Real estate investment trust (Reit) Growthpoint Properties is going to great lengths to ensure its buildings and tentants’ businesses remain powered up during South Africa’s electricity crisis and more intense bouts of loadshedding.

The Reit has installed 13.5 MW of renewable energy generation across more than 20 rooftop and carport solar plants and plans to double this capacity by June.

Growthpoint also has 332 MW of generation potential from more than 330 backup generators, which helps to keep the lights on at nearly 3 000 businesses.

At least 1 053 shops, 833 office tenants and 38 industrial tenants can continue operating throughout loadshedding, owing to Growthpoint’s national energy management programme, confirms Growthpoint Properties South Africa CEO Estienne de Klerk.

He adds that just under 1 000 tenants at the V&A Waterfront, in Cape Town, which the Reit co-owns, have access to backup power from the precinct’s 48 generators.

Growthpoint provides backup power to more than 70% of its office portfolio, or 1.2-million square metres of offices, through 223 generators. The Reit uses technology to monitor diesel levels and has a supply chain of in-house capabilities and external providers to keep them fuelled and operating.

In the remainder of office space in the portfolio, most tenants have their own generators, or are based in areas that do not experience significant loadshedding. Growthpoint continuously assesses the requirement for more renewable energy and backup generators for its tenants.

Moreover, the Reit provides backup power for three industrial parks in its portfolio, as well as for nine of its malls.

“In this way, Growthpoint is helping much of South African businesses avoid disruption during power outages and, in the process, safeguard businesses, jobs and livelihoods,” De Klerk comments.

He explains that the Reit strives to provide additional standby capacity to support tenants operating fast food and sit-down restaurants, which are severely impacted during bouts of loadshedding.

Growthpoint has spent R47-million on diesel to power all its buildings in the six months ended December 31, 2022. The V&A Waterfront independently spent R14.8-million on diesel in the same period.

De Klerk says the costs are substantial, but the burden is mostly shared with tenants, who pay for their own additional diesel consumption costs.

SOLAR INCOMING
While backup power helps to ensure business continuity, it does take its toll on the environment and weighs on the Reit’s strategy to be carbon neutral by 2050.

To this end, Growthpoint continues to advance its programme of green building and green energy, which it launched a decade ago.

“Our investment in solar power reduces our reliance on the national grid. There is a great need for this right now and amping up our investment in solar makes sense for our strategic, operational and environment, social and governance goals,” De Klerk states.

Of the Reit’s 24 solar installations, half are at office and mixed-use properties, nine at shopping centres and three at industrial buildings. However, retail installations represent the highest capacity, accounting for a combined 9.4 MW.

Growthpoint’s largest solar installation undertaken this year is a 2.5 MW plant at Paarl Mall, in the Western Cape, which is paired with a 4.5 MWh battery system to form a hybrid renewable energy and storage system. This is the first battery system of its size to be used at a shopping centre in South Africa, and Growthpoint is currently evaluating battery backup for other properties in its portfolio.

With 13.9 MW of solar projects in various phases of construction, Growthpoint is on track to achieve its target of 27.4 MW of installed solar by June 30 – the end of its current financial year.

By adding potential solar projects to this list on an ongoing basis, Growthpoint is helping to chart the way forward for renewable energy in commercial real estate in South Africa and for its tenants.