Delta appoints a permanent CEO, and he has a huge task ahead of him

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Delta Property Fund has appointed seasoned construction and property executive, Siyabonga Mbanjwa, as its permanent CEO. Photo: Supplied
Delta Property Fund has appointed seasoned construction and property executive, Siyabonga Mbanjwa, as its permanent CEO. Photo: Supplied
  • Delta Property Fund has named Siyabonga Mbanjwa as its permanent CEO.
  • He will take over the reins in February 2022.
  • Mbanjwa comes after a rocky year for Delta, which lost its CEO, CFO and COO in 2020 and is battling high vacancies in its buildings.

Delta Property Fund has appointed  seasoned construction and property executive, Siyabonga Mbanjwa, as its permanent CEO more than a year after a number of its executives quit.

Mbanjwa will take over the reins as a permanent CEO on 1 February 2022. He has more than 24 years of experience in the construction and property sector and has occupied roles at Old Mutual Properties, Crowie Holdings and SENER.

He is currently the MD of Pace Property Group, which was part of developing malls like Bridge City Shopping Centre in Durban and The Zone@Rosebank in Johannesburg.

Delta has been operating with an interim CEO since July 2020 when several executives, including Delta's founding CEO Sandile Nomvete, left after accusations of wrongdoing and other unethical business dealings.

However, the executives maintained that they did nothing wrong.

Still, the allegations left Delta in a pickle as it was forced to withdraw its 2020 financial statements and restate them. The JSE also suspended trade in the company's shares between December 2020and July this year.

 However, in the 2021 integrated report, the chairperson of Delta's board said the company was starting to track in the right direction. The most recent financial statements that the company published on Monday showed that Delta is also doing better financially. It recorded an after-tax profit of R139 million from a loss of R94 million in August 2020.

However, Mbanjwa is still in for a lot of work. 

Delta's rental income has been declining as leases that expire fetch lower rental amounts than before. The company is also battling increasing vacancies in its properties. Vacancies sat at 27.2% in the six months ended on 31 August.

The lion's share of its office portfolio is either vacant or let out on month-to-month leases. But even the industrial portfolio, which performed comparably better during the pandemic, was 60% vacant.

As for Delta's debt levels, its loan-to-value improved marginally to 55.7%, and the firm expects it to reduce to approximately 54.7% by the end of its current financial year. However, this is still the highest among its peers, given that Sisa Ngebulana's Rebosis now expects to reduce its LTVs to 42% from 72% after the pending sale of 35 properties.

Mbanjwa will also oversee major capital projects that Delta has undertaken and make sure that they generate income for the company once complete, while the pandemic continues to shift many of the property sector's fundamentals.

In the six months to end-August, the company's capital expenditure amounted to R62 million. The company has a R183 million capex programme. Most of the money will go towards upgrades to existing office buildings, which might help Delta attract and retain tenants.

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