034 347 034 347 034

2013


Secured bank loans - capital 4 702 918 6 828 203 1 363 961 1 775 804 3 688 438


COMPANY

2014


Secured and unsecured loans - capital 1 876 311 2 751 290 1 004 347 1 008 889 738 054


Owing to subsidiaries 1 005 1 005 1 005

Cash flows are monitored on a regular basis to ensure that cash resources are adequate to meet funding requirements.

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27.3 Interest rate risk GROUP COMPANY

2014R’000

2013 R’000

2014 R’000

Interest-bearing instruments comprise:

Variable rate instruments

Capital incentive scheme loans (205 190) - -

Loans to BEE vehicles (1 027 055) - -

Cash and cash equivalents (8 082) (27 525) (483)

Interest-bearing borrowings 6 943 556 4 702 918 1 876 311

5 703 229 4 675 393 1 875 828

The Group adopts a policy of ensuring that at least 80% of its exposure to interest rates on borrowings is hedged.

Details of existing interest rate derivatives are:

GROUP 2014Swap

maturityNominal amount

R’000 Average swap rateFair value

R’000

Dec 2016 200 000 7.50% (2 783)

Dec 2017 700 000 7.22% (4 444)

Dec 2018 500 000 7.12% (559)

Dec 2019 600 000 6.40% 20 775

Dec 2020 600 000 7.43% (1 787)

Dec 2021 600 000 8.02% (16 004)

Dec 2022 400 000 7.98% (8 124)

Dec 2023 200 000 7.47% 4 188

Dec 2024 100 000 7.78% 714

3 900 000 7.36% (8 024)

CAPmaturity

Nominal amountR’000 Average CAP rate

Fair valueR’000

Dec 2019 200 000 7.39% 6 276

Dec 2021 200 000 7.33% 11 987

Dec 2022 200 000 7.46% 14 058

Dec 2023 400 000 7.98% 26 989

1 000 000 7.63% 59 310


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27.3 Interest rate risk (continued)

GROUP 2013Swap

maturityNominal amount

R’000 Average swap rateFair value

R’000

Dec 2015 300 000 7.68% (7 845)

Dec 2016 600 000 8.11% (23 050)

Dec 2017 700 000 7.22% (5 673)

Dec 2018 800 000 7.68% (15 497)

Dec 2019 600 000 6.40% 30 114

Dec 2020 400 000 7.27% 7 849

Dec 2021 200 000 7.65% 995

3 600 000 7.40% (13 107)

Capmaturity

Nominal amountR’000 Average CAP rate

Fair valueR’000

Dec 2019 200 000 7.39% 11 878

200 000 7.39% 11 878

Capital pays the fixed rate and receives the 3 month Jibar floating rate on interest rate swaps. Interest rate CAPs provides Capital with protection against rising interest rates. The maximum base rate payable by Capital will be the CAP rate.

Effective interest rates and repricing The effective interest rates at the statement of financial position date and the periods in which the borrowings reprice are reflected in note 13.

Cash flow sensitivity analysis for variable rate instruments

A change of 100 basis points in interest rates at the reporting date would have increased/(decreased) equity and profit or loss by the amounts shown below.

This analysis assumes that all other variables remain constant.

GROUP 2014

Profit or loss100 basis point

increase


decrease

Interest-bearing borrowings (69 436) 69 436

Hedged borrowings 49 000 (49 000)

Cash flow sensitivity (net) (20 436) 20 436

GROUP 2013


increase


decrease

Interest-bearing borrowings (47 029) 47 029

Hedged borrowings 38 000 (38 000)

Cash flow sensitivity (net) (9 029) 9 029

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This analysis assumes that all other variables remain constant.

Profit or loss and equity

GROUP 2014 1% increase 1% decrease

Investments 60 908 (60 908)

GROUP 2013 1% increase 1% decrease

Investments 38 247 (38 247)

27.4 Fair valuesThe fair values of all financial instruments are substantially the same as the carrying amounts reflected on the statement of financial position.

At fair value through

profit and loss

R’000

Loans and receivables

R’000

Financial liabilities at

amortised cost

R’000

Total carrying amount

R’000Fair value

R’000

GROUP 2014

Cash and cash equivalents - 8 082 - 8 082 8 082

Interest-bearing borrowings - - (6 943 556) (6 943 556) (6 943 556)

Trade and other receivables - 272 959 - 272 959 272 959

Interest rate derivative debtor - level 2 100 687 - - 100 687 100 687

Interest rate derivative creditor - level 2 (49 401) - - (49 401) (49 401)

Currency derivative debtor - level 2 10 235 - - 10 235 10 235

Currency derivative creditor - level 2 (43 800) - - (43 800) (43 800)

Trade and other payables - - (347 034) (347 034) (347 034)

Investments - level 1 6 090 753 - - 6 090 753 6 090 753

6 108 474 281 041 (7 290 590) (901 075) (901 075)

GROUP 2013

Cash and cash equivalents - 27 525 - 27 525 27 525

Interest-bearing borrowings - - (4 702 918) (4 702 918) (4 702 918)

Trade and other receivables - 176 677 - 176 677 176 677

Interest rate derivative debtor - level 2 84 379 - - 84 379 84 379

Interest rate derivative creditor - level 2 (85 608) - - (85 608) (85 608)

Currency derivative creditor - level 2 (117 670) - - (117 670) (117 670)

Trade and other payables and unitholders for distribution - - (1 094 088) (1 094 088) (1 094 088)

Investments - level 1 3 824 693 - - 3 824 693 3 824 693

3 705 794 204 202 (5 797 006) (1 887 010) (1 887 010)

Level 1 financial instruments are all investments in listed equities. Interest rate and currency derivatives have been classified as level 2 financial instruments and have been fair valued externally.


27.3 Interest rate risk (continued)Equity prices A one percent change in the market value of investments would have increased/(decreased) equity and profit or loss by the amounts shown below.

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28. CONTINGENT LIABILITIESThe last of the eight legal disputes relating to contracts entered into by previous Pangbourne Properties Limited management has been finalised. The arbitration appeal relating to the Coveway Trade and Invest 17 Proprietary Limited matter was upheld against Pangbourne on 17 July 2014. At 31 December 2014 there are no contingent liabilities.

29. ACCOUNTING ESTIMATES AND JUDGEMENTSManagement discusses with the audit committee the development, selection and disclosure of the group’s critical accounting policies and estimates and the application of these policies and estimates.

Investment propertyThe valuation of investment property requires judgement in the determination of future cash flows and an appropriate capitalisation rate which vary between 8.25% and 13.00% (2013: 8.50% and 13.00%). Changes in the capitalisation rate attributable to changes in market conditions can have a significant impact on property valuations.

A 25 basis points increase in the capitalisation rate will decrease the value of investment property by R431,9 million (2013: R411,0 million). A 25 basis points decrease in the capitalisation rate will increase the value of investment property by R455,6 million (2013: R444,4 million).

Impairment of assetsThe Group tests whether assets have suffered any impairment in accordance with the accounting policy stated in note 1. The recoverable amounts of cash-generating units have been determined based on future cash flows discounted to their present value using appropriate rates. Estimates are based on interpretation of generally accepted industry based market forecasts.

Trade receivablesManagement identifies impairment of trade receivables on an ongoing basis. Impairment adjustments are raised against trade receivables when the collectability is considered to be doubtful. Management believes that the impairment write-off is conservative and there are no significant trade receivables that are doubtful and have not been written off. In determining whether a particular receivable could be doubtful, the following factors are taken into consideration:

• age;

• customer current financial status;

• security held; and

• disputes with customer.

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30. RELATED PARTY TRANSACTIONSParent entityThe holding entity of the subsidiaries is Capital Property Fund Limited.

Identity of related parties with whom material transactions have occurredThe subsidiaries of the company are identified in note 8 of these financial statements. These entities are related parties of the company.

GROUP

2014R’000

2013R’000

Management company

Asset management fee paid to PFM 41 097 85 751

Material related party transactions (other than the transaction as disclosed in the pre-listing statement and circular issued on 9 May 2014.

Subsidiaries

Owing by/(to) subsidiaries - refer note 8

Remuneration paid to directors is set out on pages 17 and 18 and in note 18.

Loans to directors by a subsidiary of Capital for purposes of the Capital share incentive scheme are set out in note 21.

Interest paid by directors to a subsidiary of Capital in terms of the Capital share incentive scheme.

31. RECLASSIFICATION In order to improve disclosure, the December 2013 results were reclassified to disclose the fair value loss on currency derivatives separately. Consequently, fair value gain on investments increased by R82,226 million, fair value adjustment on derivatives increased by R70,237 million and a fair value loss on currency derivatives of R152,463 million was recognised and consequently R34,357 million was reclassified from interest paid to interest received.

32. STANDARDS

32.1 Standards not yet effectiveThe Group applies all applicable IFRSs as issued by the International Accounting Standards Board (“IASB”) in preparation of the financial statements. Consequently, all IFRS statements that were effective at the date of issuing this report and are relevant to Capital’s operations have been applied.

At the date of authorisation of these financial statements, the following Standards were in issue but not yet effective:

IFRS 1First-time Adoption of International Financial Reporting Standards

• Amendments resulting from 2012-2014 Annual Improvements CycleAnnual periods beginning on or after 1 January 2016

IFRS 3Business Combinations

• Amendments resulting from Annual Improvements 2010-2012 Cycle (accounting for contingent consideration)

Annual periods beginning on or after 1 July 2014

IFRS 3Business Combinations

• Amendments resulting from Annual Improvements 2011-2013 Cycle (scope exception for joint ventures)


IFRS 5Non-current Assets Held for Sale and Discontinued Operations


IFRS 7Financial Instruments: Disclosures

• Deferral of mandatory effective date of IFRS 9 and amendments to transition disclosures

Annual periods beginning on or after 1 January 2015


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IFRS 7Financial Instruments: Disclosures

• Amendments resulting from September 2014 Annual Improvements to IFRSs


IFRS 8Operating Segments

• Amendments resulting from Annual Improvements 2010-2012 Cycle (aggregation of segments, reconciliation of segment assets)


IFRS 9Financial Instruments

• Reissue of a complete standard with all the chapters incorporatedAnnual periods beginning on or after 1 January 2018

IFRS 10Consolidated Financial Statements

• Amendments on Sale or Contribution of Assets between an investor and its associate or joint venture


IFRS 11

Joint Arrangements

• Amendment requiring the acquirer of an interest in a joint operation in which the activity constitutes a business, as defined in IFRS 3 Business Combinations, to apply all of the principles on business combinations accounting in IFRS 3


IFRS 13Fair Value Measurement

• Amendments resulting from Annual Improvements 2011-2013 Cycle (scope of the portfolio exception in paragraph 52)


IFRS 14Regulatory Deferral Accounts

• Original issueAnnual periods beginning on or after 1 January 2016

IFRS 15 Revenue from contracts with customers

• Original issueAnnual periods beginning on or after 1 January 2017

IAS 16Property, Plant and Equipment

• Amendments resulting from Annual Improvements 2010-2012 Cycle (proportionate restatement of accumulated depreciation on revaluation)



• Amendments resulting from clarification of acceptable methods of depreciation and amortisation (Amendments to IAS 16 and IAS 38)



• Amendments to include ‘bearer plants’ within the scope of IAS 16 rather than IAS 41


IAS 24 Related Party Disclosures

• Amendments resulting from Annual Improvements 2010-2012 Cycle (management entities)


IAS 27Separate Financial Statements

• Amendments relating to equity method in separate financial statementsAnnual periods beginning on or after 1 January 2016

IAS 28Investments in Associates and Joint Ventures

• Amendments on Sale or Contribution of Assets between an investor and its associate or joint venture


IAS 34Interim Financial Reporting


IAS 38Intangible Assets

• Amendments resulting from Annual Improvements 2010-2012 Cycle (proportionate restatement of accumulated depreciation on revaluation)


IAS 38Intangible Assets

• Amendments resulting from clarification of acceptable methods of depreciation and amortisation (Amendments to IAS 16 and IAS 38)


IAS 40Investment Property

• Amendments resulting from Annual Improvements 2011-2013 Cycle (interrelationship between IFRS 3 and IAS 40)


Management is currently assessing the impact of these standards on the financial statements.

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Property name Address Province Sector GLA (m2) Valuation

R'000 Purchase price

R'000 Effective date of acquisition Rental per m2 Vacancy

1 Otto Volek Road Pinetown 22 Otto Volek Road Pinetown KwaZulu-Natal Industrial 18 296 77 800 16 557 Aug-04 41.20 -

2 14 Fitzmaurice Avenue Epping 2 14 Fitzmaurice Avenue Epping 2 Western Cape Industrial 11 873 77 600 25 238 Nov-10 48.50 -

3 Essex Street Tunney Essex Street Tunney Gauteng Industrial 12 814 59 500 49 100 Apr-11 @ -

4 Anvil Road Robertville Anvil Road Robertville Gauteng Industrial 25 045 56 000 68 800 Apr-11 34.99 -

5 Lanzerac Estate Midrand Old Pretoria Road Halfway House Gauteng Industrial 8 848 40 000 43 800 Apr-11 49.45 -

6 5 Bertie Avenue Epping 2 5 Bertie Avenue Epping 2 Western Cape Industrial 5 500 27 600 15 000 Nov-10 45.00 -

7 Rutland Mews 30 Main Street Eastleigh Edenvale Gauteng Industrial 4 405 19 800 11 648 Nov-06 47.79 8.0%

8 York Road Wynberg Cape Town York Road Wynberg Cape Town Western Cape Industrial 2 514 10 900 10 500 Dec-08 @ -

Total industrial 89 295 369 200 240 643

9 Isando Business ParkCnr Andre Greyvenstein Avenue and Hulley Road and Vanacht Street and 14 Skietlood Street Kempton Park Gauteng Logistics 56 517 318 000 256 000 Aug-09 51.86 4.4%

10 Silverstone Raceway Silverstone Street Raceway Industrial Park Gauteng Logistics 40 796 275 000 179 322 Jul-14 # -

11 City Deep Industrial Park Cnr Outspan Road and Fortune Street Johannesburg Gauteng Logistics 56 816 264 700 191 000 Aug-09 40.42 22.5%

12 118 Brakpan Road 118 Brakpan Road Boksburg Gauteng Logistics 37 027 239 800 215 800 Apr-11 # -

13 Mirabel Road Pomona Mirabel Road Pomona Gauteng Logistics 31 856 194 000 147 200 Apr-11 53.73 -

14 Jonas Road Germiston Jonas Road Elandsfontein Germiston Gauteng Logistics 36 924 182 000 169 500 Apr-11 41.14 -

15 12 Platinum Road Longmeadow 12 Platinum Road Longmeadow Gauteng Logistics 17 456 168 200 138 400 Apr-11 # -

16 Catalunya Crescent Raceway Catalunya Crescent Raceway Industrial Park Gauteng Logistics 21 491 162 300 98 020 Jul-13 # -

17 N1 Business Park * N1 Highway Midrand Gauteng Logistics 87 216 161 600 147 172 Aug-06 58.76 -

18 Surprise Park Pinetown Surprise Road Pinetown KwaZulu-Natal Logistics 25 216 150 400 13 000 Aug-04 51.58 -

193 - 4 Drakensberg Drive Longmeadow 3 - 4 Drakensberg Drive Longmeadow Gauteng Logistics 15 614 141 000 107 666 Mar-10 # -

20 1 Setchel Road Roodekop 1 Setchel Road Roodekop Gauteng Logistics 33 925 141 000 98 000 Apr-11 # -

21 6 Prospecton Road Prospecton 6 Prospecton Road Prospecton KwaZulu-Natal Logistics 24 370 139 100 121 800 Apr-11 53.02 4.5%

22 Tradeport City Deep Merino Avenue City Deep Gauteng Logistics 43 613 139 100 153 000 Apr-11 48.18 46.0%

23 60 North Reef Road Elandsfontein 60 North Reef Road Elandsfontein Germiston Gauteng Logistics 24 686 133 500 84 400 Apr-11 # -

24 Tillbury Business Park Midrand 1030 Sixteenth Road Randjespark Gauteng Logistics 26 610 128 000 112 600 Apr-11 47.61 6.9%

25 Jan Smuts Park Jet Park Jones Road Jet Park Gauteng Logistics 25 416 125 400 110 500 Apr-11 46.73 2.8%

26 Montague Business Park**Cnr Plattekloof and Koeberg Road Milnerton Cape Town Western Cape Logistics 63 113 123 000 119 751 Aug-09 63.43 4.9%

27 31 Jeffels Road Prospecton 31 Jeffels Road Prospecton KwaZulu-Natal Logistics 20 088 120 600 94 000 Dec-10 49.95 -

28 Maple Road Pomona Maple Road Pomona Gauteng Logistics 19 594 117 000 72 300 Apr-11 51.11 -

29 1 Keerom Road Heriotdale 1 Keerom Road Heriotdale Gauteng Logistics 18 834 105 200 76 800 Apr-11 # -

30 15th Road Midrand 15th Road Midrand Gauteng Logistics 14 308 104 600 24 640 Aug-04 60.56 -

31 Noursepack Epping 2 Nourse Avenue Epping 2 Western Cape Logistics 17 768 102 000 6 591 Aug-84 50.85 -

32 11 Fitzmaurice Epping 11 Fitzmaurice Epping Western Cape Logistics 19 381 101 500 23 000 Aug-04 47.73 -

33 Mahogany Road Undoni Crescent Mahogany Ridge Pinetown KwaZulu-Natal Logistics 16 209 100 200 65 000 May-09 54.06 -

34 154 Monteer Road Isando 154 Monteer Road Isando Gauteng Logistics 22 445 100 000 60 600 Apr-11 # -

35 Palisades Business Park Jet Park 39 Kelly Road Jet Park Gauteng Logistics 18 465 100 000 83 000 Apr-11 49.35 -

36 Lakeview Business Park Yaldwyn Road Jet Park Gauteng Logistics 17 182 99 820 87 530 Apr-11 55.80 -

PropertiesS C H E D U L E O F

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1 Otto Volek Road Pinetown 22 Otto Volek Road Pinetown KwaZulu-Natal Industrial 18 296 77 800 16 557 Aug-04 41.20 -

2 14 Fitzmaurice Avenue Epping 2 14 Fitzmaurice Avenue Epping 2 Western Cape Industrial 11 873 77 600 25 238 Nov-10 48.50 -

3 Essex Street Tunney Essex Street Tunney Gauteng Industrial 12 814 59 500 49 100 Apr-11 @ -

4 Anvil Road Robertville Anvil Road Robertville Gauteng Industrial 25 045 56 000 68 800 Apr-11 34.99 -

5 Lanzerac Estate Midrand Old Pretoria Road Halfway House Gauteng Industrial 8 848 40 000 43 800 Apr-11 49.45 -

6 5 Bertie Avenue Epping 2 5 Bertie Avenue Epping 2 Western Cape Industrial 5 500 27 600 15 000 Nov-10 45.00 -

7 Rutland Mews 30 Main Street Eastleigh Edenvale Gauteng Industrial 4 405 19 800 11 648 Nov-06 47.79 8.0%

8 York Road Wynberg Cape Town York Road Wynberg Cape Town Western Cape Industrial 2 514 10 900 10 500 Dec-08 @ -

Total industrial 89 295 369 200 240 643

9 Isando Business ParkCnr Andre Greyvenstein Avenue and Hulley Road and Vanacht Street and 14 Skietlood Street Kempton Park Gauteng Logistics 56 517 318 000 256 000 Aug-09 51.86 4.4%

10 Silverstone Raceway Silverstone Street Raceway Industrial Park Gauteng Logistics 40 796 275 000 179 322 Jul-14 # -

11 City Deep Industrial Park Cnr Outspan Road and Fortune Street Johannesburg Gauteng Logistics 56 816 264 700 191 000 Aug-09 40.42 22.5%

12 118 Brakpan Road 118 Brakpan Road Boksburg Gauteng Logistics 37 027 239 800 215 800 Apr-11 # -

13 Mirabel Road Pomona Mirabel Road Pomona Gauteng Logistics 31 856 194 000 147 200 Apr-11 53.73 -

14 Jonas Road Germiston Jonas Road Elandsfontein Germiston Gauteng Logistics 36 924 182 000 169 500 Apr-11 41.14 -

15 12 Platinum Road Longmeadow 12 Platinum Road Longmeadow Gauteng Logistics 17 456 168 200 138 400 Apr-11 # -

16 Catalunya Crescent Raceway Catalunya Crescent Raceway Industrial Park Gauteng Logistics 21 491 162 300 98 020 Jul-13 # -

17 N1 Business Park * N1 Highway Midrand Gauteng Logistics 87 216 161 600 147 172 Aug-06 58.76 -

18 Surprise Park Pinetown Surprise Road Pinetown KwaZulu-Natal Logistics 25 216 150 400 13 000 Aug-04 51.58 -

193 - 4 Drakensberg Drive Longmeadow 3 - 4 Drakensberg Drive Longmeadow Gauteng Logistics 15 614 141 000 107 666 Mar-10 # -

20 1 Setchel Road Roodekop 1 Setchel Road Roodekop Gauteng Logistics 33 925 141 000 98 000 Apr-11 # -

21 6 Prospecton Road Prospecton 6 Prospecton Road Prospecton KwaZulu-Natal Logistics 24 370 139 100 121 800 Apr-11 53.02 4.5%

22 Tradeport City Deep Merino Avenue City Deep Gauteng Logistics 43 613 139 100 153 000 Apr-11 48.18 46.0%

23 60 North Reef Road Elandsfontein 60 North Reef Road Elandsfontein Germiston Gauteng Logistics 24 686 133 500 84 400 Apr-11 # -

24 Tillbury Business Park Midrand 1030 Sixteenth Road Randjespark Gauteng Logistics 26 610 128 000 112 600 Apr-11 47.61 6.9%

25 Jan Smuts Park Jet Park Jones Road Jet Park Gauteng Logistics 25 416 125 400 110 500 Apr-11 46.73 2.8%

26 Montague Business Park**Cnr Plattekloof and Koeberg Road Milnerton Cape Town Western Cape Logistics 63 113 123 000 119 751 Aug-09 63.43 4.9%

27 31 Jeffels Road Prospecton 31 Jeffels Road Prospecton KwaZulu-Natal Logistics 20 088 120 600 94 000 Dec-10 49.95 -

28 Maple Road Pomona Maple Road Pomona Gauteng Logistics 19 594 117 000 72 300 Apr-11 51.11 -

29 1 Keerom Road Heriotdale 1 Keerom Road Heriotdale Gauteng Logistics 18 834 105 200 76 800 Apr-11 # -

30 15th Road Midrand 15th Road Midrand Gauteng Logistics 14 308 104 600 24 640 Aug-04 60.56 -

31 Noursepack Epping 2 Nourse Avenue Epping 2 Western Cape Logistics 17 768 102 000 6 591 Aug-84 50.85 -

32 11 Fitzmaurice Epping 11 Fitzmaurice Epping Western Cape Logistics 19 381 101 500 23 000 Aug-04 47.73 -

33 Mahogany Road Undoni Crescent Mahogany Ridge Pinetown KwaZulu-Natal Logistics 16 209 100 200 65 000 May-09 54.06 -

34 154 Monteer Road Isando 154 Monteer Road Isando Gauteng Logistics 22 445 100 000 60 600 Apr-11 # -

35 Palisades Business Park Jet Park 39 Kelly Road Jet Park Gauteng Logistics 18 465 100 000 83 000 Apr-11 49.35 -

36 Lakeview Business Park Yaldwyn Road Jet Park Gauteng Logistics 17 182 99 820 87 530 Apr-11 55.80 -

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37 12 - 18 Elliot Avenue, Epping 2 12 - 18 Elliot Avenue, Epping 2 Western Cape Logistics 20 725 97 200 66 500 Mar-13 38.83 -

38 9 Galaxy Avenue Linbro Park 9 Galaxy Avenue Linbro Park Gauteng Logistics 13 499 96 200 73 800 Apr-11 # -

39 Harries Street Germiston Cnr Harries and Sigma Roads Germiston South Gauteng Logistics 18 342 93 700 24 000 Aug-04 # -

40 Cambridge Commercial Park 22 Witkoppen Road Paulshof Gauteng Logistics 13 412 93 000 86 200 Apr-11 66.58 19.7%

41 Strijdom Commercial Park 123 Malibongwe Drive Strijdompark Gauteng Logistics 15 496 92 800 89 300 Apr-11 61.06 10.4%

42 2 Joyner Road Prospecton 2 Joyner Road Prospecton KwaZulu-Natal Logistics 17 354 91 200 70 000 Apr-11 # -

43 City Deep Hi-tech Outspan Road City Deep Gauteng Logistics 18 125 89 000 46 000 Sep-07 45.62 -

44 Chemserve Spartan 3 Johann Birkart Road Kempton Park Gauteng Logistics/Industrial 14 905 88 400 67 500 Aug-09 51.90 32.8%

45 Waterpas Street Isando Waterpas Street Isando Gauteng Logistics/Office 14 717 88 400 63 300 Apr-11 54.56 -

46 38 Isando Road Isando 38 Isando Road Isando Gauteng Logistics 19 298 87 500 67 800 Apr-11 43.68 2.5%

47 Sunnyrock Close Germiston 25 Sunnyrock Close Sunnyrock Gauteng Logistics 15 038 85 200 82 600 Apr-11 53.44 3.3%

48 3 & 6 Cedarfield Close Springfield Park 3 & 6 Cedarfield Close Springfield Park KwaZulu-Natal Logistics 11 689 84 300 67 060 Apr-11 52.37 -

49 45 Richard Carte Road Mobeni 45 Richard Carte Road Mobeni KwaZulu-Natal Logistics 11 653 84 100 46 100 Apr-11 # -

50 40 Brakfontein Century Park 40 Brakfontein Road Louwlardia Gauteng Logistics 13 412 84 000 77 200 Apr-11 # -

51 Nurburg Road Raceway Industrial Park 2 Monte Carlo Road Raceway Industrial Park Gauteng Logistics 11 267 84 000 54 784 Sep-12 # -

52 37 Diesel Road Isando 37 Diesel Road Isando Gauteng Logistics 21 824 82 000 80 900 Apr-11 38.26 -

53 35 Intersite Avenue Umgeni 35 Intersite Avenue Umgeni Business Park KwaZulu-Natal Logistics 10 000 77 500 74 900 Apr-11 90.56 7.0%

54 Radnor Road Tygerberg 20 Radnor Road Tygerberg Western Cape Logistics 12 880 76 600 52 000 Apr-11 # -

55 Corporate Park North Roan Crescent Corporate Park North Midrand Gauteng Logistics 11 402 74 000 33 466 Mar-06 53.71 -

56 45 Angus Crescent 45 Angus Crescent Longmeadow Gauteng Logistics 8 835 70 200 40 068 Mar-07 # -

57 4 Platinum Road Longmeadow 4 Platinum Road Longmeadow Gauteng Logistics 7 386 70 000 50 519 Jun-07 # -

58 Bevan Road Roodekop Bevan Road Roodekop Gauteng Logistics 20 255 69 800 45 000 Apr-11 # -

59 16 Industry Road 16 Industry Road Gauteng Logistics 11 245 67 200 12 497 Jun-07 # -

60 Tiger Moth Road Aeroton Cnr Tiger Moth and Guy Gibson Road Aeroton Gauteng Logistics 15 893 66 800 13 887 Jun-93 # -

61 ACA House Press Avenue Crown City Press Avenue Crown City Gauteng Logistics 8 338 65 200 47 500 Apr-11 # -

62 Imvubu Park Close Riverhorse****Imvubu Park Close Riverhorse Industrial Park Durban KwaZulu-Natal Logistics 18 226 61 100 67 500 Apr-11 # -

63 33 Angus Crescent Longmeadow 33 Angus Crescent Longmeadow Gauteng Logistics 7 503 61 000 43 514 Jun-07 69.76 -

64 Clovelly Business Park Midrand 342 Old Pretoria Road Midrand Gauteng Logistics 12 515 60 400 41 600 Apr-11 44.32 -

65 9 Ayshire Avenue Longmeadow 9 Ayshire Avenue Longmeadow Gauteng Logistics 7 090 58 500 41 169 Mar-10 # -

66 Pelican Park Jet Park Malcolm Moodie Crescent Jet Park Gauteng Logistics 11 191 58 000 51 200 Apr-11 50.26 -

67 Constantia Park Durban 1415 North Coast Road Redhill KwaZulu-Natal Logistics 9 783 57 500 49 900 Apr-11 62.64 -

68 Watt Road Uitenhage Watt Road Uitenhage Eastern Cape Logistics 23 370 57 000 45 300 Dec-08 # -


70 50 Electron Avenue Isando 50 Electron Avenue Isando Gauteng Logistics 11 000 55 450 36 400 Apr-11 # -

71 4th Street Wynberg 4th Street Wynberg Gauteng Logistics 13 248 53 500 7 943 Aug-04 36.97 -

72 53 Angus Crescent Longmeadow 53 Angus Crescent Longmeadow Gauteng Logistics 6 850 52 600 39 500 Apr-11 # -

73 Rigger Road Spartan 79 – 83 Rigger Road Spartan Gauteng Logistics 8 229 51 600 8 900 Aug-04 # -


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37 12 - 18 Elliot Avenue, Epping 2 12 - 18 Elliot Avenue, Epping 2 Western Cape Logistics 20 725 97 200 66 500 Mar-13 38.83 -


39 Harries Street Germiston Cnr Harries and Sigma Roads Germiston South Gauteng Logistics 18 342 93 700 24 000 Aug-04 # -

40 Cambridge Commercial Park 22 Witkoppen Road Paulshof Gauteng Logistics 13 412 93 000 86 200 Apr-11 66.58 19.7%

41 Strijdom Commercial Park 123 Malibongwe Drive Strijdompark Gauteng Logistics 15 496 92 800 89 300 Apr-11 61.06 10.4%

42 2 Joyner Road Prospecton 2 Joyner Road Prospecton KwaZulu-Natal Logistics 17 354 91 200 70 000 Apr-11 # -

43 City Deep Hi-tech Outspan Road City Deep Gauteng Logistics 18 125 89 000 46 000 Sep-07 45.62 -

44 Chemserve Spartan 3 Johann Birkart Road Kempton Park Gauteng Logistics/Industrial 14 905 88 400 67 500 Aug-09 51.90 32.8%

45 Waterpas Street Isando Waterpas Street Isando Gauteng Logistics/Office 14 717 88 400 63 300 Apr-11 54.56 -

46 38 Isando Road Isando 38 Isando Road Isando Gauteng Logistics 19 298 87 500 67 800 Apr-11 43.68 2.5%

47 Sunnyrock Close Germiston 25 Sunnyrock Close Sunnyrock Gauteng Logistics 15 038 85 200 82 600 Apr-11 53.44 3.3%

48 3 & 6 Cedarfield Close Springfield Park 3 & 6 Cedarfield Close Springfield Park KwaZulu-Natal Logistics 11 689 84 300 67 060 Apr-11 52.37 -

49 45 Richard Carte Road Mobeni 45 Richard Carte Road Mobeni KwaZulu-Natal Logistics 11 653 84 100 46 100 Apr-11 # -

50 40 Brakfontein Century Park 40 Brakfontein Road Louwlardia Gauteng Logistics 13 412 84 000 77 200 Apr-11 # -

51 Nurburg Road Raceway Industrial Park 2 Monte Carlo Road Raceway Industrial Park Gauteng Logistics 11 267 84 000 54 784 Sep-12 # -

52 37 Diesel Road Isando 37 Diesel Road Isando Gauteng Logistics 21 824 82 000 80 900 Apr-11 38.26 -

53 35 Intersite Avenue Umgeni 35 Intersite Avenue Umgeni Business Park KwaZulu-Natal Logistics 10 000 77 500 74 900 Apr-11 90.56 7.0%

54 Radnor Road Tygerberg 20 Radnor Road Tygerberg Western Cape Logistics 12 880 76 600 52 000 Apr-11 # -

55 Corporate Park North Roan Crescent Corporate Park North Midrand Gauteng Logistics 11 402 74 000 33 466 Mar-06 53.71 -

56 45 Angus Crescent 45 Angus Crescent Longmeadow Gauteng Logistics 8 835 70 200 40 068 Mar-07 # -

57 4 Platinum Road Longmeadow 4 Platinum Road Longmeadow Gauteng Logistics 7 386 70 000 50 519 Jun-07 # -

58 Bevan Road Roodekop Bevan Road Roodekop Gauteng Logistics 20 255 69 800 45 000 Apr-11 # -

59 16 Industry Road 16 Industry Road Gauteng Logistics 11 245 67 200 12 497 Jun-07 # -

60 Tiger Moth Road Aeroton Cnr Tiger Moth and Guy Gibson Road Aeroton Gauteng Logistics 15 893 66 800 13 887 Jun-93 # -

61 ACA House Press Avenue Crown City Press Avenue Crown City Gauteng Logistics 8 338 65 200 47 500 Apr-11 # -

62 Imvubu Park Close Riverhorse****Imvubu Park Close Riverhorse Industrial Park Durban KwaZulu-Natal Logistics 18 226 61 100 67 500 Apr-11 # -

63 33 Angus Crescent Longmeadow 33 Angus Crescent Longmeadow Gauteng Logistics 7 503 61 000 43 514 Jun-07 69.76 -

64 Clovelly Business Park Midrand 342 Old Pretoria Road Midrand Gauteng Logistics 12 515 60 400 41 600 Apr-11 44.32 -

65 9 Ayshire Avenue Longmeadow 9 Ayshire Avenue Longmeadow Gauteng Logistics 7 090 58 500 41 169 Mar-10 # -

66 Pelican Park Jet Park Malcolm Moodie Crescent Jet Park Gauteng Logistics 11 191 58 000 51 200 Apr-11 50.26 -

67 Constantia Park Durban 1415 North Coast Road Redhill KwaZulu-Natal Logistics 9 783 57 500 49 900 Apr-11 62.64 -

68 Watt Road Uitenhage Watt Road Uitenhage Eastern Cape Logistics 23 370 57 000 45 300 Dec-08 # -


70 50 Electron Avenue Isando 50 Electron Avenue Isando Gauteng Logistics 11 000 55 450 36 400 Apr-11 # -

71 4th Street Wynberg 4th Street Wynberg Gauteng Logistics 13 248 53 500 7 943 Aug-04 36.97 -

72 53 Angus Crescent Longmeadow 53 Angus Crescent Longmeadow Gauteng Logistics 6 850 52 600 39 500 Apr-11 # -

73 Rigger Road Spartan 79 – 83 Rigger Road Spartan Gauteng Logistics 8 229 51 600 8 900 Aug-04 # -


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75 7 Old Pretoria Road Nelspruit 7 Old Pretoria Road Nelspruit Mpumalanga Logistics 9 983 50 200 37 400 Apr-11 # -

76 30 Bell Street Hennopspark 30 Bell Street Hennopspark Gauteng Logistics 10 512 49 300 35 500 Apr-11 # -

77 Brands Hatch Close Cnr Indianapolis and Brands Hatch Close Kyalami Park Gauteng Logistics 6 597 49 100 26 890 Nov-06 63.27 -

78 17 Kramer Road Kramerville 17 Kramer Road Kramerville Gauteng Logistics 6 222 48 800 27 900 Apr-11 70.03 -

79 1105 Anvil Road Robertville 1105 Anvil Road Robertville Gauteng Logistics 10 800 48 100 30 700 Apr-11 # -

80 49 Ayshire Road Longmeadow 49 Ayshire Road Longmeadow Gauteng Logistics 7 263 48 000 39 700 Apr-11 # -

81 Eastborough Business Park 15 – 21 Olympia Street Eastgate Gauteng Logistics 9 053 46 800 44 400 Apr-11 55.44 9.2%

82 38 Milkyway Avenue Linbro Park 38 Milkyway Avenue Linbro Park Gauteng Logistics 5 790 43 800 51 400 Apr-11 # -

83Sandton Commercial Village Eastgate 15th Street Eastgate Gauteng Logistics 7 993 43 250 35 400 Apr-11 54.51 20.0%

84 146 Serenade Road Rustivia 146 Serenade Road Rustivia Gauteng Logistics 4 400 43 000 30 519 Apr-10 # -

85 Eastside Corporate Park Midrand Richards Drive Midrand Gauteng Logistics 9 395 42 600 34 600 Apr-11 49.53 -

86 Fortune Street City Deep Fortune Street City Deep Gauteng Logistics 8 558 42 500 34 300 Apr-11 # -

87 Robertville Industrial Katrol Avenue Robertville Gauteng Logistics 9 137 41 600 10 137 Dec-05 # -

88 87 - 91 Goodwood Road 87 - 91 Goodwood Road Mahogany Ridge Pinetown KwaZulu-Natal Logistics 6 447 41 550 33 600 Oct-10 56.51 -

89 47 Jeffels Road Prospecton 47 Jeffels Road Prospecton KwaZulu-Natal Logistics 6 307 41 100 42 400 Apr-11 # -

90 7 Wilcox Road Prospecton 7 Wilcox Road Prospecton KwaZulu-Natal Logistics 8 070 41 000 31 300 Apr-11 # -

91 Westmead Road Pinetown 4 – 10 Westmead Road Westmead Pinetown KwaZulu-Natal Logistics 8 921 41 000 3 186 May-88 48.62 -

92 2 Drakensberg Drive Longmeadow 2 Drakensberg Drive Longmeadow Gauteng Logistics 6 906 40 600 24 800 Apr-11 58.27 22.7%

93 RutherfordsCnr Smit Street and Harris Street Industries West Germiston Gauteng Logistics 7 800 39 650 6 670 Aug-04 # -

94 10 Covora Road 10 Covora Road Jet Park Gauteng Logistics 9 197 38 700 28 700 Jun-07 44.40 21.5%

95 Indianapolis Boulevard Raceway Indianapolis Road Raceway Industrial Park Germiston Gauteng Logistics 5 965 37 500 27 000 Apr-11 # -

96 9 – 13 Olympia Street Eastgate 9 – 13 Olympia Street Eastgate Gauteng Logistics 8 210 37 400 35 600 Apr-11 50.82 36.3%

97 Director and Megawatt Road Cnr Director and Megawatt Road Spartan Gauteng Logistics 5 216 36 700 29 278 Jun-07 # -

98 38 Reedbuck Crescent 38 Reedbuck Crescent Corporate Park Midrand Gauteng Logistics 6 143 36 000 18 103 Nov-06 # -

99 Essex Street Meadowdale Essex Street Meadowdale Gauteng Logistics 7 259 35 900 35 800 Apr-11 # 7.3%

100 19 Ayshire Avenue 19 Ayshire Avenue Longmeadow Gauteng Logistics 4 912 34 550 21 604 Mar-07 # -

101 28 Milkyway Avenue Linbro Park 28 Milkyway Avenue Linbro Park Gauteng Logistics 5 776 33 800 32 000 Apr-11 64.75 -

102 Merinda Industrial Park Jet Park 71 – 73 Rudo Nel Street Jet Park Gauteng Logistics 8 130 33 200 27 500 Apr-11 41.58 -

103 86 Tsessebe Crescent 86 Tsessebe Crescent Corporate Park Midrand Gauteng Logistics 6 362 32 500 27 661 Jun-07 53.06 -

104 Citrus Street Citrus Street Laser Park Gauteng Logistics 6 833 32 500 24 193 Jun-07 45.01 -

105 James Crescent Midrand James Crescent Midrand Gauteng Logistics 7 170 32 500 26 900 Apr-11 46.56 -

106 Yaldwyn Road Jet Park Yaldwyn Road Jet Park Gauteng Logistics 3 829 32 000 19 400 Apr-11 77.41 -

107 Coventry Park Midrand 675 Old Pretoria Road Midrand Gauteng Logistics 6 293 31 000 24 500 Apr-11 49.88 -

108 Cranberry Street Cranberry Street Laser Park Gauteng Logistics 5 651 30 500 18 856 Jun-07 50.98 -

109 7 Nywerheid Street Tunney 7 Nywerheid Street Tunney Gauteng Logistics 4 183 29 400 21 000 Apr-11 # -


111 20 Ebonyfield Avenue Springfield 20 Ebonyfield Avenue Springfield Park KwaZulu-Natal Logistics 5 305 27 950 29 700 Apr-11 # -



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75 7 Old Pretoria Road Nelspruit 7 Old Pretoria Road Nelspruit Mpumalanga Logistics 9 983 50 200 37 400 Apr-11 # -

76 30 Bell Street Hennopspark 30 Bell Street Hennopspark Gauteng Logistics 10 512 49 300 35 500 Apr-11 # -

77 Brands Hatch Close Cnr Indianapolis and Brands Hatch Close Kyalami Park Gauteng Logistics 6 597 49 100 26 890 Nov-06 63.27 -

78 17 Kramer Road Kramerville 17 Kramer Road Kramerville Gauteng Logistics 6 222 48 800 27 900 Apr-11 70.03 -

79 1105 Anvil Road Robertville 1105 Anvil Road Robertville Gauteng Logistics 10 800 48 100 30 700 Apr-11 # -

80 49 Ayshire Road Longmeadow 49 Ayshire Road Longmeadow Gauteng Logistics 7 263 48 000 39 700 Apr-11 # -

81 Eastborough Business Park 15 – 21 Olympia Street Eastgate Gauteng Logistics 9 053 46 800 44 400 Apr-11 55.44 9.2%


83Sandton Commercial Village Eastgate 15th Street Eastgate Gauteng Logistics 7 993 43 250 35 400 Apr-11 54.51 20.0%

84 146 Serenade Road Rustivia 146 Serenade Road Rustivia Gauteng Logistics 4 400 43 000 30 519 Apr-10 # -

85 Eastside Corporate Park Midrand Richards Drive Midrand Gauteng Logistics 9 395 42 600 34 600 Apr-11 49.53 -

86 Fortune Street City Deep Fortune Street City Deep Gauteng Logistics 8 558 42 500 34 300 Apr-11 # -

87 Robertville Industrial Katrol Avenue Robertville Gauteng Logistics 9 137 41 600 10 137 Dec-05 # -

88 87 - 91 Goodwood Road 87 - 91 Goodwood Road Mahogany Ridge Pinetown KwaZulu-Natal Logistics 6 447 41 550 33 600 Oct-10 56.51 -

89 47 Jeffels Road Prospecton 47 Jeffels Road Prospecton KwaZulu-Natal Logistics 6 307 41 100 42 400 Apr-11 # -

90 7 Wilcox Road Prospecton 7 Wilcox Road Prospecton KwaZulu-Natal Logistics 8 070 41 000 31 300 Apr-11 # -

91 Westmead Road Pinetown 4 – 10 Westmead Road Westmead Pinetown KwaZulu-Natal Logistics 8 921 41 000 3 186 May-88 48.62 -

92 2 Drakensberg Drive Longmeadow 2 Drakensberg Drive Longmeadow Gauteng Logistics 6 906 40 600 24 800 Apr-11 58.27 22.7%

93 RutherfordsCnr Smit Street and Harris Street Industries West Germiston Gauteng Logistics 7 800 39 650 6 670 Aug-04 # -

94 10 Covora Road 10 Covora Road Jet Park Gauteng Logistics 9 197 38 700 28 700 Jun-07 44.40 21.5%

95 Indianapolis Boulevard Raceway Indianapolis Road Raceway Industrial Park Germiston Gauteng Logistics 5 965 37 500 27 000 Apr-11 # -

96 9 – 13 Olympia Street Eastgate 9 – 13 Olympia Street Eastgate Gauteng Logistics 8 210 37 400 35 600 Apr-11 50.82 36.3%

97 Director and Megawatt Road Cnr Director and Megawatt Road Spartan Gauteng Logistics 5 216 36 700 29 278 Jun-07 # -


99 Essex Street Meadowdale Essex Street Meadowdale Gauteng Logistics 7 259 35 900 35 800 Apr-11 # 7.3%

100 19 Ayshire Avenue 19 Ayshire Avenue Longmeadow Gauteng Logistics 4 912 34 550 21 604 Mar-07 # -

101 28 Milkyway Avenue Linbro Park 28 Milkyway Avenue Linbro Park Gauteng Logistics 5 776 33 800 32 000 Apr-11 64.75 -

102 Merinda Industrial Park Jet Park 71 – 73 Rudo Nel Street Jet Park Gauteng Logistics 8 130 33 200 27 500 Apr-11 41.58 -

103 86 Tsessebe Crescent 86 Tsessebe Crescent Corporate Park Midrand Gauteng Logistics 6 362 32 500 27 661 Jun-07 53.06 -

104 Citrus Street Citrus Street Laser Park Gauteng Logistics 6 833 32 500 24 193 Jun-07 45.01 -

105 James Crescent Midrand James Crescent Midrand Gauteng Logistics 7 170 32 500 26 900 Apr-11 46.56 -

106 Yaldwyn Road Jet Park Yaldwyn Road Jet Park Gauteng Logistics 3 829 32 000 19 400 Apr-11 77.41 -

107 Coventry Park Midrand 675 Old Pretoria Road Midrand Gauteng Logistics 6 293 31 000 24 500 Apr-11 49.88 -

108 Cranberry Street Cranberry Street Laser Park Gauteng Logistics 5 651 30 500 18 856 Jun-07 50.98 -

109 7 Nywerheid Street Tunney 7 Nywerheid Street Tunney Gauteng Logistics 4 183 29 400 21 000 Apr-11 # -


111 20 Ebonyfield Avenue Springfield 20 Ebonyfield Avenue Springfield Park KwaZulu-Natal Logistics 5 305 27 950 29 700 Apr-11 # -


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113 10 Drakensberg Drive Longmeadow 10 Drakensberg Drive Longmeadow Gauteng Logistics 2 999 25 450 18 196 Mar-10 # -

114 Milkyway Road Crown Mines Milkyway Road Crown Mines Gauteng Logistics 3 865 25 300 19 359 Jun-07 # -

115 68 Galaxy Avenue Linbro Park 68 and 71 Galaxy Avenue Linbro Park Gauteng Logistics 2 900 25 100 16 300 Apr-11 # -

116 36 Houer Road City Deep 36 Houer Road City Deep Gauteng Logistics 5 057 25 000 14 300 Oct-07 # -

117 5 - 7 Ayshire Avenue Longmeadow Ayshire Avenue Longmeadow Gauteng Logistics 3 710 24 800 21 538 Mar-10 # -

118 4 Chloorkring Richards Bay 4 Chloorkring Richards Bay KwaZulu-Natal Logistics 3 260 24 700 15 000 Apr-11 # -

119 Louis Trichard Street Nelspruit Louis Trichard Street Nelspruit Mpumalanga Logistics 3 297 24 500 19 120 Apr-11 50.01 -

120 79 Reedbuck Crescent Corporate Park 79 Reedbuck Crescent Corporate Park Gauteng Logistics 4 194 24 300 18 700 Apr-11 # -

121 70 Lechwe Street Corporate Park 70 Lechwe Street Corporate Park Gauteng Logistics 4 835 24 000 24 600 Apr-11 52.96 -

122 Lees Street Wynberg Lees Street Wynberg Gauteng Logistics 4 105 23 700 2 382 Aug-84 52.72 -

123 Le Roux and West Street Midrand Cnr Le Roux and West Street Midrand Gauteng Logistics 5 036 23 000 11 150 Oct-96 47.46 -

124 12 Stockwell Road Pinetown 12 Stockwell Road Pinetown KwaZulu-Natal Logistics 4 294 22 700 24 700 Apr-11 46.44 -

125 Albert Amon Road Meadowdale Albert Amon Road Meadowdale Gauteng Logistics 4 064 22 300 7 628 Mar-07 # -

126 64 Lechwe Street Corporate Park 64 Lechwe Street Corporate Park Gauteng Logistics 5 447 21 950 20 300 Apr-11 # -

127 20 Loper Avenue Spartan 20 Loper Avenue Spartan Gauteng Logistics 3 827 21 700 19 600 Apr-11 53.99 -

128 48 Koornhof Road 48 Koornhof Road Meadowdale Gauteng Logistics 3 397 21 200 16 511 Jun-07 # -

129 Brunton Circle Founders View South Brunton Circle Founders View South Gauteng Logistics 3 428 20 000 20 600 Apr-11 # -

130 20 Alexander Road Westmead 18 – 22 Alexander Road Westmead KwaZulu-Natal Logistics 3 992 19 600 15 100 Apr-11 48.22 -

131 Greenbushes Old Cape Road Port Elizabeth Eastern Cape Logistics 6 016 19 550 16 300 Apr-11 31.09 25.0%

132 79 Willowfield Crescent 79 Willowfield Crescent Springfield Park KwaZulu-Natal Logistics 2 983 18 950 12 800 Apr-11 55.53 -

133 56 Kelly Road Jet Park 56 Kelly Road Jet Park Gauteng Logistics 3 821 18 100 18 500 Apr-11 44.30 -

134 24 Rudo Nell Street Jet Park 24 Rudo Nell Street Jet Park Gauteng Logistics 3 754 18 000 21 200 Apr-11 41.28 -

135 93 Goodwood Road Pinetown 93 Goodwood Road Pinetown KwaZulu-Natal Logistics 3 134 18 000 16 500 Apr-11 52.97 -

136 368 Sifon Street Robertville 368 Sifon Street Robertville Gauteng Logistics 4 550 18 000 12 300 Dec-08 # -

137 City Deep Rittel 8 Fortune Street City Deep Gauteng Logistics 4 053 17 800 10 000 Sep-11 37.80 -

138 Latei Street Isando Cnr Latei and Hulley Streets Isando Gauteng Logistics 4 443 17 700 15 200 Apr-11 38.89 -

139 12 Olympia Street Eastgate 12 and 14 Olympia Street Eastgate Gauteng Logistics 4 433 17 400 19 000 Apr-11 50.30 -

140 11 Covora Road Jet Park 11 Covora Road Jet Park Gauteng Logistics 3 831 17 350 10 100 Apr-11 40.82 -

141 Megawatt Road Megawatt Road Spartan Gauteng Logistics 2 710 16 700 14 243 Jun-07 51.00 -

142 122 Koornhof Road Meadowdale 122 Koornhof Road Meadowdale Gauteng Logistics 3 192 16 550 19 500 Apr-11 69.55 -

143 4 Neutron Street Linbro Park 4 Neutron Street Linbro Park Gauteng Logistics 2 000 16 450 13 200 Apr-11 # -

144 555 Malcolm Moodie Crescent Jet Park 555 Malcolm Moodie Crescent Jet Park Gauteng Logistics 2 454 16 400 12 200 Apr-11 # -


146 112 Roan Crescent 112 Roan Crescent Corporate Park Midrand Gauteng Logistics 2 177 15 600 5 925 Nov-06 # -

147 70 Gazelle Ave Corporate Park 68 – 72 Gazelle Avenue Corporate Park Gauteng Logistics 2 372 15 400 14 800 Apr-11 # -

148 Bofors Circle Park Epping Bofors Circle Park Epping Western Cape Logistics 2 828 15 300 12 226 Jan-96 46.04 -

149 4 Electron Street Linbro Park 4 Electron Street Linbro Park Gauteng Logistics 1 944 15 150 11 180 Apr-11 # -



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113 10 Drakensberg Drive Longmeadow 10 Drakensberg Drive Longmeadow Gauteng Logistics 2 999 25 450 18 196 Mar-10 # -

114 Milkyway Road Crown Mines Milkyway Road Crown Mines Gauteng Logistics 3 865 25 300 19 359 Jun-07 # -

115 68 Galaxy Avenue Linbro Park 68 and 71 Galaxy Avenue Linbro Park Gauteng Logistics 2 900 25 100 16 300 Apr-11 # -

116 36 Houer Road City Deep 36 Houer Road City Deep Gauteng Logistics 5 057 25 000 14 300 Oct-07 # -

117 5 - 7 Ayshire Avenue Longmeadow Ayshire Avenue Longmeadow Gauteng Logistics 3 710 24 800 21 538 Mar-10 # -

118 4 Chloorkring Richards Bay 4 Chloorkring Richards Bay KwaZulu-Natal Logistics 3 260 24 700 15 000 Apr-11 # -

119 Louis Trichard Street Nelspruit Louis Trichard Street Nelspruit Mpumalanga Logistics 3 297 24 500 19 120 Apr-11 50.01 -

120 79 Reedbuck Crescent Corporate Park 79 Reedbuck Crescent Corporate Park Gauteng Logistics 4 194 24 300 18 700 Apr-11 # -


122 Lees Street Wynberg Lees Street Wynberg Gauteng Logistics 4 105 23 700 2 382 Aug-84 52.72 -

123 Le Roux and West Street Midrand Cnr Le Roux and West Street Midrand Gauteng Logistics 5 036 23 000 11 150 Oct-96 47.46 -

124 12 Stockwell Road Pinetown 12 Stockwell Road Pinetown KwaZulu-Natal Logistics 4 294 22 700 24 700 Apr-11 46.44 -

125 Albert Amon Road Meadowdale Albert Amon Road Meadowdale Gauteng Logistics 4 064 22 300 7 628 Mar-07 # -


127 20 Loper Avenue Spartan 20 Loper Avenue Spartan Gauteng Logistics 3 827 21 700 19 600 Apr-11 53.99 -

128 48 Koornhof Road 48 Koornhof Road Meadowdale Gauteng Logistics 3 397 21 200 16 511 Jun-07 # -

129 Brunton Circle Founders View South Brunton Circle Founders View South Gauteng Logistics 3 428 20 000 20 600 Apr-11 # -

130 20 Alexander Road Westmead 18 – 22 Alexander Road Westmead KwaZulu-Natal Logistics 3 992 19 600 15 100 Apr-11 48.22 -

131 Greenbushes Old Cape Road Port Elizabeth Eastern Cape Logistics 6 016 19 550 16 300 Apr-11 31.09 25.0%

132 79 Willowfield Crescent 79 Willowfield Crescent Springfield Park KwaZulu-Natal Logistics 2 983 18 950 12 800 Apr-11 55.53 -


134 24 Rudo Nell Street Jet Park 24 Rudo Nell Street Jet Park Gauteng Logistics 3 754 18 000 21 200 Apr-11 41.28 -

135 93 Goodwood Road Pinetown 93 Goodwood Road Pinetown KwaZulu-Natal Logistics 3 134 18 000 16 500 Apr-11 52.97 -

136 368 Sifon Street Robertville 368 Sifon Street Robertville Gauteng Logistics 4 550 18 000 12 300 Dec-08 # -

137 City Deep Rittel 8 Fortune Street City Deep Gauteng Logistics 4 053 17 800 10 000 Sep-11 37.80 -

138 Latei Street Isando Cnr Latei and Hulley Streets Isando Gauteng Logistics 4 443 17 700 15 200 Apr-11 38.89 -

139 12 Olympia Street Eastgate 12 and 14 Olympia Street Eastgate Gauteng Logistics 4 433 17 400 19 000 Apr-11 50.30 -

140 11 Covora Road Jet Park 11 Covora Road Jet Park Gauteng Logistics 3 831 17 350 10 100 Apr-11 40.82 -

141 Megawatt Road Megawatt Road Spartan Gauteng Logistics 2 710 16 700 14 243 Jun-07 51.00 -

142 122 Koornhof Road Meadowdale 122 Koornhof Road Meadowdale Gauteng Logistics 3 192 16 550 19 500 Apr-11 69.55 -

143 4 Neutron Street Linbro Park 4 Neutron Street Linbro Park Gauteng Logistics 2 000 16 450 13 200 Apr-11 # -




147 70 Gazelle Ave Corporate Park 68 – 72 Gazelle Avenue Corporate Park Gauteng Logistics 2 372 15 400 14 800 Apr-11 # -

148 Bofors Circle Park Epping Bofors Circle Park Epping Western Cape Logistics 2 828 15 300 12 226 Jan-96 46.04 -

149 4 Electron Street Linbro Park 4 Electron Street Linbro Park Gauteng Logistics 1 944 15 150 11 180 Apr-11 # -


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151 778 Richards Drive Midrand 778 Richards Drive Midrand Gauteng Logistics 3 300 14 600 14 300 Apr-11 48.78 -

152 19 Spartan Road 19 and 21 Spartan Road Spartan Gauteng Logistics 2 238 14 600 14 600 Apr-11 59.90 -

153 78 Loper Avenue Aeroport 78 Loper Avenue Aeroport Gauteng Logistics 2 722 14 000 13 000 Apr-11 50.35 -


155 75 Kyalami Boulevard 75 Kyalami Boulevard Kyalami Park Gauteng Logistics 1 665 13 600 6 784 Nov-06 71.23 -



158 19 Ebonyfield Avenue Springfield Park 19 Ebonyfield Avenue Springfield Park KwaZulu-Natal Logistics 2 729 13 200 9 900 Apr-11 46.85 -



161 Director Road Spartan Director Road Spartan Gauteng Logistics 1 600 10 300 8 600 Jun-07 # -



164 50 Tsessebe Crescent 50 Tsessebe Crescent Corporate Park Midrand Gauteng Logistics 1 849 9 650 6 765 Nov-06 # -

165 3 Capital Hill Business Park 3 Capital Hill Business Park Midrand Gauteng Logistics 1 825 9 150 3 898 Nov-06 # -


167 62 Gazelle Avenue 62 Gazelle Avenue Corporate Park Midrand Gauteng Logistics 1 318 7 900 4 606 Nov-06 # -

168 Le Roux Avenue Midrand Le Roux Avenue Midrand Gauteng Logistics 1 658 7 450 4 640 Apr-11 48.96 -

169 City Deep Mini Units Cnr Heidelberg and Vickers Roads City Deep Gauteng Logistics 1 350 6 700 3 356 Nov-06 62.80 -

170 39 Loper Street Spartan 39 Loper Street Spartan Aeroport Gauteng Logistics 953 6 400 1 944 Nov-06 # -

171 28 Linbro Village Linbro Park 22 Village Crescent Linbro Park Gauteng Logistics 612 5 100 4 500 Apr-11 # -


Total logistics 1 796 707 9 484 470 6 864 613

173 West Street Sandton Cnr West and Maude Streets Sandton Gauteng Office 14 143 372 000 267 200 Apr-11 $ -

174 Long Street Cape Town 2 Long Street Cape Town Western Cape Office 23 487 339 200 59 000 Jan-03 113.84 13.3%

175 Monyetla Office Park Inyanga Close Sunninghill Gauteng Office 17 535 237 600 217 000 Dec-08 112.06 23.6%

176 Oak Avenue Highveld Oak Avenue Highveld Business Park Centurion Gauteng Office 11 700 198 300 121 000 Oct-07 $ -

177 Cullinan Office Park 2 Cullinan Place Morningside Gauteng Office 9 428 190 000 116 000 Oct-09 137.54 -

178 PricewaterhouseCoopers Pretoria Ida Street Menlo Park Gauteng Office 6 405 172 000 39 636 Dec-00 $ -

179 Kildrummy Office Park Paulshof Witkoppen Road Paulshof Gauteng Office 11 944 169 500 179 700 Apr-11 117.81 7.4%

180 Oxford Manor Illovo 196 Oxford Road Illovo Gauteng Office 12 722 166 100 128 000 Apr-11 112.84 0.9%

181 Rutherford Estate Scott Street 1 Scott Street Waverley Gauteng Office 9 192 162 000 119 800 Apr-11 136.78 -

182 Fourways Office Park Fourways Roos Street Fourways Gauteng Office 15 146 158 500 176 400 Apr-11 102.37 18.0%

183 Wedgewood Office Park 3 Muswell Road Bryanston Gauteng Office 9 625 123 000 110 500 Dec-08 107.30 17.5%

184 204 Rivonia Road Morningside 204 Rivonia Road Morningside Gauteng Office 8 231 115 100 137 200 Apr-11 147.74 75.6%

185 33 Fricker Road Illovo 33 Fricker Road Illovo Gauteng Office 6 355 106 000 100 700 Apr-11 134.27 -

186 114 Dennis Road Athol Gardens 114 Dennis Road Athol Gardens Gauteng Office 5 736 98 000 57 200 Dec-08 $ -

187 Hobart Square 23 Arklow Road Bryanston Gauteng Office 6 629 95 500 69 750 Apr-11 120.17 -

188 Centurion Office Park Hendrik Verwoerd Drive Centurion Gauteng Office 7 660 89 600 23 017 Aug-04 105.79 16.2%


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151 778 Richards Drive Midrand 778 Richards Drive Midrand Gauteng Logistics 3 300 14 600 14 300 Apr-11 48.78 -

152 19 Spartan Road 19 and 21 Spartan Road Spartan Gauteng Logistics 2 238 14 600 14 600 Apr-11 59.90 -

153 78 Loper Avenue Aeroport 78 Loper Avenue Aeroport Gauteng Logistics 2 722 14 000 13 000 Apr-11 50.35 -


155 75 Kyalami Boulevard 75 Kyalami Boulevard Kyalami Park Gauteng Logistics 1 665 13 600 6 784 Nov-06 71.23 -



158 19 Ebonyfield Avenue Springfield Park 19 Ebonyfield Avenue Springfield Park KwaZulu-Natal Logistics 2 729 13 200 9 900 Apr-11 46.85 -



161 Director Road Spartan Director Road Spartan Gauteng Logistics 1 600 10 300 8 600 Jun-07 # -




165 3 Capital Hill Business Park 3 Capital Hill Business Park Midrand Gauteng Logistics 1 825 9 150 3 898 Nov-06 # -


167 62 Gazelle Avenue 62 Gazelle Avenue Corporate Park Midrand Gauteng Logistics 1 318 7 900 4 606 Nov-06 # -

168 Le Roux Avenue Midrand Le Roux Avenue Midrand Gauteng Logistics 1 658 7 450 4 640 Apr-11 48.96 -

169 City Deep Mini Units Cnr Heidelberg and Vickers Roads City Deep Gauteng Logistics 1 350 6 700 3 356 Nov-06 62.80 -

170 39 Loper Street Spartan 39 Loper Street Spartan Aeroport Gauteng Logistics 953 6 400 1 944 Nov-06 # -



Total logistics 1 796 707 9 484 470 6 864 613

173 West Street Sandton Cnr West and Maude Streets Sandton Gauteng Office 14 143 372 000 267 200 Apr-11 $ -

174 Long Street Cape Town 2 Long Street Cape Town Western Cape Office 23 487 339 200 59 000 Jan-03 113.84 13.3%

175 Monyetla Office Park Inyanga Close Sunninghill Gauteng Office 17 535 237 600 217 000 Dec-08 112.06 23.6%

176 Oak Avenue Highveld Oak Avenue Highveld Business Park Centurion Gauteng Office 11 700 198 300 121 000 Oct-07 $ -

177 Cullinan Office Park 2 Cullinan Place Morningside Gauteng Office 9 428 190 000 116 000 Oct-09 137.54 -

178 PricewaterhouseCoopers Pretoria Ida Street Menlo Park Gauteng Office 6 405 172 000 39 636 Dec-00 $ -

179 Kildrummy Office Park Paulshof Witkoppen Road Paulshof Gauteng Office 11 944 169 500 179 700 Apr-11 117.81 7.4%

180 Oxford Manor Illovo 196 Oxford Road Illovo Gauteng Office 12 722 166 100 128 000 Apr-11 112.84 0.9%

181 Rutherford Estate Scott Street 1 Scott Street Waverley Gauteng Office 9 192 162 000 119 800 Apr-11 136.78 -

182 Fourways Office Park Fourways Roos Street Fourways Gauteng Office 15 146 158 500 176 400 Apr-11 102.37 18.0%

183 Wedgewood Office Park 3 Muswell Road Bryanston Gauteng Office 9 625 123 000 110 500 Dec-08 107.30 17.5%

184 204 Rivonia Road Morningside 204 Rivonia Road Morningside Gauteng Office 8 231 115 100 137 200 Apr-11 147.74 75.6%

185 33 Fricker Road Illovo 33 Fricker Road Illovo Gauteng Office 6 355 106 000 100 700 Apr-11 134.27 -

186 114 Dennis Road Athol Gardens 114 Dennis Road Athol Gardens Gauteng Office 5 736 98 000 57 200 Dec-08 $ -

187 Hobart Square 23 Arklow Road Bryanston Gauteng Office 6 629 95 500 69 750 Apr-11 120.17 -

188 Centurion Office Park Hendrik Verwoerd Drive Centurion Gauteng Office 7 660 89 600 23 017 Aug-04 105.79 16.2%

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189 Caxton House East London 35 Terminus Street East London Eastern Cape Office 10 220 84 300 21 566 Aug-04 109.26 5.7%

190 28 On Sloane 28 Sloane Street Bryanston Gauteng Office 4 790 81 300 56 000 Oct-09 135.12 -

191 19 Girton Road Parktown 19 Girton Road Parktown Gauteng Office 7 335 81 000 47 000 Dec-08 $ 10.2%

192 Northdowns Bryanston 17 Georgian Crescent Bryanston Gauteng Office 5 750 80 700 39 500 Jul-11 113.60 15.9%

193 Parc Nicol 3001 William Nicol Drive Bryanston Gauteng Office 5 233 76 800 67 300 Dec-08 149.27 15.3%

194 137 Daisy Street Sandton 137 Daisy Street Sandton Gauteng Office 5 650 73 000 74 600 Apr-11 $ -

195 11 Naivasha Road 11 Naivasha Road Sunninghill Gauteng Office 6 546 68 600 50 323 Nov-06 $ 28.2%

196 Cambridge Manor Paulshof Witkoppen Road Paulshof Gauteng Office 6 672 63 500 49 000 Dec-08 91.44 14.3%

197 Leslie Office Park Cnr William Nicol and Leslie Roads Fourways Gauteng Office 4 277 63 000 64 900 Apr-11 140.84 7.6%

198 Culross Court Bryanston 16 Culross Road Bryanston Gauteng Office 4 070 59 150 45 000 Dec-08 120.44 -

199 Choice House Bryanston 22 Sloane Street Bryanston Gauteng Office 4 619 55 000 44 000 Apr-11 99.64 -

200 Howick Close Howick Close Midrand Gauteng Office 3 949 50 500 14 841 Aug-04 129.19 -

201 Westway Office Park Spine Road Westville KwaZulu-Natal Office 3 690 46 500 41 905 Nov-10 108.00 -

202 Corporate Place Cape Town 17 Mispel Avenue Bellville Cape Town Western Cape Office 4 368 41 100 4 681 Feb-96 82.09 5.7%

203 17 Kosi Place Umgeni 17 Kosi Place Umgeni Business Park KwaZulu-Natal Office 3 710 40 000 43 600 Apr-11 104.26 -

204 Standard Bank Crossing 1 Twilight Avenue Fourways Gauteng Office 2 194 38 700 13 900 Aug-04 $ -

205 Petunia Road Bryanston Petunia Road Bryanston Gauteng Office 2 422 38 000 41 700 Apr-11 $ -

206 Howick Close Waterfall Park Howick Close Waterfall Park Gauteng Office 3 230 34 800 25 200 Apr-11 78.74 -

207 8 Armstrong Road La Lucia 8 Armstrong Road La Lucia KwaZulu-Natal Office 2 033 31 000 17 008 Nov-06 126.10 -

208 357 Rivonia Boulevard 357 Rivonia Boulevard Gauteng Office 3 663 30 900 23 000 Dec-08 92.92 17.6%

209 26 Augrabies Road Waterfall Park 26 Augrabies Road Waterfall Park Gauteng Office 3 397 30 300 26 500 Apr-11 $ -

210 21E Polo Crescent Woodmead 21E Polo Crescent Woodmead Gauteng Office 1 750 29 900 24 400 Apr-11 $ -

211 189 Monte Carlo Crescent Kyalami 189 Monte Carlo Crescent Kyalami Park Gauteng Office 3 528 28 000 28 800 Dec-08 83.59 31.6%

212 Muirfield Fourways Golf Park Roos Street Fourways Gauteng Office 2 804 26 800 35 600 Apr-11 113.94 45.1%

213 Highveld Technopark 116 Witch Hazel Road Highveld Technopark Gauteng Office 1 592 21 800 18 200 Apr-11 $ -

214 Pebble Beach Fourways Golf Park Roos Street Fourways Gauteng Office 1 897 21 600 27 100 Apr-11 99.36 -

215 386 Main Road Bryanston 386 Main Road Bryanston Gauteng Office 1 173 21 400 15 600 Apr-11 $ -

216 35 Impala Road Chislehurston 35 Impala Road Chislehurston Gauteng Office 1 399 21 000 10 350 Dec-08 $ 100.0%

217 Chelsea Office Park Rivonia 57 Wessels Road Rivonia Gauteng Office 2 793 21 000 26 000 Dec-08 82.50 85.4%

218 1257 South Road Centurion 1257 South Road Centurion Gauteng Office 1 805 19 000 12 900 Dec-08 $ -

219 Wentworth Roos Street Fourways Gauteng Office 1 488 15 200 15 950 Apr-11 98.85 -

220 Turnberry Fourways Golf Park Roos Street Fourways Gauteng Office 1 418 14 000 19 700 Apr-11 100.78 -

221 Curzon House Grosvenor Road Bryanston Gauteng Office 1 386 13 830 18 000 Apr-11 111.15 49.1%

222 Absa Towers Vanderbijlpark 30 FW Beyers Street Vanderbijlpark Gauteng Office 3 670 13 000 20 000 Apr-11 $ 32.0%

223 Library Office Park Cnr Payne and New Roads Bryanston Gauteng Office 645 6 050 9 400 Apr-11 $ -

Total office 301 104 4 233 130 3 015 627


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189 Caxton House East London 35 Terminus Street East London Eastern Cape Office 10 220 84 300 21 566 Aug-04 109.26 5.7%

190 28 On Sloane 28 Sloane Street Bryanston Gauteng Office 4 790 81 300 56 000 Oct-09 135.12 -

191 19 Girton Road Parktown 19 Girton Road Parktown Gauteng Office 7 335 81 000 47 000 Dec-08 $ 10.2%

192 Northdowns Bryanston 17 Georgian Crescent Bryanston Gauteng Office 5 750 80 700 39 500 Jul-11 113.60 15.9%

193 Parc Nicol 3001 William Nicol Drive Bryanston Gauteng Office 5 233 76 800 67 300 Dec-08 149.27 15.3%

194 137 Daisy Street Sandton 137 Daisy Street Sandton Gauteng Office 5 650 73 000 74 600 Apr-11 $ -

195 11 Naivasha Road 11 Naivasha Road Sunninghill Gauteng Office 6 546 68 600 50 323 Nov-06 $ 28.2%

196 Cambridge Manor Paulshof Witkoppen Road Paulshof Gauteng Office 6 672 63 500 49 000 Dec-08 91.44 14.3%

197 Leslie Office Park Cnr William Nicol and Leslie Roads Fourways Gauteng Office 4 277 63 000 64 900 Apr-11 140.84 7.6%

198 Culross Court Bryanston 16 Culross Road Bryanston Gauteng Office 4 070 59 150 45 000 Dec-08 120.44 -

199 Choice House Bryanston 22 Sloane Street Bryanston Gauteng Office 4 619 55 000 44 000 Apr-11 99.64 -

200 Howick Close Howick Close Midrand Gauteng Office 3 949 50 500 14 841 Aug-04 129.19 -

201 Westway Office Park Spine Road Westville KwaZulu-Natal Office 3 690 46 500 41 905 Nov-10 108.00 -

202 Corporate Place Cape Town 17 Mispel Avenue Bellville Cape Town Western Cape Office 4 368 41 100 4 681 Feb-96 82.09 5.7%

203 17 Kosi Place Umgeni 17 Kosi Place Umgeni Business Park KwaZulu-Natal Office 3 710 40 000 43 600 Apr-11 104.26 -

204 Standard Bank Crossing 1 Twilight Avenue Fourways Gauteng Office 2 194 38 700 13 900 Aug-04 $ -

205 Petunia Road Bryanston Petunia Road Bryanston Gauteng Office 2 422 38 000 41 700 Apr-11 $ -

206 Howick Close Waterfall Park Howick Close Waterfall Park Gauteng Office 3 230 34 800 25 200 Apr-11 78.74 -

207 8 Armstrong Road La Lucia 8 Armstrong Road La Lucia KwaZulu-Natal Office 2 033 31 000 17 008 Nov-06 126.10 -

208 357 Rivonia Boulevard 357 Rivonia Boulevard Gauteng Office 3 663 30 900 23 000 Dec-08 92.92 17.6%

209 26 Augrabies Road Waterfall Park 26 Augrabies Road Waterfall Park Gauteng Office 3 397 30 300 26 500 Apr-11 $ -

210 21E Polo Crescent Woodmead 21E Polo Crescent Woodmead Gauteng Office 1 750 29 900 24 400 Apr-11 $ -

211 189 Monte Carlo Crescent Kyalami 189 Monte Carlo Crescent Kyalami Park Gauteng Office 3 528 28 000 28 800 Dec-08 83.59 31.6%

212 Muirfield Fourways Golf Park Roos Street Fourways Gauteng Office 2 804 26 800 35 600 Apr-11 113.94 45.1%

213 Highveld Technopark 116 Witch Hazel Road Highveld Technopark Gauteng Office 1 592 21 800 18 200 Apr-11 $ -

214 Pebble Beach Fourways Golf Park Roos Street Fourways Gauteng Office 1 897 21 600 27 100 Apr-11 99.36 -

215 386 Main Road Bryanston 386 Main Road Bryanston Gauteng Office 1 173 21 400 15 600 Apr-11 $ -

216 35 Impala Road Chislehurston 35 Impala Road Chislehurston Gauteng Office 1 399 21 000 10 350 Dec-08 $ 100.0%

217 Chelsea Office Park Rivonia 57 Wessels Road Rivonia Gauteng Office 2 793 21 000 26 000 Dec-08 82.50 85.4%

218 1257 South Road Centurion 1257 South Road Centurion Gauteng Office 1 805 19 000 12 900 Dec-08 $ -

219 Wentworth Roos Street Fourways Gauteng Office 1 488 15 200 15 950 Apr-11 98.85 -

220 Turnberry Fourways Golf Park Roos Street Fourways Gauteng Office 1 418 14 000 19 700 Apr-11 100.78 -

221 Curzon House Grosvenor Road Bryanston Gauteng Office 1 386 13 830 18 000 Apr-11 111.15 49.1%

222 Absa Towers Vanderbijlpark 30 FW Beyers Street Vanderbijlpark Gauteng Office 3 670 13 000 20 000 Apr-11 $ 32.0%

223 Library Office Park Cnr Payne and New Roads Bryanston Gauteng Office 645 6 050 9 400 Apr-11 $ -

Total office 301 104 4 233 130 3 015 627

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224 Midrand Protea Hotel 14th Street Noordwyk Gauteng Other 10 524 92 500 97 400 Apr-11 ^ -

225 Cambridge Motor Paulshof 22 Witkoppen Road Paulshof Gauteng Other 3 483 49 400 33 600 Apr-11 ^ -

226 Modderfontein Road Longmeadow Modderfontein Road Longmeadow Gauteng Other 2 420 38 700 28 800 Apr-11 ^ -

227 Imperial Motors Strijdom Park Cnr Malibongwe Drive and Tungsten Road Randburg Gauteng Other 2 104 36 700 12 350 Aug-04 ^ -

228 243 JG Strydom Drive Constantia Kloof 243 JG Strydom Drive Constantia Kloof Gauteng Other 2 212 35 300 22 467 Apr-11 ^ -

Total other 20 743 252 600 194 617

229 The Crescent Umhlanga 1 – 3 Sunset Crescent Umhlanga Ridge KwaZulu-Natal Retail 27 717 455 000 339 300 Apr-11 119.59 4.7%

230 Pineslopes Shopping Centre Witkoppen Road Fourways Gauteng Retail/Office 21 167 316 000 207 500 Apr-11 129.94 4.4%

231 Palm Springs Mall R155 and Falcon Road Orange Farm Gauteng Retail 19 902 288 000 210 000 Apr-11 113.62 3.6%

232 Thrupps Illovo Centre 204 Oxford Road Illovo Gauteng Retail 13 376 257 600 183 500 Apr-11 151.98 4.4%

233 Leslie Road Retail Park Cnr William Nicol and Leslie Roads Fourways Gauteng Retail 13 676 173 700 142 500 Apr-11 114.43 -

234 Edgars West Street 409 – 423 West Street Durban KwaZulu-Natal Retail 14 200 140 200 121 400 Apr-11 59.65 -

235 Bloemfontein Value Mart 81 – 89 Vereeniging Road Fleurdal Free State Retail 12 385 140 000 85 800 Apr-11 92.15 -

236 Fourways Value Mart Forest Drive Fourways Gauteng Retail 7 938 105 600 80 500 Apr-11 117.93 2.1%

237 Appleton’s Malibongwe Drive Randburg Gauteng Retail 3 753 58 800 45 700 Dec-08 137.87 1.4%

238 Jeffreys Bay St Francis Street Jeffreys Bay Eastern Cape Retail 14 519 53 500 67 000 Apr-11 63.97 20.2%

239 Homeworld Centre Malibongwe Drive Randburg Gauteng Retail 6 582 47 000 27 000 Aug-04 98.17 4.5%

Total retail 155 215 2 035 400 1 510 200

240 Clairwood Logistics Park 89 Barrier Lane Mobeni East KwaZulu-Natal Logistics N/a 542 707 542 707(1) Aug-12 N/a N/a

241 Sandton offices*** Rivonia Road Sandton Gauteng Office N/a 146 963 146 963 (1) Mar-14 N/a N/a

242 Linbro Park 1st Avenue Longlake Extension 1 Gauteng Logistics N/a 144 365 144 365 (1) Feb-14 N/a N/a

243 Montague Business Park **Cnr Plattekloof and Koeberg Road Milnerton Cape Town Western Cape Logistics N/a 131 836 131 836 (1) Aug-09 N/a N/a

244 60 Electron Avenue Isando ## 60 Electron Avenue Isando Gauteng Logistics 27 312 89 257 89 257 (1) Apr-11 N/a N/a

245 Greenbushes Old Cape Road Port Elizabeth Eastern Cape Logistics N/a 87 699 87 699 (1) Apr-11 N/a N/a

246 Westlake London Road Westlake Extension 15 Western Cape Logistics N/a 81 474 81 474 (1) Jan-14 N/a N/a


248 Tradeport Merino Avenue City Deep Gauteng Logistics N/a 60 696 60 696 (1) Apr-11 N/a N/a

249 Pomona Maple Road Pomona Gauteng Logistics N/a 44 440 44 440 (1) Dec-13 N/a N/a

250 LouwlardiaCorner of Tlokwa Street and Samrand Link Road Louwlardia Gauteng Logistics N/a 17 034 17 034 (1) Oct-14 N/a N/a

251 N1 Business Park* N1 Highway Midrand Gauteng Logistics N/a 16 854 16 854 (1) Aug-06 N/a N/a

252 Raceway Industrial Park Raceway Industrial Park Gauteng Logistics N/a 8 851 8 851 (1) Apr-11 N/a N/a

Total developments 27 312 1 450 386 1 450 386

Total portfolio 2 390 376 17 825 186 13 276 086

@ Single tenanted property. The average gross rental of single tenanted industrial properties is R44,03.# Single tenanted property. The average gross rental of single tenanted logistics properties is R49,04.$ Single tenanted property. The average gross rental of single tenanted office properties is R121,82.^ Single tenanted property. The average gross rental of single tenanted other properties is R115,81.* Capital has a 20% interest in this development.** Capital has a 25% interest in this development.*** Capital has an 80% interest in this development.**** Capital has a 50% interest in this property.(1) Purchase price includes capitalised costs to date.## Redevelopment


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224 Midrand Protea Hotel 14th Street Noordwyk Gauteng Other 10 524 92 500 97 400 Apr-11 ^ -

225 Cambridge Motor Paulshof 22 Witkoppen Road Paulshof Gauteng Other 3 483 49 400 33 600 Apr-11 ^ -

226 Modderfontein Road Longmeadow Modderfontein Road Longmeadow Gauteng Other 2 420 38 700 28 800 Apr-11 ^ -

227 Imperial Motors Strijdom Park Cnr Malibongwe Drive and Tungsten Road Randburg Gauteng Other 2 104 36 700 12 350 Aug-04 ^ -

228 243 JG Strydom Drive Constantia Kloof 243 JG Strydom Drive Constantia Kloof Gauteng Other 2 212 35 300 22 467 Apr-11 ^ -

Total other 20 743 252 600 194 617

229 The Crescent Umhlanga 1 – 3 Sunset Crescent Umhlanga Ridge KwaZulu-Natal Retail 27 717 455 000 339 300 Apr-11 119.59 4.7%

230 Pineslopes Shopping Centre Witkoppen Road Fourways Gauteng Retail/Office 21 167 316 000 207 500 Apr-11 129.94 4.4%

231 Palm Springs Mall R155 and Falcon Road Orange Farm Gauteng Retail 19 902 288 000 210 000 Apr-11 113.62 3.6%

232 Thrupps Illovo Centre 204 Oxford Road Illovo Gauteng Retail 13 376 257 600 183 500 Apr-11 151.98 4.4%

233 Leslie Road Retail Park Cnr William Nicol and Leslie Roads Fourways Gauteng Retail 13 676 173 700 142 500 Apr-11 114.43 -

234 Edgars West Street 409 – 423 West Street Durban KwaZulu-Natal Retail 14 200 140 200 121 400 Apr-11 59.65 -

235 Bloemfontein Value Mart 81 – 89 Vereeniging Road Fleurdal Free State Retail 12 385 140 000 85 800 Apr-11 92.15 -

236 Fourways Value Mart Forest Drive Fourways Gauteng Retail 7 938 105 600 80 500 Apr-11 117.93 2.1%

237 Appleton’s Malibongwe Drive Randburg Gauteng Retail 3 753 58 800 45 700 Dec-08 137.87 1.4%

238 Jeffreys Bay St Francis Street Jeffreys Bay Eastern Cape Retail 14 519 53 500 67 000 Apr-11 63.97 20.2%

239 Homeworld Centre Malibongwe Drive Randburg Gauteng Retail 6 582 47 000 27 000 Aug-04 98.17 4.5%

Total retail 155 215 2 035 400 1 510 200

240 Clairwood Logistics Park 89 Barrier Lane Mobeni East KwaZulu-Natal Logistics N/a 542 707 542 707(1) Aug-12 N/a N/a

241 Sandton offices*** Rivonia Road Sandton Gauteng Office N/a 146 963 146 963 (1) Mar-14 N/a N/a


243 Montague Business Park **Cnr Plattekloof and Koeberg Road Milnerton Cape Town Western Cape Logistics N/a 131 836 131 836 (1) Aug-09 N/a N/a

244 60 Electron Avenue Isando ## 60 Electron Avenue Isando Gauteng Logistics 27 312 89 257 89 257 (1) Apr-11 N/a N/a

245 Greenbushes Old Cape Road Port Elizabeth Eastern Cape Logistics N/a 87 699 87 699 (1) Apr-11 N/a N/a

246 Westlake London Road Westlake Extension 15 Western Cape Logistics N/a 81 474 81 474 (1) Jan-14 N/a N/a


248 Tradeport Merino Avenue City Deep Gauteng Logistics N/a 60 696 60 696 (1) Apr-11 N/a N/a

249 Pomona Maple Road Pomona Gauteng Logistics N/a 44 440 44 440 (1) Dec-13 N/a N/a

250 LouwlardiaCorner of Tlokwa Street and Samrand Link Road Louwlardia Gauteng Logistics N/a 17 034 17 034 (1) Oct-14 N/a N/a

251 N1 Business Park* N1 Highway Midrand Gauteng Logistics N/a 16 854 16 854 (1) Aug-06 N/a N/a

252 Raceway Industrial Park Raceway Industrial Park Gauteng Logistics N/a 8 851 8 851 (1) Apr-11 N/a N/a

Total developments 27 312 1 450 386 1 450 386

Total portfolio 2 390 376 17 825 186 13 276 086

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Longlake 27 025 m2 Gauteng (Completion June 2015)

Noursepack Epping 17 768 m2 Western Cape

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DECEMBER 2014

Financial year end Wednesday, 31 December 2014

Announcement of 2014 results and declaration of final dividend (on SENS) Wednesday, 28 January 2015

Last day to trade shares inclusive of dividend (cum dividend) Friday, 13 February 2015

Shares trade exclusive of dividend (ex dividend) from Monday, 16 February 2015

Last day to update register for dividend (record date) Friday, 20 February 2015

Payment of 2014 final dividend Monday, 23 February 2015

JUNE 2015

Interim period ends Tuesday, 30 June 2015

Announcement of 2015 interim report and declaration of interim dividend (on SENS) Wednesday, 29 July 2015

Payment of 2015 interim dividend Monday, 31 August 2015

DiaryS H A R E H O L D E R S ’

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If you are in any doubt as to what action you should take arising from the following resolutions, please consult your stockbroker, banker, attorney, accountant or other professional advisor immediately.

Notice is given of the first annual general meeting of shareholders of Capital Property Fund Limited at the company’s registered office, 4th Floor, Rivonia Village, Rivonia Boulevard, Rivonia, 2191, on Thursday, 30 April 2015 at 14h00 for the purpose of presenting the audited company and group financial statements for the year ended 31 December 2014 together with the reports of the directors, the audit committee and the auditors and transacting the following business:

1. Ordinary resolution 1: Re-electing the following non-executive directors, who retire in terms of clause 25.12 of the company’s Memorandum of Incorporation and who offer themselves for re-election:

1.1 BANUS VAN DER WALT (64)Independent non-executive directorB ECON, ADVANCED EXECUTIVE PROGRAMME DATE OF APPOINTMENT: APR 2014 Banus is a retired property practitioner. Banus was previously the managing director of Sanlam Properties and Gensec Property Services for 16 years. Banus has 40 years’ property experience with the Sanlam Group and has travelled extensively to study the property industry, both locally and internationally.

Banus is a past president of the South African Property Owners Association (SAPOA) and has been a non-executive director of Martprop, Acucap, SA Retail, Vukile and iFour. He was also involved in the listing of Primegro, Acucap, Resilient, iFour, SA Retail, MICC and Vukile. He is currently a member of the Property Committee of Sanlam and a non-executive director of three non-listed companies.

1.2 TRURMAN ZUMA (45)Independent non-executive directorCTA, CA(SA) DATE OF APPOINTMENT: APR 2014 Trurman first worked as an equity analyst for Old Mutual, focusing on large cap counters in food, pharmaceuticals, retail and leisure. After three years he moved to Standard Bank, Johannesburg, working as a Private Equity deal-maker before taking the post of Unit Trust Single Manager Head at Stanlib Investments Limited for two years. During his time at Stanlib, Trurman was awarded a scholarship to study at Harvard Business School. He completed his Programme for Management Development in 2004. In May 2006, he opted to leave the corporate environment. He purchased a stake in South Africa’s largest accounts receivable management company, MBD, where he had the position of strategic director. He also has interests in commodity and energy-related businesses and he sits on the board of governors at Hilton

Annual General Meeting of ShareholdersN O T I C E O F

College. He was the chief executive officer of Advisory Services at Momentum Wealth, part of the Momentum Group.

After leaving Momentum, Trurman joined the Absa Group to head up their new division Global Investments and Solutions (“GI&S”). GI&S is responsible for all product that passes through Absa advisers and is responsible for ensuring seamless access of Barclays product and toolsets into South Africa and the African continent. During the second half of 2014, Trurman resigned from the Barclays Africa Group to further his entrepreneurial interests.

1.3 TSHIAMO VILAKAZI (50)Independent non-executive directorBA(SW), LLB, CERTIFICATE IN MINING PROSPECTING (SA) DATE OF APPOINTMENT: APR 2014 Tshiamo is a practising attorney, conveyancer and notary public and the founding member of Vilakazi Commercial Attorneys. Her firm specialises in registration of commercial bonds, notarial registration of personal habitation servitudes in respect of “family titles” in former urban black townships situated in Gauteng Province. She is a legal consultant to Gauteng Provincial Government and Department of Housing and has been in practice for 21 years.

Re-electing the following executive directors, who although not required to retire in terms of the company’s Memorandum of Incorporation, offer themselves for re-election in accordance with best practice principles followed by certain shareholders:

1.4 ANDREW TEIXEIRA (47)Executive directorBSC QUANTITY SURVEYING DATE OF APPOINTMENT: FEB 2014 Andrew started his career in his own construction company. He then joined JHI Real Estate in 1993 in their property management division. He was appointed as the director responsible for property management nationally in 2002.

Andrew served as a director of Diversified Property Fund Limited and was the managing director of Property Fund Managers Limited prior to the Pangbourne Properties Limited merger.

1.5 RUAL BORNMAN (37)Financial directorCA(SA) DATE OF APPOINTMENT: JAN 2014 After completing his articles with KPMG, Rual joined Stanlib where he was involved in management reporting, accounting and system integration.

He then joined a consulting firm implementing reconciliation systems at Stanlib, before being employed by the Resilient group in 2005.

2. Ordinary resolution 2:

Re-electing the members of the audit committee all of whom are independant non-executive directors, who offer themselves for re-election, in terms of section 94(2) of the Companies Act, namely:

2.1 PROTAS PHILI (40)Independent non-executive directorBCOM, CTA, MCOM (TAXATION), CA(SA) DATE OF APPOINTMENT: APR 2014 Protas was previously the director in the corporate finance and transactions division of the Department of Public Enterprises, non-executive director of Rand Merchant Bank and WesBank, national taxation committee member of the South African Institute of Chartered Accountants, deputy director-general and chief financial officer in the Department of Rural Development and Land Reform and chief financial officer of Sentech Limited.

Capital Property Fund Limited(formerly Friedshelf 1497 Proprietary Limited)(Incorporated in the Republic of South Africa)(Registration number: 2013/226575/06)JSE share code: CPF ISIN: ZAE000186821(Approved as a REIT by the JSE)(“Capital” or “the company” or “the group”)

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Protas also previously served on the audit and risk committees of Mogale City Municipality, Safety and Security SETA, Wholesale and Retail SETA and Aventura Holiday Resorts Limited. Protas is currently a director of April 27 Corporate Finance Proprietary Limited, Veterans Capital Proprietary Limited, Anchor Park Investments Proprietary Limited and non-executive director and chairperson of the risk committee of National Housing Finance Corporation (SOC) Limited.

2.2 JAN POTGIETER (46)Independent non-executive directorBCOMPT (HONS), CTA, CA(SA), MANAGEMENT DEVELOPMENT PROGRAM (UNIVERSITY OF MICHIGAN), STRATEGIC PLANNING & MANAGEMENT IN RETAILING (MONASH UNIVERSITY AUSTRALIA) DATE OF APPOINTMENT: APR 2014 Jan qualified as a CA doing his articles with PricewaterhouseCoopers. He held various managerial positions early in his career including business manager at Clover SA and then seven years at various divisions of SABMiller in senior financial roles.

In 2005, he was headhunted by Massmart to join their Massdiscounters team first as financial director then six years as chief executive officer. He then did consulting work before joining the Italtile group as chief operating officer.

2.3 TRURMAN ZUMA (45)Independent non-executive directorCTA, CA(SA)DATE OF APPOINTMENT: APR 2014 Trurman first worked as an equity analyst for Old Mutual, focusing on large cap counters in food, pharmaceuticals, retail and leisure. After three years he moved to Standard Bank, Johannesburg, working as a Private Equity deal-maker before taking the post of Unit Trust Single Manager Head at Stanlib Investments Limited for two years. During his time at Stanlib, Trurman was awarded a scholarship to study at Harvard Business School. He completed his Programme for Management Development in 2004. In May 2006, he opted to leave the corporate environment. He purchased a stake in South Africa’s largest accounts receivable management company, MBD, where he had the position of strategic director. He also has interests in commodity and energy-related businesses and he sits on the board of governors at Hilton College. He was the chief executive officer of Advisory Services at Momentum Wealth, part of the Momentum Group.

After leaving Momentum, Trurman joined the Absa Group to head up their new division Global Investments and Solutions (“GI&S”). GI&S is responsible for all product that passes through Absa advisers and is responsible for ensuring seamless access of Barclays product and toolsets into South Africa and the African continent. During the second half of 2014, Trurman resigned from the Barclays Africa Group to further his entrepreneurial interests.


Re-appointing Deloitte & Touche as auditors of the group with Mr P Kleb currently being the designated audit partner.


Authorising the directors to determine the remuneration of the group’s auditors.

As special business to consider and, if deemed fit, pass with or without modification, which modification is capable of being substantive in nature, the following resolutions:5. Ordinary resolution 5:

Consider as ordinary resolution number 5: Unissued shares under the control of the directors

“RESOLVED THAT the authorised but unissued share capital of the

company be and is hereby placed under the control and authority of the directors of the company which directors are hereby authorised and empowered to allot, issue and otherwise dispose of such share capital to such person or persons on such terms and conditions and at such times as the directors of the company may from time to time and in their discretion deem fit, provided that:

a) such allotment, issue or disposal shall not in aggregate be in excess of 7.5% (seven and a half percent) of the company’s current issued share capital;

b) is subject to a maximum discount of 5% (five percent) of the weighted average traded price on the JSE of those shares over the 10 (ten) business days prior to the date of allotment, issue or disposal as the case may be; and

c) subject further to the provisions of the Companies Act, the Memorandum of Incorporation of the company and the JSE Listings Requirements.”

For the avoidance of doubt, the number of shares that may be allotted, issued or disposed of in terms of this resolution shall exclude any shares issued in terms of the Capital Share Purchase Scheme, the general authority to issue shares for cash under ordinary resolution 6 and the general authority to issue shares for cash for Black Economic Empowerment purposes under ordinary resolution 7.


Consider as ordinary resolution number 6: General authority to issue shares for cash

“RESOLVED THAT the directors of the company be and are hereby authorised by way of a general authority to issue shares in the capital of the company for cash, as and when they in their discretion deem fit, subject to the Companies Act, the Memorandum of Incorporation of the company, the JSE Listings Requirements, when applicable, and the following limitations, namely that:

a) the shares which are the subject of the issue for cash must be of a class already in issue, or where this is not the case, must be limited to such securities or rights that are convertible into a class already in issue;

b) any such issue will be made to “public shareholders” and not “related parties”, all as defined in the JSE Listings Requirements, unless the JSE otherwise agrees;

c) the total aggregate number of shares which may be issued for cash in terms of this authority may not exceed 88 053 716 shares, being 5% of the company’s issued shares as at the date of notice of this annual general meeting. Accordingly, any shares issued under this authority prior to this authority lapsing shall be deducted from the 88 053 716 shares the company is authorised to issue in terms of this authority for the purpose of determining the remaining number of shares that may be issued in terms of this authority;

d) in the event of a sub-division or consolidation of shares prior to this authority lapsing, the existing authority shall be adjusted accordingly to represent the same allocation ratio;

e) this authority shall be valid until the company’s next annual general meeting, provided that it shall not extend beyond 15 (fifteen) months from the date that this authority is given;

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f ) an announcement containing full details of the issue, including the number of shares issued, the average discount to the weighted average trade price of the shares over the 30 days prior to the date that the issue is agreed in writing and an explanation, including supporting documentation (if any), of the intended use of the funds will be published at the time of any issue representing, on a cumulative basis within 1 (one) financial year, 5% (five percent) of the number of shares in issue prior to the issue; and

g) in determining the price at which an issue of shares may be made in terms of this authority, the maximum discount permitted will be 5% (five percent) of the weighted average traded price on the JSE of those shares over the 10 (ten) business days prior to the date that the price of the issue is determined or agreed to by the directors of the company.”

For the avoidance of doubt, the number of shares that may be issued for cash in terms of this resolution shall exclude any shares issued in terms of the Capital Share Purchase Scheme, any shares placed under the control of directors under ordinary resolution 5 and the general authority to issue shares for cash for Black Economic Empowerment purposes under ordinary resolution 7.

Ordinary resolution number 6 is required, under the JSE Listings Requirements, to be passed by achieving a 75% majority of the votes cast in favour of such resolution by all shareholders present or represented by proxy and entitled to vote at the annual general meeting.

7. Ordinary resolution 7:Consider as ordinary resolution number 7: General authority to issue shares for Black Economic Empowerment purposes.

“RESOLVED THAT the directors of the company be and are hereby authorised by way of a general authority to issue shares in the capital of the company for cash for Black Economic Empowerment purposes, as and when they in their discretion deem fit, subject to the Companies Act, the Memorandum of Incorporation of the company, the JSE Listings Requirements, when applicable, and the following limitations, namely that: a) the shares which are the subject of the issue for cash

must be of a class already in issue, or where this is not the case, must be limited to such securities or rights that are convertible into a class already in issue;

b) any such issue will be made to “public shareholders” and not “related parties”, all as defined in the JSE Listings Requirements, unless the JSE otherwise agrees;

c) the total aggregate number of shares which may be issued for cash in terms of this authority may not exceed 88 053 716 shares, being 5% of the company’s issued shares as at the date of notice of this annual general meeting. Accordingly, any shares issued under this authority prior to this authority lapsing shall be deducted from the 88 053 716 shares the company is authorised to issue in terms of this authority for the purpose of determining the remaining number of shares that may be issued in terms of this authority;

d) in the event of a sub-division or consolidation of shares prior to this authority lapsing, the existing authority shall be adjusted accordingly to represent the same allocation ratio;

e) this authority shall be valid until the company’s next annual general meeting, provided that it shall not extend beyond 15 (fifteen) months from the date that this authority is given;

f ) an announcement containing full details of the issue, including the number of shares issued, the average discount to the weighted average trade price of the shares over the 30 days prior to the date that the issue is agreed in writing and an explanation, including supporting documentation (if any), of the intended use of the funds will be published at the time of any issue representing, on a cumulative basis within 1 (one) financial year, 5% (five percent) of the number of shares in issue prior to the issue;

g) in determining the price at which an issue of shares may be made in terms of this authority, the maximum discount permitted will be 5% (five percent) of the weighted average traded price on the JSE of those shares over the 10 (ten) business days prior to the date that the price of the issue is determined or agreed to by the directors of the company; and

h) any such issue shall, if applicable, comply with the provisions of the authority granted to the company to provide financial assistance for the purchase of or subscription for shares.”

For the avoidance of doubt, the number of shares that may be issued for cash for Black Economic Empowerment purposes shall exclude any shares issued in terms of the Capital Share Purchase Scheme, any shares placed under the control of directors under ordinary resolution 5 and the general authority to issue shares for cash under ordinary resolution 6.

Ordinary resolution number 7 is required, under the JSE Listings Requirements, to be passed by achieving a 75% majority of the votes cast in favour of such resolution by all shareholders present or represented by proxy and entitled to vote at the annual general meeting.

8. Ordinary resolution 8:Consider as ordinary resolution number 8: Non-binding advisory vote on remuneration policy.

“RESOLVED THAT in accordance with the principles of the King III report on governance, and through a non-binding advisory vote, the company’s remuneration policy and the implementation thereof as further detailed below be and is hereby approved.”

Remuneration Philosophy and Policy

OVERVIEWThe group aims to retain its competitive advantage in the industry by attracting talented individuals and retaining experienced staff who demonstrate the behavioural traits which fit the Group’s entrepreneurial and dynamic culture.The remuneration committee (“the committee”) oversees the development and annual review of the remuneration policy which is ultimately approved by the board. In doing so it ensures that the policy aligns the executive and management remuneration with the value delivered to the Group’s stakeholders and further recognises exceptional individual contributions. The remuneration committee has been mandated by the board to authorise the remuneration and incentivisation of all employees, including executive directors.

N O T I C E O F Annual General Meeting of Shareholders(continued)

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The remuneration policy is based on the following guiding principles:

• remuneration must support key business strategies;

• remuneration must create a strong, performance-orientated environment that is consistent with the group’s long-term objective of value creation for shareholders;

• remuneration must be structured to attract, motivate and retain talented employees;

• the remuneration policy should promote risk management and not encourage excessive risk-taking by key decision makers;

• remuneration should be structured in a manner that allows for the recognition and encouragement of exceptional performance, both at an individual and Group level;

• the remuneration policy should be transparent and easy to understand; and

• remuneration should be equitable both from an internal perspective, taking into account employees, their roles and qualifications, and from an external perspective, ensuring that remuneration is in line with the market.

Executive and management remuneration principlesThe Group draws from a wide variety of sources in determining the remuneration of staff, including independent surveys, peer group comparisons, publicly available data and market place intelligence

from local as well as international sources. Remuneration packages are structured depending on the required skills and experiences at each level as well as the employee’s level of influence on strategy and the complexity of each role.

Remuneration comprises both fixed and variable pay. Fixed pay comprises the annual salary and is referred to as the Total Guaranteed Package (“TGP”) in the table below. The Group does not offer any medical aid or retirement benefits and these are for the account of the employee.

Variable pay comprises medium-term or performance incentives through cash bonuses and long-term incentives via the share incentive scheme. Medium-term incentives are used to motivate and reward annual financial performance in line with the Group’s strategic goals. This remuneration is payable in cash and based on the individual’s performance which is linked to the Group’s performance. A further discretionary bonus may also be paid to individuals who are considered by the remuneration committee to have rendered exceptional service in any given year.

Long-term incentives create value and align the interests of employees with shareholders as employees receive value only if there is capital appreciation in the shares. Details of the scheme, including individual’s limits and the regularity of issues are discussed in the table below.

The methods for determining the various remuneration components are as follows:

ElementEmployee Level

Fixed or Variable Purpose Detail

Total Guaranteed Package

Executive directors

Fixed Compensation, at market related levels, for employees performing their specific roles

TGPs are benchmarked at the median of the peer group.

The committee considers the following when reviewing TGPs:

• Inflation over the period;• Market for specific employees skills;• Individual performance• Group performance including growth in

distributions per share

TGPs are reviewed annually in November.

Management Fixed Compensation, at market related levels, for employees performing their specific roles

TGPs are benchmarked at the median of the peer group.

The committee considers the following when reviewing TGPs:

• Inflation over the period;• Market for specific employees skills;• Individual performance• Changes in responsibilities• Gains in experience

Medium–term incentive scheme

Executive directors and management

Variable Achievement of short and medium term organisational goals

Based on set objectives the committee pays cash bonuses to management.

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Share incentive schemeThe share incentive scheme was adopted in 2014. The intention is to align the interest of employees and shareholders and to drive long-term earnings growth which is the driver of long-term share price appreciation.

Non-executive directors’ remunerationNon-executive directors’ remuneration consists of a base fee and a fee per board sub-committee membership which are reviewed annually. The remuneration committee recommends directors’ fees payable to non-executive directors to the board which proposes the fees for shareholder approval at the annual general meeting.

Non-executive directors do not participate in the Capital share incentive scheme nor is there any other remuneration paid to non-executive directors, including remuneration linked to the performance of the group.

Service contracts All employees are required to sign employment contracts with the Group. These contracts set out the working hours, salary, leave entitlement, notice and probation periods and other relevant information. There is no restraint of trade clause in any of the employment contracts.

PAY DATERemuneration is paid on the 25th day of each month and if this day falls on a weekend, remuneration will be paid on the Friday preceding the 25th.

TAX ALLOWANCESManagement and employees can request assistance in structuring their remuneration packages. The primary allowance that will be allowed is a travel allowance.

The methods for determining the various remuneration components are as follows: (continued)

ElementEmployee Level

Fixed or Variable Purpose Detail

Long term incentives - share incentive scheme

Executive directors and management

Variable Alignment of long-term organisational goals and sustainable long-term total shareholder return.

Based on set objectives the Committee may award employees shares.

Employees take full market risk on the shares from date of issue. The Group is of the opinion that this aligns the interests of employees and shareholders more closely.

Share incentive scheme allocations will be considered by the Committee not more than twice per year outside closed periods.

• Participation in the long-term incentive scheme is limited to 20 times an employee’s annual salary.

• Backdating of share-based incentives is not permitted.

• Shares are offered to participants who then accept such number of shares that they want to invest in. The value of the shares accepted is advanced as a loan to the participant by the Share Incentive Scheme.

• Shares are issued at the market price of Capital shares and therefore no discount is provided.

• Shares vest immediately and participants assume the full risk associated with the investment made and loan advanced.

• Salient terms of the share incentive scheme loans are:

- Loans are repayable on the tenth anniversary of the loans being granted.

- Loans bear interest at the weighted average cost of funding of the group with interest being serviced bi-annually. In the event of the interest paid being more than the interest received, the Group will subsidise the shortfall. This subsidy is phased out over a maximum period of five years.

- Loans are repayable on termination of employment.

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9. Special resolution 1:Consider as special resolution number 1: Approval of financial assistance to related or inter-related companies

“RESOLVED THAT, to the extent required by the Companies Act, the board of directors of the company may, subject to compliance with the requirements of the company’s Memorandum of Incorporation, the Companies Act and the JSE Listings Requirements, each as presently constituted and as amended from time to time, authorise the company to provide direct or indirect financial assistance in terms of section 45 of the Companies Act by way of loans, guarantees, the provisions of security or otherwise, to any of its present or future subsidiaries and/or any other company or corporation that is or becomes related or inter-related (as defined in the Companies Act) to the company for any purpose or in connection with any matter, such authority to endure until the next annual general meeting of the company.”

The reason for and effect of special resolution number 1

The company provides loans to and/or guarantees loans or other obligations of companies in the group. The company believes it necessary that it continues to have the ability to provide financial assistance to, inter alia, ensure that the company’s subsidiaries and other related and inter-related companies and corporations have access to financing and/or financial backing from the company (as opposed to banks) and is accordingly proposing special resolution number 1.

Therefore, the reason for, and effect of, special resolution number 1 is to permit the company to provide direct or indirect financial assistance (within the meaning attributed to that term in section 45) to the entities referred to in special resolution number 1 above.

In terms of section 45, if the resolution is adopted, the board of directors will only be entitled to authorise such financial assistance if it is satisfied that the terms under which the financial assistance is proposed to be given are fair and reasonable to the company and, immediately after providing the financial assistance, the company would satisfy the solvency and liquidity test contemplated in the Companies Act.

10. Special resolution 2:Consider as special resolution number 2: Approval of the repurchase of shares

“RESOLVED THAT, subject to the Companies Act, the Memorandum of Incorporation of the company, the JSE Listings Requirements and the restrictions set out below, the repurchase of shares of the company, either by the company or by any subsidiary of the company, is hereby authorised, on the basis that:

a) this authority will only be valid until the company’s next annual general meeting or for 15 months from the date of this resolution, whichever period is shorter;

b) the number of shares which may be acquired pursuant to this authority in any financial year may not in the aggregate exceed 20%, or 10% where such acquisitions are effected by a subsidiary, of the company’s share capital as at the date of this notice of annual general meeting;

c) the repurchase of shares must be effected through the order book operated by the JSE trading system and done without any prior arrangement between the company and the counter-party;

d) the repurchase of shares may not be made at a price greater than 10% above the weighted average of the market value for the shares for the five business days immediately preceding the date on which the transaction is effected;

e) at any point in time, the company will only appoint one agent to effect repurchases on its behalf;

f ) the company or its subsidiary may not repurchase shares during a prohibited period as defined in paragraph 3.67 of the JSE Listings Requirements unless there is a repurchase programme in place and the dates and quantities of shares to be repurchased during the prohibited period are fixed and has been submitted to the JSE in writing prior to commencement of the prohibited period; and

g) a resolution by the board of directors is passed that the board of directors of the company authorises the repurchase, that the company and the relevant subsidiaries have passed the solvency and liquidity test as set out in section 4 of the Companies Act and that, since the test was performed, there have been no material changes to the financial position of the group.”

In accordance with the JSE Listings Requirements, the directors record that although there is no immediate intention to effect a repurchase of shares of the company, the directors would utilise the general authority to repurchase shares when suitable opportunities present themselves, which opportunities may require expeditious and immediate action.

The directors, after considering the effect of maximum repurchase, are of the opinion that for a period of 12 months after the date of the notice of annual general meeting:

a) the company and the group will be able, in the ordinary course of business, to pay its debts;

b) the assets of the company and the group will be in excess of the liabilities of the company and the group;

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c) the stated capital and reserves of the company and the group will be adequate for ordinary business purposes; and

d) the working capital of the company and the group will be adequate for ordinary business purposes.

After the company or its subsidiaries has cumulatively repurchased 3% of the initial number of shares (the number of shares in issue at the time that the general authority from shareholders is granted) and for each 3% in aggregate of the initial number of that class acquired hereafter, an announcement will be made in terms of the JSE Listings Requirements.

Reason for and effect of special resolution number 2

The reason for special resolution number 2 is to afford the company or a subsidiary of the company a general authority to effect a repurchase of the company’s shares on the JSE. The effect of the resolution will be that the directors will have the authority, subject to the JSE Listings Requirements and the Companies Act, to effect repurchases of the company’s shares on the JSE, either through the company or through any subsidiary of the company.

The following additional information, which appears elsewhere in the integrated report, is provided in terms of paragraph 11.26 of the JSE Listings Requirements for purposes of special resolution number 2:

Major shareholders – page 19

Stated capital of the company – page 64

Material changesOther than the facts and developments reported on in the integrated report, there have been no material changes in the affairs or financial position of the company and its subsidiaries between the date of signature of the audit report for the year ended 31 December 2014 and the date of this notice of annual general meeting.

Directors’ responsibility statementDirectors, whose names appear on pages 4 to 7 of the integrated report, collectively and individually accept full responsibility for the accuracy of the information pertaining to this special resolution and certify that, to the best of their knowledge and belief, there are no facts that have been omitted which would make any statement false or misleading, and that all reasonable enquiries to ascertain such facts have been made and that the special resolution contains all information required in terms of the JSE Listings Requirements.

11. Special resolution 3:Consider as special resolution number 3: Approval of the provision of financial assistance for the purchase of shares

“RESOLVED THAT, subject to compliance with the requirements of the Companies Act, the Memorandum of Incorporation and the JSE

Listings Requirements, the company, either as lender or as surety or guarantor for a lender, or otherwise is hereby authorised, from time to time, to provide financial assistance for the purchase of or subscription for its shares to The Siyakha Education Trust on the following terms:

a) the maximum additional capital amount (excluding interest, costs, charges, fees and expenses) of any such amounts lent or for which suretyships or guarantees are given may not exceed R1 billion;

b) the maximum period for the repayment of any loan provided or for which suretyships or guarantees are given in terms hereof may not exceed 10 years;

c) the minimum interest rate to be applied to any loan provided may not be less than the prime overdraft rate of interest from time to time publically quoted as such by The Standard Bank of South Africa Limited.”

Reason for and effect of special resolution number 3

The reason for special resolution number 3 is to afford the company authority to provide financial assistance to The Siyakha Education Trust for the purchase of the company’s securities in terms of section 44 of the Companies Act for the purposes of effecting Black Economic Empowerment. The effect of special resolution number 3 is that the directors will have the authority, subject to the Memorandum of Incorporation, the JSE Listings Requirements and the Companies Act, to grant financial assistance on the terms set out in special resolution number 3.

12. Special resolution 4:Consider as special resolution number 4: Approval of directors’ remuneration for their services as directors

“RESOLVED THAT in accordance with section 66 of the Companies Act, fees to be paid by the company to the non-executive directors for their services as directors be and are hereby approved, as follows:

For the year ended31 December 2016

RandChairman 379 080

Non-executive director 262 440

Audit committee member (including chairman) 116 640

Investment committee member (including chairman) 116 640

Remuneration committee member (including chairman) 116 640

Nomination committee member (including chairman) 58 320

Risk committee member (including chairman) 58 320

Social and ethics committee member (including chairman) 58 320

N O T I C E O FN O T I C E O F Annual General Meeting of Shareholders(continued)

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The reason for and effect of special resolution number 4 is to obtain shareholder approval by way of a special resolution in accordance with section 66(9) of the Companies Act for the payment by the company of remuneration to each of the non-executive directors of the company for services as a non-executive director for the period up to 31 December 2016 in the amounts set out under special resolution number 4.

13. Ordinary resolution 9:Consider as ordinary resolution number 9

“RESOLVED THAT any director of the company or the company secretary be and is hereby authorised to do all such things and sign all such documents as may be required to give effect, to ordinary resolutions numbers 1 to 8 and to special resolutions numbers 1 to 4.”

Unless otherwise stated, in order for ordinary resolutions to be adopted, the support of more than 50% of the total number of votes exercisable by shareholders, present in person or by proxy, is required and in order for special resolutions to be adopted, the support of at least 75% of the total number of votes exercisable by shareholders, present in person or by proxy, is required to pass such resolution.

Important dates to note:Record date for receipt of notice purposes: Friday, 20 March 2015

Last day to trade in order to be eligible to vote: Friday, 17 April 2015

Record date for voting purposes (“voting record date”): Friday, 24 April 2015

Statement in terms of section 62(3)(e) of the Companies ActShareholders holding certificated shares and shareholders holding shares in dematerialised form in “own name”:

- may attend and vote at the annual general meeting; alternatively

- may appoint an individual as a proxy (who need not also be a shareholder of the company) to attend, participate in and speak and vote in your place at the annual general meeting by completing the attached form of proxy and returning it to the registered office of Capital or to the transfer secretaries, by no later than 14h00 on Tuesday, 28 April 2015. Alternatively, the form of proxy may be handed to the chairman of the annual general meeting at the annual general meeting or at any time prior to the commencement of the annual general meeting. Please note that your proxy may delegate his/her authority to act on your behalf to another person, subject to the restrictions set out in the attached form of proxy. Please also note that the attached form of proxy must be delivered to the registered office of Capital or to the transfer secretaries or handed to the chairman of the annual general meeting, before your proxy may exercise any of your rights as a shareholder of the company at the annual general meeting.

Please note that any shareholder of the company that is a company may authorise any person to act as its representative at the annual general meeting.

Please also note that section 63(1) of the Companies Act requires that persons wishing to participate in the annual general meeting (including the aforementioned representative) must provide satisfactory identification before they may so participate.

Notice to owners of dematerialised sharesPlease note that if you are the owner of dematerialised shares held through a CSDP or broker (or their nominee) and are not registered as an “own name” dematerialised shareholder, then you are not a registered shareholder of the company, but your CSDP or broker (or their nominee) would be.

Accordingly, in these circumstances, subject to the mandate between yourself and your CSDP or broker as the case may be:

- if you wish to attend the annual general meeting you must contact your CSDP or broker and obtain the relevant letter of representation from it; alternatively

- if you are unable to attend the annual general meeting but wish to be represented at the annual general meeting, you must contact your CSDP or broker and furnish it with your voting instructions in respect of the annual general meeting and/or request it to appoint a proxy. You must not complete the attached form of proxy. The instructions must be provided in accordance with the mandate between yourself and your CSDP or broker, within the time period required by your CSDP or broker.

- CSDP’s, brokers or their nominees, as the case may be, recorded in the company’s sub-register as holders of dematerialised shares should, when authorised in terms of their mandate or instructed to do so by the owner on behalf of whom they hold dematerialised shares, vote by either appointing a duly authorised representative to attend and vote at the annual general meeting or by completing the attached form of proxy in accordance with the instructions thereon and return it to the registered office of the company or to the transfer secretaries, by no later than 14h00 on Tuesday, 28 April 2015. Alternatively, the form of proxy may be handed to the chairman of the annual general meeting at the annual general meeting at any time prior to the commencement of the annual general meeting.

Voting at the annual general meetingIn order to more effectively record the votes and give effect to the intentions of shareholders, voting on all resolutions will be conducted by way of a poll.

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Electronic participation

Shareholders or their proxies may participate in the meeting by way of telephone conference call. Shareholders or their proxies who wish to participate in the annual general meeting via the teleconference facility will be required to advise the company thereof by no later than 14h00 on Tuesday, 28 April 2015 by submitting, by email to Jonathan Bigham at [email protected], or by fax to be faxed to 086 758 4098, for the attention of Jonathan Bigham, relevant contact details including email address, cellular number and landline, as well as full details of the shareholder’s title to the shares issued by the company and proof of identity, in the form of copies of identity documents and share certificates (in the case of certificated shareholders), and (in the case of dematerialised shareholders)

written confirmation from the shareholder’s CSDP confirming the shareholder’s title to the dematerialised shares. Upon receipt of the required information, the shareholder concerned will be provided with a secure code and instructions to access the electronic communication during the annual general meeting.

Shareholders who wish to participate in the annual general meeting by way of telephone conference call must note that they will not be able to vote during the annual general meeting. Such shareholders, should they wish to have their vote counted at the annual general meeting, must, to the extent applicable, (i) complete the form of proxy; or (ii) contact their CSDP or broker, in both instances, as set out above.

Jonathan Bigham CA (SA) Company secretary

Johannesburg 28 January 2015

Address of registered office 4th Floor, Rivonia Village, Rivonia Boulevard, Rivonia, 2191

(PO Box 2555, Rivonia, 2128)

Address of transfer secretaries Link Market Services South Africa Proprietary Limited 13th Floor, Rennie House, 19 Ameshoff Street Braamfontein, 2001

(PO Box 4844, Johannesburg, 2000)

Annual General Meeting of ShareholdersN O T I C E O F(continued)

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For use by the holders of the company’s certificated shares (“certificated shareholders”) and/or dematerialised shares held through a Central Securities Depository Participant (“CSDP”) or broker who have selected “own name” registration (“own name dematerialised shareholders”), at the first annual general meeting of shareholders of the company to be held at the company’s registered office, 4th Floor, Rivonia Village, Rivonia Boulevard, Rivonia, 2191, on Thursday, 30 April 2015 at 14h00, or at any adjournment thereof if required. Additional forms of proxy are available from the company’s registered office.

Not for use by dematerialised shareholders who have not selected “own name” registration. Such shareholders must contact their CSDP or broker timeously if they wish to attend and vote at the annual general meeting and request that they be issued with the necessary Letter of Representation to do so, or provide the CSDP or broker timeously with their voting instructions should they not wish to attend the annual general meeting in order for the CSDP or broker to vote in accordance with their instructions at the annual general meeting.

I/We (name/s in block letters)

of

being the holders of shares in the capital of the company do hereby appoint:

1. or failing him/her,

2. or failing him/her,

3. the chairman of the annual general meeting

as my/our proxy to act for me/us on my/our behalf at the annual general meeting or any adjournment thereof, which will be held for the purposes of considering and, if deemed fit, passing, with or without modification, the ordinary and special resolutions to be proposed thereat as detailed in the notice of annual general meeting; and to vote for and/or against such resolutions and/or to abstain from voting for and/or against the resolutions in respect of the shares registered in my/our name in accordance with the following instructions:

For Against Abstain

Ordinary resolution number 1.1: (Re-election of Banus van der Walt as director)

Ordinary resolution number 1.2: (Re-election of Trurman Zuma as director)

Ordinary resolution number 1.3: (Re-election of Tshiamo Vilakazi as director)

Ordinary resolution number 1.4: (Re-election of Andrew Teixeira as director)

Ordinary resolution number 1.5: (Re-election of Rual Bornman as director)

Ordinary resolution number 2.1: (Re-election of Protas Phili as a member of the audit committee)

Ordinary resolution number 2.2: (Re-election of Jan Potgieter as a member of the audit committee)

Ordinary resolution number 2.3: (Re-election of Trurman Zuma as a member of the audit committee)

Ordinary resolution number 3: (Re-appointment of auditors)

Ordinary resolution number 4: (Authorising directors to determine auditors’ remuneration)

Ordinary resolution number 5: (Unissued shares under the control of the directors)

Ordinary resolution number 6: (General authority to issue shares for cash)

Ordinary resolution number 7: (General authority to issue shares for cash - BEE)

Ordinary resolution number 8: (Non-binding advisory vote on remuneration policy)

Special resolution number 1: (Approval of financial assistance to related or inter-related companies)

Special resolution number 2: (Approval of the repurchase of shares)

Special resolution number 3: (Approval of provision of financial assistance for the purchase of shares)

Special resolution number 4: (Approval of non-executive directors’ remuneration for their services as directors)

Ordinary resolution number 9: (Authority for directors or company secretary to implement resolutions)

Signed at on 2015

Signature

Assisted by (where applicable)

(Indicate instructions to proxy in the spaces provided above). Unless otherwise instructed, my proxy may vote as he thinks fit. Please read the notes on the reverse side hereof.

ProxyF O R M O F

Capital Property Fund Limited(formerly Friedshelf 1497 Proprietary Limited)(Incorporated in the Republic of South Africa) (Registration number: 2013/226575/06)JSE share code: CPF ISIN: ZAE000186821 (Approved as a REIT by the JSE) (“Capital” or “the company”)

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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NOTES TO THE FORM OF PROXY

1. Any alteration or correction made to this form of proxy must be initialled by the signatory(ies).

2. Shareholders that are certificated or own name dematerialised shareholders entitled to attend and vote at the annual general meeting may insert the name of a proxy or the names of two alternative proxies of the shareholder’s choice in the space(s) provided, with or without deleting “the chairperson of the annual general meeting”, but any such deletion must be initialled by the shareholder(s). Such proxy(ies) may participate in, speak and vote at the annual general meeting in the place of that shareholder at the annual general meeting. The person whose name stands first on the form of proxy and who is present at the meeting will be entitled to act as proxy to the exclusion of those whose names follow. If no proxy is named on a lodged form of proxy the chairperson shall be deemed to be appointed as the proxy.

3. A shareholder’s instructions to the proxy must be indicated by the insertion of the relevant number of votes exercisable by the shareholder in the appropriate box(es) provided. Failure to comply with the above will be deemed to authorise the proxy, in the case of any proxy other than the chairperson, to vote or abstain from voting as deemed fit and in the case of the chairperson to vote in favour of the resolution.

4. A shareholder or his/her proxy is not obliged to use all the votes exercisable by the shareholder, but the total of the votes cast or abstained may not exceed the total of the votes exercisable in respect of the shares held by the shareholder.

5. A shareholder may revoke the proxy appointment by (i) cancelling it in writing, or making a later inconsistent appointment of a proxy; and (ii) delivering a copy of the revocation instrument to the proxy and to the company. The revocation of a proxy appointment constitutes a complete and final cancellation of the proxy’s authority to act on behalf of the shareholder as at the later of the date stated in the revocation instrument, if any, or the date on which the revocation instrument was delivered in the required manner.

6. A vote given in terms of an instrument of proxy shall be valid in relation to the annual general meeting notwithstanding the death of the person granting it or the transfer of the shares in respect of which the vote is given, unless an intimation in writing of such death or transfer is received by the transfer secretaries not less than 48 hours before the commencement of the annual general meeting.

7. The chairperson of the annual general meeting may reject or accept any form of proxy which is completed and/or received otherwise than in compliance with these notes, provided that, in respect of acceptances, the chairperson is satisfied as to the manner in which the shareholder concerned wishes to vote.

8. The completion and lodging of this form of proxy will not preclude the relevant shareholder from attending the meeting and speaking and voting in person thereat to the exclusion of any proxy appointed in terms hereof, should such shareholder wish to do so.

9. Documentary evidence establishing the authority of a person signing this form of proxy in a representative capacity must be attached to this form of proxy, unless previously recorded by the company or the transfer secretaries or waived by the chairperson of the annual general meeting.

10. A minor or any other person under legal incapacity must be assisted by his/her parent or guardian, as applicable, unless the relevant documents establishing his/her capacity are produced or have been registered by the company or the transfer secretaries.

11. Where there are joint holders of shares, the vote of the first joint holder who tenders a vote, as determined by the order in which the names stand in the register of shareholders, will be accepted and only that holder whose name appears first in the register in respect of such shares needs to sign this form of proxy.

12. The aforegoing notes contain a summary of the relevant provisions of section 58 of the Companies Act.

Forms of proxy must be lodged at, posted or faxed to the transfer secretaries, Link Market Services South Africa Proprietary Limited:

Hand deliveries to

Link Market Services South Africa Proprietary Limited 13th Floor Rennie House 19 Ameshoff Street Braamfontein 2001

Postal deliveries to

Link Market Services South Africa Proprietary Limited PO Box 4844 Johannesburg 2000

Fax to

086 674 2450

to be received by no later than 14h00 on Tuesday, 28 April 2015.

ProxyF O R M O F(continued)

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AUDITORDeloitte & Touche

Deloitte Place, Building 1

The Woodlands

20 Woodlands Drive

Woodmead, 2052

Private Bag X6 Gallo Manor 2052

BANKERThe Standard Bank of South Africa Limited

Corporate and Investment Banking

7th Floor 3 Simmonds Street

Johannesburg 2001

PO Box 61029 Marshalltown 2107

COMPANY SECRETARYJS Bigham CA(SA)

4th Floor Rivonia Village

Rivonia Boulevard

Rivonia 2191

PO Box 2555 Rivonia 2128

SPONSORJava Capital

2 Arnold Road

Rosebank 2196

PO Box 2087 Parklands 2121

TRANSFER SECRETARIESLink Market Services South Africa Proprietary Limited

13th Floor Rennie House

19 Ameshoff Street

Braamfontein

Johannesburg

2001

PO Box 4844 Johannesburg 2000

A D M I N I S T R A T I O N

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Company name Capital Property Fund Limited

Contact Tel: +27 (0) 11 612 6870 Fax: +27 (0) 11 612 6869

Registered address 4th Floor Rivonia Village Rivonia Boulevard Rivonia 2191 PO Box 2555 Rivonia 2128

Year-end 31 December

Chairman of the board Iraj Abedian

Board of directors I Abedian* (chairman), BL Stuhler (managing director), AA Bornman, DJ Lewis, PT Phili*, JN Potgieter*, AE Teixeira, UJ van der Walt*, TD Vilakazi*, FI Wania, TMZ Zuma*

*Independent non-executive 6 Executive 5 11

Managing director BL Stuhler

Company secretary JS Bigham

Corporate advisors Java Capital

External auditors Deloitte & Touche

Units in issue 1 761 074 329

Gearing ratio 24.8%

Investment portfolio Direct Property: R17 825.2 million

Share price (Cents) 2014 year

High 1 381 cents Low 1 052 cents Closing 1 328 cents

Volume traded 271 million shares (for the six months ended 31 December 2014)

Value traded R3 270 million (for the six months ended 31 December 2014)

Distribution Interim 39.22 cents

Dividend Final 44.22 cents 83.44 cents

Number of investment properties 252 (2013: 252)

Distribution calendar (Final distribution for the 2014 financial year)

Last day to trade cum dividend 13 February 2015

Record date 20 February 2015

Dividend payment 23 February 2015

F A C T S H E E T

4th Floor Rivonia Village

Rivonia Boulevard Rivonia 2191

PO Box 2555 Rivonia 2128

+27 (0) 11 612 6870

+27 (0) 11 612 6899

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