PROFILE: MIKE RODEL | MIKE RODEL comfortably dodges the morning shoppers in the upmarket Hyde Park shopping centre as he aims for his usual table at JB Rivers. This is his micro-city and he’s the man with the golden key to its halls. It’s easy to lose him in the mall’s crowds: dressed in a suit and tie, the almost-fifty CEO of Hyprop Investments cuts an unassuming figure.
Rodel has been at the helm of one of the JSE’s R110bn retail property industry’s shiniest and highly rated portfolios for just under a year and has been receiving much attention from the market. That’s largely due to property giant Redefine’s proposed bid to increase its stake in the group to 45,2%, which would trigger a mandatory offer to all Hyprop shareholders at R50/unit. Hyprop has also continued to deliver the goods to investors despite recession-hit consumers spending less: the fund has managed to deliver an impressive 15,1%/year average growth in income payouts over the past five years, placing it as one of the sector’s top performers in terms of distribution growth.
If the Redefine bid is successful, it will be able to make changes to Hyprop’s management, but cool as a cucumber Rodel will cross that bridge if and when the need arises.
Despite the importance of the Redefine bid, part of Rodel’s coolness is he can’t help but betray more excitement at the prospect of hands-on management of properties than at corporate manoeuvres and intrigue. He admits new projects – such as refurbishing and extending the Mall of Rosebank – are what get him out of bed in the morning.
He revels in the fact his position requires a number of skills, not just a guy sitting in front of a computer screen all day. But then again, it’s hard to tell with him. His manner betrays little when Hyprop’s sensitive issues are on the agenda and he makes sure to show excitement at the mention of his family or planned trip to the Kruger.
Hyprop manages property gems such as the mentioned Mall of Rosebank (Johannesburg) and Canal Walk (Cape Town) and times are great: schools are on holiday and the Soccer World Cup filled shopping centres with foreigners and locals in a jubilant mood. He doesn’t even flinch at the mention of the economic recession and its effects on indebted consumers. As other retail-focused property companies are putting up “To let” signs at almost 10% of their shops, Hyprop is cruising. Over our hot drinks on a freezing Friday morning the Hyde Park mall is already buzzing.
The country’s property fundamentals are solid, says Rodel. “All we had to do was apply the same principles in the bad times as the good – but just in a more focused way.” He seems completely at ease with managing an R8,6bn portfolio during SA’s first recession in 17 years.
Despite his unassuming manner when he opens his mouth, everyone’s ears prick up. Rodel speaks with a tone my father uses whenever I mention the words “take a few years off and travel the world”. He probably can’t help it. He’s been the responsible, A-student type since his first property management gig. And people can’t help listening. At an SA Property Owners’ Association function earlier this year, the table at which Rodel sat would stop mid-chew to listen to what he was saying. When economists report on vacancies and tighter consumer spending, Rodel is on the ground trying to come up with solutions for tenants to prevent them from defaulting on their rents.
It’s about a tailor-made product offering to shoppers of a specific area, Rodel says. The Hyde Park shopping centre in the moneyed Sandton area caters for a niche market, with retailers such as Charles Greig and Nina Roche. The Glen (south of Johannesburg) is arguably a less trendy mall but the preferred shopping destination for its southern suburbs sees more than triple the foot count (12m last year) than Hyde Park. Canal Walk recorded a massive 20m foot count in 2009.
Fresh out of the Wits engineering school, Rodel became project manager at Cleary Park Shopping Centre in Port Elizabeth, developed by his father’s consulting firm, Rodel Associates Inc. But soon after joining, his father suffered a stroke, leaving Rodel to make decisions without a paternal sounding board during his father’s recovery at the peak of the project. “After opening Cleary Park, the economy was at the bottom of the cycle and there were few opportunities for new shopping centres. So I moved into managing shopping centres, taking up the position as centre manager of Eastgate. I quickly found out that managing big centres was something I was good at and that it was an industry in which you could have a lot of fun.”
In his 20 years in the industry Rodel worked for Liberty Life Properties and Old Mutual Investment Group, where he was GM of its Gateway Theatre of Shopping in Durban and later the regional GM for the Eastern Cape and KwaZulu-Natal. “Managing a shopping centre is like being mayor of a city. One day you’re dealing with a beggar, the next you’re meeting celebrities and politicians.”
Rodel says his engineering background comes in handy on a day-to-day basis, but that he also needs to be an expert marketer, human resources manager and engineer to run a shopping centre. “A range of skills is needed for this job – you need to be a master of all.”
Soon Rodel will be mayor of properties where the tenants live, work and shop – all in the same place – as the shopping centre trend moves towards mixed use. The Mall of Rosebank is being integrated in that way. “The retail industry will see pretty steady growth going forward, but everything will be node-focused, especially around the Gautrain. Offices and industrial developments will start seeing a vacancy take-up this year, but they remain very node-dependent. The trend is also definitely towards densification.”
After not even flinching at the mention of Redefine’s bid, or even at the recession, I throw out the word “Gautrain” for a glimpse of the uncensored Rodel. No such luck. That one of the Gautrain stations will be adjacent to the Mall of Rosebank is due to decisions made before he joined Hyprop, he says. A very welcome development that will boost sales at the mall. However, it has seriously affected shopping flow in the area and construction isn’t expected to let up over the next two to three years. “Hyprop is going to keep me busy for a while,” he says.
As the coffee shop started filling up with ladies-who-lunch, Rodel touched on his family life and, in particular, his love for the band U2 and managing his son’s band, Kinlock. And there it was: the straight-talking, intense and slightly stern human being I was looking for.
It turns out the easiest way to find the real Rodel is with his wife and three kids at their Durban home, where his house borders the Virginia Bush Nature Reserve and he manages to fit in the occasional surf.
ICE-BREAKERSCurrently reading: Hot, flat and crowded, by Thomas L Friedman.
Hobbies: Surfing and cycling and managing his son’s band, Kinlock.
Looking forward to: Watching U2 perform live at San Sebastian in Spain in September.
Investment philosophy: Take reasonable risk and make sure you’re properly looked after for retirement.
Another career you would have considered: Movie director of historical or epic films.
Favourite book ever: The Monk Who Sold His Ferrari, by Robin S Sharma.
Can’t wait for: A Durban/Joburg speed train.
VITAL STATISTICSJob: CEO of Hyprop Investments since August 2009.
Age: 48.
Education: BSc (Civil Engineering).
Marital status: Married to Jean, three children.
Lives: In Durban, commutes to Johannesburg.