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Hyprop Investments Limited
Integrated annual report 2016
28
HYPROP’S BUSINESS MODEL
INPUTS
OUTPUTS
Business activities
Product and services delivered
Financial capital
Responsibility: Income growth and capital appreciation
Financial
management
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•
Sources of funding: debt and equity
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•
Capital growth
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•
Income growth
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•
Relatively low loan-to-value ratio
•
•
Disposal of non-core assets
Manufactured capital
Responsibility: To ensure manufactured capital generates capital appreciation and income growth
Own and
invest
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•
Own high-quality, dominant shopping centres in large
metropolitan areas in strong economic nodes
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•
Seek expansion and redevelopment opportunities in
existing shopping centres
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Pursue appropriate yield-enhancing acquisitions
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Effective capital and debt management
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•
Real estate investments which provide superior long-term investment
returns
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•
Geographic diversification in high-growth emerging markets
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•
Superior returns for investors
Intellectual capital
Responsibility: Intellectual property and corporate culture are critical to preserve, grow and retain skills
Leasing
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•
Earn rental
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•
Rent collections
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Lease agreements
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•
Manage occupancy level
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Manage tenant arrears
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•
Strong contractual rental escalations
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•
Improved tenant mix
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•
Dedicated leasing executives and national legal executive
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•
Turnover densities
Asset
management
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•
Active internal asset and property management to
maximise efficiencies and pursue opportunities
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•
Property maintenance
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Well-managed portfolio of properties that generate growing income
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Rising property values
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Extracting synergies, e.g. national service contracts
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•
Well-contained cost structure
Information
management
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•
Secure IT systems to improve efficiency of assets,
employees and operations
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•
Integrated electronic property management system
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•
Internal functions such as human resources driven by technology
Stakeholder
communication
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•
Transparent stakeholder communication
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•
Dedicated investor relations manager, marketing executives and compliance
officer
Natural capital
Responsibility: To ensure that operations (occupation and redevelopment of properties, day-to-day activities) limit their impact on the environment
Environmentally
efficient
properties
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•
Energy, carbon emission, water and waste-reduction
targets
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•
Green building principles
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•
Resource management
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•
Environmental strategy
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•
Voluntary participation in global environmental
benchmarks
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•
Reduced environmental footprint
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Environment-specific risk assessments
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•
Projects to improve energy efficiency (such as Clearwater Mall’s solar
photovoltaic plant)
Human capital
Responsibility: To grow and nurture the talent, knowledge and skills of our people
Ethical
leadership
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•
Regulatory compliance and corporate governance
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•
Experienced board
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Hands-on executive management
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•
Strategic risk management and investment strategy to protect and grow the
business
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•
Strong compliance with regulatory requirements
•
•
Top rating in independent governance instrument
Employee
management
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•
Employee development programme
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•
Education and training
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•
Employment equity
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•
Black economic empowerment
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•
Remuneration policy
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•
Health and safety policy
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•
Develop staff productivity
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•
Low staff turnover
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•
Addressing skills shortage
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•
Share incentive scheme to retain executive management and align with
company vision and strategy
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•
Safe and healthy working environment
Social and relationship capital
Responsibility: To ensure interactions with local stakeholders are meaningful and constructive
Corporate social
investment (CSI)
•
•
Hyprop Foundation
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•
Community development
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•
Monitor staff participation in CSI initiatives
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•
Connecting with shoppers
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•
Sustainable social responsibility through education, training and enterprise
development
•
•
Further development of Hyprop Foundation activities and community
interactions
Creating value for stakeholders: inputs, outputs and outcomes defined
As an income-focused REIT, Hyprop creates value for investors and other stakeholders by owning and investing in quality shopping centres, benefiting
from active asset management based on ethical leadership and sound corporate governance principles. This results in sustainable real estate investments,
which generate long-term capital and income growth.