South Africa’s REIT sector delivered a strong performance in April 2025, gaining 6.9% and outperforming both equities (4.3%) and bonds (0.8%).

Investor sentiment was buoyed by expectations of accelerating growth in distributable income and the likelihood of interest rate cuts by SARB.

Ian Anderson, Head of Listed Property and Portfolio Manager at Merchant West Investments, and who compiles the monthly SA REIT Association’s Chart Book, says April was a sweet month for the sector, which continues to offer value, trading at historically high discounts to net asset value (NAV) – excluding the Covid-19 period.

SA’s REITs also saw robust trading activity with over R12.2 billion in turnover – the highest monthly volume for 2025 so far, indicating strong investor appetite amid rising prices.

SA Corporate Real Estate led the gains with a 15.3% return, followed by Attacq Limited (+13.3%), Resilient REIT (+10.9%) and Redefine Properties (+10.5%). “There was little company-specific news to drive these moves, but a more favourable macro-economic and political backdrop certainly played a role,” says Anderson.

In April 2025, consumer inflation fell below SARB’s lowest target range, strengthening expectations of a rate cut at the upcoming Monetary Policy Committee meeting in May, with the market now pricing in at least one more cut later this year. Anderson notes that lower interest rates not only support property valuations through reduced discount rates but will also lift distributable income growth across the sector in 2025 and 2026, especially with average loan-to-value (LTV) ratios sitting between 35% and 40%.

A stronger Rand and lower oil prices are likely to keep inflation muted, giving SARB room to ease rates further with the proposed 0.5% VAT increase suspended.

Globally, easing trade tensions between the US and China, along with US President Donald Trump’s decision to delay tariffs on several countries, added to the positive sentiment, benefiting global markets and by extension, SA REITs.