Equites Property Fund Limited (EQU) Earnings Call Transcript & Summary

Good morning, everybody, and welcome to this pre-close presentation for Equites Property Fund, it's absolute pleasure to have you all with us and trust that you will find today's presentation both insightful and useful. I think we'd like to start with the period basically up until now the end of February, we will be presenting year-end results to you in May, but we've got lots of highlights that we would like to share with you and give you a little bit of a taste of what we think will be very well received. So I'd maybe start with a little quote just to spice the situation up. And literally, I think financial year '26 has delivered very solid growth, establishing foundations for future expansion. I think Equites strengthened its position both in debt and equity markets, enhancing funding flexibility and capital readiness. With these foundations in place, the company is well positioned to accelerate development activity and deliver sustained long-term value for shareholders. And I think that really does sum up, I think, the year following financial year '24 and '25 where a lot of base work was done. I think Financial year '26 has seen the results of that base work come through. And also what it's done is it's positioned the organization in a fantastic place for it to move forward. So let's just look at some of the detail in terms of what was achieved in the year. So let's start with spend. So we spent approximately ZAR 900 million during the year which we believe is a significant amount of money to have spent in terms of new product that we brought on board. And notwithstanding that, we see it as a bridging year, and I really think that talks to, I suppose, what we expect to be coming through in the coming years. We've instituted speculative build in the last couple of years, and that's predominantly as a fact of the fact that we have -- we've had sort of almost 0% vacancy in the portfolio. And the sector at large has seen some very good vacancy numbers for everybody that's involved in the sector. And we'll look at that in more detail during the presentation. The leasing activity has been very good. We've renewed 6 leases. I think that talks to the customer relationship that we've developed. But more importantly, I think it also speaks to the quality of product that our tenants are benefiting from and seeing the need to stay in place. We've also agreed 3 new leases, and the portfolio fundamentals are just generally moving forward. And Riaan will talk to that in much more detail in the presentation. Obviously, the cherry on the cake for the financial year has been the conclusion of a successful RFP to win a 90,000 square meter build for Tiger Brands. That obviously is a testimony to the team's effort. The process was extremely hard thought. And as you can imagine, within the realms of South Africa, the competitive tension amongst the premier logistics developers is very high and hence, one needs to be in the A game to win these kinds of tenders. So really pleased with that. Over and above that, we are currently in very advanced negotiations for about 150,000 square meters of further GLA. In fact, some of it has already been signed, but we will unpack that post -- proper disclosures, I suppose, with the year-end results in May. On the positive side, the U.K. keeps on moving forward, slowly but forward. We received the funds from the Newport Pagnell development that we did with Panattoni at the back end of last year. And after about a year of being on the market, DPD Burgess Hill finally sold last year. But more importantly, what we did is by being patient, we were able to achieve the yield that we demanded. We had been made about 4 offers during that process, all at prices less than what we were demanding, which we declined. We held on to our price and eventually, we did get our price, which we're really pleased with. In terms of the debt capital markets and the equity capital markets, obviously, had a great year. We issued our first 7-year note. Our 5-year note achieved remarkable pricing, and obviously, we had an accelerated book build at the back end of last year, which was achieved at a slight premium to NAV, which is obviously very pleasing to see that our shareholders trust in what we're doing and in the future of the organization. So let's move on to the operating environment. So South Africa, where are we? I mean, I have the privilege of obviously attending various functions where I have interaction with CEOs from various industries and the general feel across everything is that there is certainly a sense of optimism and a sense of green shoots coming through the process. Obviously, coming off the gray list at the back end of last year, no doubt, will give added impetus, especially to the international companies wanting to invest in the country. And we are seeing that with the demand drivers in the logistics space, basically being, in my opinion, at an all-time high since we've been listed anyway. Allocations to supply chain are becoming much more important for many, many organizations, and that is reflected in the number of RFPs that are out there. Obviously, the constraint against all of these, obviously, is land. And that leads me into the next bullet point, which is obviously our joint venture with Tridevco, has given Equites the ability to have significant land holdings available to it on the R21, which has become a key supply chain and logistics node. And as a consequence, of Equites' ability to market itself and its product and the availability land in a key node is allowing us to obviously operate successfully in the marketplace. Obviously, this has also helped, as I said earlier, by the sector vacancies, which remain at circa 2%. And what we're seeing more and more is especially amongst the blue chip and larger organizations is there's certainly a prioritization, especially in Gauteng to being in industrial parks and looking at the sustainability features that come with being in these parks and the environments that are not the grime of maybe a yesteryear industrial estate. Today, it's more of a landscape sort of logistics platform, which is very, very different. And as I said earlier, our speculative program continues to go from strength to strength. We developed -- one of our speculative developments last year, obviously, was pre-let to Nebula in advance of completion, which obviously very pleasing for us. And we currently have the 3 speculative builds coming out of the ground, and we are in advanced negotiations on those, notwithstanding the fact that these buildings will only be ready for occupation sort of August, September this year, which really talks to lack of vacancy, but also, I suppose, quality of product in the right location. In terms of our development update, I mean, I've sort of briefly touched on it, but let's go maybe into a bit more detail. The Extension 57, we were able to let that obviously prior to completion. We currently have 18,000 square meters coming out of the ground on -- at Riverfields. We have a further 18,500 coming out over 2 buildings at Jet Park. And as I said, the current -- these 3 buildings are currently in advanced states of negotiation. It doesn't mean we'll get them, but notwithstanding that, it is very pleasing to see that level of interest when we only have sort of foundational work currently coming out of the ground effectively. We've broken ground on the Tiger Brands deal. And obviously, this is a great deal for us in the sense that the yield at which we are consummating it, not necessarily entirely -- it's not entirely the yield on the actual product, but we also have some ancillary fees from the asset management role that we are playing on behalf of Tridevco and some funding benefit too. As I mentioned earlier, we are in advanced negotiations with further developments and one in particular, which is in a very advanced stage. In fact, we are the only person left standing, and we are currently finalizing the lease agreement, but like all these things until the lease is signed, we do not have a deal. So very excited about that and then hopefully be able to announce that in the not-too-distant future. The expectation is that through the period, we will commence construction on approximately ZAR 2 billion of pipeline and which will be spent basically effectively over the next 18, 24, potentially even 36 months. But we believe that there is much more in the pipeline with the amount of RFPs that are currently out. And we probably won't win them all but we'd like to think we will get one or two of them. So on that basis, 2027 from a deployment of capital will be significantly larger than what was financial year '26 and what's very pleasing about that is that a lot of these developments will be done in a position which will be, at worst, neutral but in some cases, slightly accretive as well, which bodes very well for the future of the organization. I think this is something I suppose we've never really touched on, and I think -- we felt it would be important to share this with you at this stage also to make it top of mind because it becomes quite key to our development pipeline going forward. I mean the construction inflation obviously rose to 4.1% last year, year-on-year. However, we have managed to mitigate some of the inflationary pressures that are coming through. I think most of them are predominantly linked to, I suppose, labor costs are certainly putting pressure. We've obviously had the benefit of the rand strengthening, which has eased a bit of a pressure on the steel price, which obviously is a massive function of any development. I mean steel makes up almost 35% of the procurement of every single development that we do in some way or form. So obviously, a key factor. And whilst inflation is tracking slightly above what CPI is, we'd like to think that the construction inflation that we are seeing in our development pipeline at the moment being maybe slightly better than that and really pleased with the development team in terms of how they're managing the tender process and how we are -- we've built up a base of subcontractors over the years who have been very supportive of our business. But likewise, we've been very supportive of their business. And I think that mutual respect and that mutual trust that has been developed with the various subcontractors across the sector is certainly playing very well into Equites' hands. Let's maybe move to the U.K. now and where are we there? So in terms of what we've always defined in South Africa is the Aviva portfolio. We continue to engage positively in the marketplace. And our expectation is that we will achieve the pricing point at which we feel comfortable to let the portfolio go. In the U.K., the portfolio is known as spring boxes, which obviously is a play on us coming from South Africa, which has been received extremely well. It's -- there's 5 assets in the portfolio, and it's a very, very high-quality portfolio, which really has no peer in the marketplace in terms of its high quality. There's no -- there's no straggler in the portfolio. It's 5 high-quality assets, which will find a home in the not-too-distant future. DHL Leeds remains in negotiation with DHL for the rent review. Our expectation is that the uplift on that rent will be somewhere in the region of about 55%. We currently are in a process of arbitration with DHL as there is a little bit of competitive tension there, should we say. So we will not be putting that asset on the market until we have finalized that interview as the new rent will determine a new valuation on the product. What's pleasing about that asset is completely unencumbered. So as and when it is sold, those funds will be repatriated to South Africa. And I think this leads me into what happened during the previous year with DPD Burgess Hill, which is something that I mentioned earlier. We sold it at the asking price and our patience was effectively rewarded. Ultimately, I think what this leads into is the commitment that the Equites management team have that -- we are not leaving the U.K. effectively with our tails between our legs. We are leaving the U.K. because we believe we can redeploy the capital that we have accumulated in the U.K. over the years can be deployed better here, and our asset base in the U.K. has reached a high level of its performance subsequent to its first round of rent reviews. Our average rent review across the portfolio has been north of 40%, and obviously, we've captured all that value in the time frame. And by capturing that value, we've been able to obviously make material capital gain for Equites. And ultimately, we believe being patient to achieve the maximized value of all our assets is key to Equites' successful, let's say, tenure in the U.K. We've managed to sell well, and we continue to expect to do so going forward. In terms of our relationship with the Newlands team, a little bit of an update in terms of where we are there. What we can confirm is all the -- what we call the subsequent sale companies, the Newlands team have taken ownership of all of them, and we have been released of our commitment to all of these companies, and we've been paid the fee that was agreed in the sale agreement. As I said earlier, the Newport Pagnell money has basically been paid and that has been settled. So really pleased with the final outcome of that investment. Coton Park, a deal that I think we announced probably about 6 months ago where JD.com is forward funding a 250,000 square-foot building, and that's all running on schedule, on time, building coming out of the ground as we speak, and expectation is for that building to be completed PC-ed in September '26, following which we will effectively have the final portion of our funds release there, which is at the present moment in time, expected to be approximately GBP 4.4 million. Very pleasing. I think we haven't spoken since the Thrapston approval, which was achieved sort of in August, September last year. We successfully went through judicial review, which was fantastic that we were not JR-ed especially as there is a lobby group in the area that has effectively successfully judicially reviewed a competing site up the road from us at Thrapston so obviously, very pleased that they got JR-ed and not us. And a consequence of which is Newlands have committed to drawing down this piece of land from us. And our expectation is that this will happen towards back end of March, probably beginning of April, where we will receive GBP 3.3 million plus all the interest and the costs that have been associated with the planning process to date. So very pleased with that. And then the final one, obviously, Basingstoke, as we're all aware, we got planning. The 106 agreement was finalized. Judicial review was completed, and we're out of that, and we are very close to finalizing the Section 278, which basically makes the site spade ready to go. And what I'm pleased to sort of share with you guys is that we are in very good negotiations at the moment with 2 freehold users for the site and hopefully, something -- some positive outcomes can come out of those negotiations, which we will be able to announce to you sort of later in the year. Like all these things, they do take time, and we remain optimistic that after a very long and arduous journey on Basingstoke that some benefits will start emerging for Equites during the course of this financial year and into the subsequent one. And on that base, I'm going to basically hand over to Riaan now, and he will take us through the operational update.

Thank you, Andrea. The main objective of any listed -- public listed entity in any jurisdiction is the creation of shareholder value. As a South African REIT, Equites can only achieve that through consistent, predictable, sustainable and growing income streams. To achieve that, we firstly need low vacancies. We've been fortunate that over the past 12 years, we've never had any significant vacancies in our portfolio. That, of course, didn't happen by chance, but as a result of the decision to acquire and develop buildings in desirable logistic nodes of high quality and also with tenants that are top quality. Secondly, to achieve the growing income stream, one needs a healthy escalation profile. In our portfolio, the average is around 6.2%. And if you exclude the Shoprite portfolio, it grows at above 7% per year. The certainty is achieved through the weighted average lease expiry profile and ours sitting at 14.1 years as compared to the sector, which is at 4.8%. Over the past 5 years, we've changed strategy and we've moved away from acquiring facilities, and we now grow our portfolio solely through the creation of new facilities in terms of development leases. This -- the benefit is obvious. Firstly, we create new facilities, generic facilities that would be desirable for multiple tenants. We build them in secure estate in very desirable logistics node. And thirdly, we conclude the development leases with high-quality tenants. Looking at our property fundamentals for FY '27, we have 6 leases expiring making up 47,000 square meters. We are expecting a positive reversion on these 6 leases of 17%. That is as a result of one of the properties in Lords View coming up for review. We concluded the initial lease on this property during the COVID period at rentals, which were below market. FY '28 brings a further 6 expiries, and we anticipate a negative reversion of circa 9% on these leases. Although these are yet to be signed, these are prudent estimates with the impact on distributable earnings limited due to the small GLA. The only vacancy is a 5,000 square meter facility at Meadowview, and we have had interest and we are hopeful to conclude a lease in respect of this property over the next period. We've already talked about our WALE. Now the WALE isn't -- it just doesn't happen by chance. It is as a result of a very disciplined approach through the focus on our development pipeline and avoiding shorter-term acquisitions, which could end up compromising our WALE. We've also seen, over the past years, our asset management fee becoming a more meaningful revenue stream diversifying income and providing upside to distributable earnings. With the type of leases that we conclude, which are by and large triple net we are also largely insulated from operating cost inflation. This limits cost leakage. So contractual rental escalations result in income growth and preserve the value of our leases over time. That's all for me. Laila?

Thank you very much. So for our session this morning, we're going to focus on balance sheet management. As Andreas said, we're stepping into a period of increased development spend and really gearing up for how we're going to source that capital as well as the cost of that capital. So let's maybe start with liquidity. We'll have ZAR 3.8 billion in cash and undrawn facilities and importantly, an ICR of 2.8x, well in excess of any covenants. And if you recall, 2 years ago, when we were in the throes of the Shoprite developments that ICR was significantly lower. And as those developments have come online, that's increased significantly. We expect that to increase even further. Then in terms of our funding, our weighted average debt maturity is 2.9 years with debt costs really coming in over the last 2 years. And there's a slide on it, so I'll save the interesting commentary for that slide. Our interest rate risk, 97% of our debt that's outstanding for longer than a year is hedged. And our interest rate sensitivity is now 17.4 bps for every 100 bps increase or change in rates. Again, we'll talk about this in the slide. And then our LTV is forecast to come down at our last reporting date, we had -- at FY '25, we had an LTV of 36%, and we expect that to be about 34% at FY '26. Let's maybe just start by looking at the loan-to-value ratio. We expect this to reduce by about 2% from FY '25 and at interim when we reported, this had ticked up slightly. There were a couple of items which had resulted in this ticking up, and that was there were share buybacks when the share price still facilitated these buybacks as well as asset developments, which had increased the LTV, which is why we reported at 37.2% at interim. Factors that reduced the LTV, there were significant disposals and these consisted of U.K. disposals, Andrea spoke about DPD Burgess Hill, but also receiving the Newport Pagnell proceeds, which resulted in a reduction in that loan to value. Factors which further resulted in the decrease in the LTV was the accelerated book build, and we were very pleased with that outcome where we raised capital at a premium to net asset value. Over the year, as Andreas said, again, this was sort of a bridging year, but it still meant that we allocated ZAR 900 million to development, which resulted in a slight uptick or increase in that loan to value. And overall, we're very comfortable with where we're presenting -- representing that loan to value at year-end at around 34%. Now when we think about how this positions us for an upcoming year of high development spend, we're very comfortable with where this stands. I think that it's also -- it would be remiss of me not to point out that we are in the process of negotiating the Aviva disposal, and that will significantly reduce that loan-to-value number. Okay. Now when we're allocating capital and as Riaan said, we talk about sustainable value creation and sustainable earnings. We don't have that many levers in our business in which we can create that outperformance. But one of the ways that we do it is through effectively managing our cost of debt. Now where we see our cost of debt at the moment is at 8.2%. And even though we have a very strong hedging ratio at the moment, with 97% of our debt hedged, where we see further upside is in the margins as all the facilities roll off and they get replaced with newer debt facilities. So the chart on the right really shows us how we've managed to reduce our cost of debt. And I think the best illustration of this is that we had a 3-year note. And I think if you look at some of the commentary on the slide, at our last placement, we were managed to place a 5-year note in the DCM space at a margin of JIBAR plus 108. This replaced the 3-year note, which was maturing at JIBAR plus 146. So if you just think about it, we've been able to replace 3-year debt with 5-year debt, which is cheaper or the margin is tighter than the 3-year debt. So what we're looking to do is to actively spot opportune moments in the debt capital markets. Typically, we come to market twice a year via auction. But where there are opportunities for private placements, we'll be looking to do these. One such opportunity where we did manage to take advantage of what we feel was great pricing was a 1-year note, which we managed to place at JIBAR plus 70 basis points. So really just illustrating our ability to come to market and the value which is placed on Equites paper. I think just to end off again, we spoke about the ICR and just where we are, again, very comfortable with that ICR. And as future developments come online, we will be well positioned for that ICR to increase further. Again, just painting the picture of a very stable, well-managed balance sheet with the ability to execute on what we believe will be a strong development pipeline. Andrea?

Awesome. Thank you, Laila. And just I suppose the last part of it of the update really linked to our ESG, the component of solar generation within the makeup of South Africa has increased significantly in the last year from 13% to 16%, and whilst you say 3% may not be a big number, it is a big number. And I think it really talks to the quantity of businesses and households that are effectively resorting to generating their own electricity where possible, thereby reducing their costs on that as well, and Equites is no different in that. So we've seen our capacity grow in the year whilst it's only grown by about it just over a megawatt, it's also a function of the fact that some properties that had solar on them were disposed of, hence, reducing the base somewhat from the previous year. Positively, we've signed 8 PPAs with existing tenants, which will come on stream during the course of this year. And the portfolio in terms of its regeneration and the quality of product that we're bringing on stream that is being certified effectively, we are in a position now where 49% of the portfolio is effectively EDGE Advanced certified, and we also have one Zero Carbon rated building in the portfolio. We're looking to potentially add 2 more to the Zero Carbon rate of building. So watch this space. And the final part of it is that we've been working quite hard at the wastewater treatment strategy within our parks. And we're starting to get some traction. There were some -- let's put it this way, administrative hurdles to be crossed, which have taken a lot longer than we had originally anticipated and hoped, but it seems that we're almost there with those and finally, getting buy-in from the various municipalities and as a consequence, are able to start actually implementing these strategies. And I think I want to make it very clear to our shareholders, obviously, that the reason that we're doing is to enhance the Equites product for our shareholder -- for our tenants to ensure that we create sustainable, long-term product, which will facilitate lease renewal at the appropriate time and obviously, rental growth at the appropriate time. At the moment, the financial metrics associated with wastewater treatment from an Equites perspective, are not massively yield enhancing like electricity maybe can be seen to be, but this may obviously change in time as the cost of water, which is being afforded by the various municipality may need to go up substantially as a cost of the backlog of maintenance that needs to be remedied within the South African municipalities. So I think it's -- and the reason I sort of talk very highly to this, I think it's a bone of contention, especially up in Gauteng at the moment where water is becoming a very, very, very serious matter. And I think in concluding on the ESG stuff, I mean, we -- our ratings with the Morningstar Sustainalytics, scorecards, keep on going from strength to strength. We're currently finalizing our positions in the various sectors that we get judged in and we'll have a much clearer picture of where we stand at our financial year-end results in May, where we will share with you that. But the initial indication, the early indication is that we have risen up the boards very nicely this year, really a testimony to the team and the work that we've done as an organization to continue to try and be cutting edge when it comes to these matters. So well done team Equites. And then I think in concluding, I think the important part is that -- what we want to do is we want to reaffirm guidance. Our guidance at 5% to 7% growth from year to year is still there. And management is super confident that we will be in the range. And obviously, there is a general sense of optimism within the team. I think we're feeling it within the sector. We're feeling it within general industry as well. And and we hope to be the beneficiary of a lot of positive -- all these positive green shoots over the next 2 to 3 years, thereby cementing our position and our ability to give sustained distribution growth for our shareholders, which remains our key focus. On that note, I think that brings the presentation to an end. I'm going to sort of hand over to Laila. She -- I think she is holding the fort there with the questions, and let's maybe hit the questions there, Laila.

Okay. Thank you. let's maybe start. There's a question from Matthew at Laurium, who just wanted some detail on how the Tridevco joint venture works. He's asking do they contribute the land and we fund it? Riaan, Andrea?

Thank you for the question. We cover the land; 50.1%, Equites and 49.9%, Tridevco. Tridevco has contributed the land. And obviously, the lands went into the joint venture at a certain price. And as we develop out, they have got the opportunity to retain their shareholding at 49.9%. By doing so, they would need as facilities are built on the land to contribute some further funds, but they also have the option to dilute, if they do not want to contribute any cash other than the land. It obviously is beneficial for us in that. It limits our expenditure on land, which obviously, for an initial period of time is not income producing, and also ensures that we've got access to very, very desirable land in a node, which has proven very, very successful.

And then what is the time line from breaking ground to first rental for projects such as the Tiger Brands development? .

So that first rental check will be in September next year. So I think beneficial occupation will be given to the client in June, and they'll have effectively 3 months for their fit out following which the rental will start flowing.

Okay. And then Nazeem, there's a couple of questions on the Aviva portfolio. He's asking, has the Aviva sale being postponed? What is our anticipated timing on it?

I think like -- I think importantly here, I think it wouldn't be wise for Equites to put a time line to it. Ultimately, the focus from an Equite's perspective is to maximize shareholder value in that sale. We know that there is a high level of desirability for the portfolio. But like everything, we want to create that pricing tension on the product to ensure that we do maximize the value. We are confident that the sale will happen in due course, but without us actually wanting to put a date on it because like all these things, unforeseen circumstances can rear their head from any corner. And if that were to happen, then we would hate to create a level of disappointment. What we can tell you is that Equites is in a position that wants to maximize its value on that, and we'll undertake the sale at the appropriate price which will result in the appropriate timing being sort of forthcoming from that.

And then his follow-up question was just do we see any near-term balance sheet risks as a result of SA development? And I think we've addressed that in my slide on balance sheet where 34%, we really don't see any near-term risks. Also with the profile of developments, it's sort of -- it's not all upfront, and they do have monthly draws and we're very comfortable with where we are from a balance sheet perspective. .

And notwithstanding that, you also have processes of payments through development, which go well beyond the first check that we receive as well with retentions and the like. So the cash drawdowns on developments are muted over a period of time. So we don't see any pressure there, absolutely.

And then there are questions on Basingstoke. So [ Trinity ] from Anchor as well as Nazeem from Investec, asking about Basingstoke, are we comfortable to continue capitalizing interest on Basingstoke and what is our current plan? .

Okay. So in terms of Basingstoke, we will continue to capitalize interest on it. Yes. our plan is to effectively develop the site out without us wanting to own anything. So we are currently, as I said, speaking to some freehold interest as well as some leasehold potential. The leasehold potential, obviously, will require a purchaser of the leasehold opportunity. But that being said, we believe that everything sits within its current valuation and affordability of being able to execute on these developments over the forthcoming period.

And then Riaan, another question from Nazeem. What was the escalations on the most recent leases signed? And I guess the [indiscernible] from Sandbank Securities is also asking, are we seeing any pressure on escalations given the new inflation targeting framework? .

Good question. There's always pressure from tenants to try and resist above inflation escalations. We have made a policy decision that we do afford escalations of 5% on leases signed for a 20-year duration. Our lease is up to 5 years, has at least a 7% escalation profile, and on 10-year leases, if the initial rental is a market rated rental and we are satisfied with them, we have gone below 7% there. I think escalations need to be seen in conjunction with the initial rent. So obviously, where tenants prefer a lower escalation, it would impact the initial rental that is charged in the lease period. For us, escalations remain very, very important. It's the backbone and the underpin of income growth. So we really try our utmost to protect that. .

And then the last question we have is just Cobus from Value Capital Partners is asking how our engagement with foreign investors has changed over the last 12 to 24 months? Do we see an increase in interest in South African-listed counters? .

Us personally not. We've -- I think we -- if we look at our shareholder register, it's predominantly based by index tracking funds that when it comes to the internationals. I think one of the key challenges for some of the bigger internationals that are happy to invest in South Africa remains scale. We mean there's one company that comes to mind in particular that would love to invest in us, but the minimum investment would be $200 million, which would basically take them above 20%, I think, of our issued share capital very close to it. And consequently, there we've got a liquidity framework around that $200 million, which would basically our current, I suppose, liquidity of daily transaction wouldn't afford. So I think that remains the limiting factor, I think, a little bit of scale would certainly enhance our offering to the internationals. And I think that is something that management is very aware of and very conscious of, and we see creating some scale within the realms of the product profile that we don't want to dilute. But if we can achieve that over the next 3 to 5 years, I think it will be a double whammy in as much as it will dilute the impact of potential reversions and vacancies in the portfolio going forward. But there also, it will then allow for some of the internationals that have bigger requirements in terms of liquidity and daily traded average volumes effectively being such that they feel comfortable to be invested in the counter. But the positive is the various internationals that we have discussed this with over the period, are very positive about the business. And that obviously means that we are certainly on the right path, which I think is important.

Okay. That's it.

Awesome. Thank you. On that note, I would like to thank everybody for having dialed in and watch today. I'd like to thank my co executives for the tireless work and it goes into creating what we've created, as I said, financial year '24 and '25 were within the realms of the 12 years that Equites has been in the public markets, no doubt the hardest us. For us, I think the work that we undertook in those years, though, are starting to bear fruit, and I'm so pleased with the caliber of talent that we've managed to retain in the team, the succession planning that is going into everything at the moment is second to none and the company looks in a really, really, really good place to take advantage of South African macro green shoots that are coming through and hopefully will continue to come through. And then obviously, the supply chain story, which is becoming ever more important in an ever faster market and an ever more discerning consumer that has expectation of having product delivered to them in an ever shorter time frame. And we are there to serve that consumer ultimately. So on that note, thank you for having joined us, and hope you have a great day, and we'll see you in May for the year-end presentation.