Pareto Group Takes Full Ownership of Premium Sandton Real Estate Assets

Transaction Tuesdays With Talita

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In a major move within the South African commercial property sector, Pareto Limited has elected to acquire sole ownership of the Sandton Convention Centre, Sandton Towers, Virgin Active Sandton and Garden Court Sandton City hotels. The R1.1 billion transaction, which fundamentally shifted structure in early March 2026, sees the property group cut out JSE-listed hospitality operator Southern Sun, to take full control of the Sandton Consortium properties. Originally announced as a joint acquisition on 3 February 2026, the deal has been advancing rapidly towards finalisation in the past week as Pareto formally notified competition authorities of its intent to proceed as the sole acquirer.

The Pareto Group

Pareto Limited is an unlisted property giant wholly owned by the Government Employees Pension Fund (GEPF). Under the leadership of Group Chief Executive Officer Malose Kekana, Pareto has built a formidable portfolio of premier shopping centres. Its existing domestic assets include a minority stake in Sandton City alongside full or significant ownership of Menlyn Park, Westgate, Cresta, Tyger Valley, the Pavilion, Southgate Mall and Mimosa Mall. The group also holds international interests, including a 50% stake in Atterbury Europe and direct ownership of the Mall of Cyprus and the Mall of Engomi.

This latest acquisition marks a deliberate strategic pivot beyond traditional retail. Acknowledging structural shifts in the retail sector where major anchor tenants are reducing their physical footprints, Pareto is actively diversifying its income streams. By expanding into the lucrative conference and hotel sectors, the group aims to secure more resilient returns for the GEPF, which manages the retirement savings of approximately 1.25 million active members and 450,000 pensioners across the South African public service.

The Sandton Convention Centre & Adjoining Properties

Opened in 2000, the Sandton Convention Centre is a 12-storey contemporary venue that has established itself as one of the most technologically advanced business hubs in the Southern Hemisphere. Over its history, it has been operated by Southern Sun and jointly owned by consortia involving the Liberty Group. The centre boasts over 22,000 square metres of event space and has hosted numerous landmark international gatherings. Linked via a skywalk bridge to the adjacent Sandton City shopping centre, it sits at the heart of what is widely known as Africa’s richest square mile. The venue plays a crucial role in the regional economy by drawing significant volumes of domestic and international conference business directly into the surrounding hotels, supporting the broader ecosystem of South Africa’s financial, legal and professional services headquarters.

Beyond the convention centre itself, the transaction encompasses three other highly strategic adjoining properties. The luxurious Sandton Towers is a premium five-star hotel featuring 231 elegantly appointed rooms that connect directly to Sandton City via a skywalk. Catering to a broader market, the Garden Court Sandton City offers 444 modern rooms adjacent to Nelson Mandela Square and serves as a highly convenient base for business travellers attending events at the convention centre. Finally, the deal includes the Virgin Active Sandton building, a premier fitness facility currently leased to the Virgin Active Group. Together, these assets form a highly integrated hospitality and lifestyle precinct

The Transaction

The evolution of this transaction makes it a highly noteworthy deal in the recent M&A landscape. On 3 February 2026 a joint acquisition was announced wherein Pareto would increase its existing 25% holding to 50% whilst Southern Sun would acquire the remaining 50% of Liberty Group's 75% stake for approximately R735 million. However, during the last week,  Southern Sun confirmed via a JSE stock exchange news service filing that negotiations had been terminated. Pareto elected to aggressively exercise its pre-emptive right, a contractual mechanism allowing existing shareholders to match third-party offers. By doing so, Pareto secured Liberty’s entire 75% position for itself at an unchanged deal value of R1.1 billion.

An independent valuation of the target assets in December 2024 placed their aggregate worth at R1.44 billion, generating an audited profit of R153 million for that year. This illustrates both the commercial logic of the acquisition and the premium Pareto is absorbing to secure outright control. The Competition Commission and Competition Tribunal had already approved the earlier joint-acquisition structure, paving a smooth regulatory path for this revised sole-acquirer deal.

Conclusion

This transaction is a significant indicator of consolidation within the South African M&A space, particularly in the premium commercial real estate sector. Amidst a global economic climate still grappling with shifting commercial property valuations and post-pandemic recovery in business travel, securing outright ownership of high-yielding, integrated precinct assets is a highly defensive and strategic play.

The deal mirrors the successful cohesive ownership model seen at the V&A Waterfront in Cape Town, aligning decision-making across retail, hotel and convention assets to drive long-term value. While Southern Sun steps away from ownership, it is expected to retain its management contracts to ensure operational continuity. With competition clearance already secured for the initial framework, the formal transition to Pareto’s sole ownership is expected to be finalised imminently, securing a vital economic node for the benefit of South Africa's public sector pensioners.