Octodec to sell Killarney Mall for R397.5m

Octodec Investments Limited has officially entered into a definitive agreement to dispose of 100% of its shares and claims in Killarney Mall for a consideration of R397.5 million.

Listen: Octodec close to Killarney Mall sale

The transaction, signed on 24 February 2026 with AJPG Property 1 Proprietary Limited, marks a major milestone in Octodec’s broader capital-allocation strategy to recycle non-core assets.

Strategic rationale: From recycling to reinvestment

The decision to divest from Killarney Mall follows its strategic identification as an asset for recycling.

Management believes that the group can unlock greater value by redirecting capital away from this established retail and office landmark towards future projects and debt reduction, in line with the revised strategy reported in FY2025.

Killarney Mall, situated at 60 Riviera Road, is a mature shopping centre with an operating history spanning over 45 years.

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The property comprises 36 225m² of retail space and 11 245m² of office space, notarially tied across eight erven totalling over 5.5 hectares.

As of 31 August 2025, the property carried a valuation of R407.6 million based on a capitalisation-of-income framework, with a weighted average rental of R155.20 per m².

Financial impact and transaction terms

The disposal consideration will be settled in cash on the effective date, which will be the last day of the month in which all suspensive conditions have been met.

For the year ended 31 August 2025, the profit attributable to the net liabilities of Killarney Mall Properties was R16.6 million, with the net liabilities themselves recorded at R38.6 million.

Octodec’s directors have expressed satisfaction that the R397.5 million consideration represents fair market value.

The final payout remains subject to an adjustment account based on the income, expenses, and working capital of the subsidiary as of the effective date.

If the working capital is positive, the consideration will be adjusted upwards; conversely, a negative value will result in a downward adjustment.

Navigating conditions precedent

The finalisation of the deal rests on several standard conditions:

• The purchaser must be satisfied with the outcome of a due diligence investigation within 60 days;
• An unconditional banker’s guarantee must be furnished following the due diligence period;
• Consent must be obtained from Nedbank Limited for the release of existing mortgage bonds and suretyships; and
• Approval must be granted by the competition authorities under the Competition Act.

As the disposal is categorised as a Category 2 transaction under JSE listings requirements, it does not require formal shareholder approval.

Interestingly, the beneficial owners of the purchaser have declined to consent to the disclosure of their identities.

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