Prolonged discussions between Hyprop and the Ellerine family concerning the Reit’s acquisition of minority interests in two of the country’s largest shopping centers seem to be drawing to a close, especially following Kevin Ellerine’s resignation from his role as a non-executive director.
The official announcement stated that Ellerine, who celebrated his 59th birthday in October 2025, will resign effective June 1, 2026, “to focus on personal endeavors” after a 17-year tenure on the board.
It has been widely recognized that Hyprop is negotiating to acquire the 20% of Canal Walk and 24.84% of The Glen that it does not already control from the Ellerine Brothers, a detail confirmed by Hyprop CEO Morne Wilken in March.
Read: Hyprop sells 50% of Hyde Park Corner
As a co-owner of these properties, Ellerine was the sole non-executive director without independence. His position on the board’s investment committee could complicate the completion of any transaction aimed at achieving full ownership of both assets.
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His involvement would create a conflict of interest, as he would be engaged on both sides of the transaction.
Hyprop, in partnership with Ellerine Bros, acquired Canal Walk for R1.2 billion in 2003. This shopping center ranks as one of South Africa’s most valuable retail assets and is the largest mall in Cape Town. At that time, Hyprop CEO Pieter Prinsloo referred to Canal Walk as a ‘trophy’ asset.
The consortium triumphed in a fiercely competitive bidding process led by Nedcor. The retail acumen of Hyprop non-executive board member Wolf Cesman (former CEO of Redefine), combined with the extensive property and retail experience of the Ellerine Brothers, played a vital role in securing the transaction.
This super regional center features a gross lettable area (GLA) of 147,600m2 and its acquisition effectively doubled Hyprop’s portfolio, which then included only Hyde Park Corner, The Glen, and The Mall of Rosebank.
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Wilken has not disclosed the exact value of Canal Walk. However, considering its considerable size, prime location, and status as a ‘flagship’ property (indicating a tighter cap rate), informed estimates suggest its value lies between R8 billion and R8.5 billion. This implies that the 20% share owned by Ellerine Brothers is worth approximately R1.6 billion to R1.7 billion.
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Throughout the six-month span from July to December, Canal Walk welcomed 10.2 million visitors. Its retail vacancy rate is a mere 1.4%, one of the lowest in the nation, and numerous brands have recently launched stores at the mall, including Hisense, Chanel, Incredible, Curve Gear, JD Sports, Silki, Shift Espresso Bar, Baseus, Refinery Junior, Sea Weeds & Sea Storm, Whitehouse, iStore Pre-owned, Bootlegger, Paul, Home.Tech.Sleep, and Jet. Some of these retailers have taken over spaces vacated by the resizing of the Edgars store, which was downsized from 11,000m2 to 5,400m2.
Read: Major mall landlord relocating from Gauteng to Cape Town
For FY2025, Hyprop reported R485 million in net property income from its 80% stake in Canal Walk, while income from its 75.16% ownership in The Glen (totaling 78,600m2 GLA) reached R123 million.
Ellerine also holds a 3.4% stake in Hyprop, valued at R771 million, which he indirectly acquired through off-market derivative transactions involving long and short calls (relating to 6,872,660 shares), with strike prices of R31.48 and R47.22, respectively.
