Far fewer than half of SA stores are paying rent on time
- Only half of SA's commercial tenants were in good standing with their landlords at the end of July, new data from the Tenant Profile Network shows.
- Retail outlets were the worst performers - with only 45% paying their rent on time.
- Gauteng was the worst affected, among the bigger provinces.
- For more articles, go to www.BusinessInsider.co.za.
Only 45% of South African retail tenants were in "good standing" with their landlords by end-July, the latest data from Tenant Profile Network (TPN), the largest credit bureau that tracks tenant payment behaviour in SA, shows. This means that their rent was paid on time, or that they received a grace period.
As recently as in March, 73% were in good standing.
But the coronavirus crisis changed everything, forcing many retailers to shut their doors for the first phase of the stringent lockdown.
By April, only 40% were in good standing. Since then, it has remained stagnant at 45%.
The data from TPN shows that clothing retailers – which were only allowed to do proper business from May, under Level 4 of the lockdown – were worst hit.
Looking at other parts of commercial property, almost 60% of industrial property tenants were in good standing by July, while office tenants recovered to 67% in July – almost back at the pre-lockdown level of 75%.
In total, around 50% of commercial tenants were in good standing in July – with 36% paying on time, and 14% receiving a grace period.
The Western Cape has the highest percentage (almost 59%) of
commercial tenants in good standing – but it’s still down significantly from 86%
in the first quarter of this year.
Less than half (40%) of Gauteng commercial tenants were in good standing in the second quarter of the year, even weaker than KwaZulu-Natal’s 52%.
Interestingly, the lowest rental value segment (less than R10,000/month), recorded the highest percentage of tenants in good standing (54%). The R25,000 to R50,000 segment had the lowest percentage.
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