The property market had a stellar calendar year return, continuing its recovery cycle post-COVID. 2024 saw the global interest rate cycle entering a declining environment. The lowering of interest rates has multiple positive effects on the property market. The most direct being the declining funding rates, as most companies operate with a 40% leverage ratio.
Locally, increasing consumer confidence is creating a mild decline in vacancy rates. However, there are some concerns in the retail segment, with operators such as Pick n Pay under significant strain. Emerging Europe has been performing well, with NEPI Rockcastle's portfolio generating significant returns.

The 2025 outlook is still positive, and we expect several companies to resume dividend payments. Volatility in the segment is extremely high, but the asset class remains an important building block for a diversified portfolio.