Bartlett Site: Ekurhuleni January 2007 Feasibility Study: Demographics & Retail Potential Note: This project should be regarded as confidential as it contains Data, Information and Intellectual Property of Fernridge Consulting and Retail Network services - Copyright (Limited Distribution) Copyright 2007: Fernridge Consulting.

This report aims at assessing the feasibility of a proposed site for a new Convenience centre located within the Bartlett, Ekurhuleni area. The proposed site is situated on the corner of Ridge & Elizabeth Roads. A demarcated catchment area was digitized in order to extract the 2007 Fernridge Household counts and existing retailers. The site was assessed by physical inspection as well as aerial photography. By using the Census 2001 data we were able to initiate a demographic comparison between the proposed catchment area and the surrounding precinct. Future developments were also taken into consideration for future growth figures. The final points of the report focus on our retail potential model which has been followed by an executive summary. Copyright 2006: Fernridge Consulting. Introduction Copyright 2007: Fernridge Consulting

Copyright 2006: Fernridge Consulting. Overview/ Landuse Copyright 2007: Fernridge Consulting OR Tambo International Airport East Rand Mall DENEL Aviation Benoni Lake Golf Club The Site To Kempton Park To Benoni To Johannesburg

Copyright 2006: Fernridge Consulting. Catchment Area Copyright 2007: Fernridge Consulting OR Tambo International Airport East Rand Mall DENEL Aviation Benoni Lake Golf Club To Kempton Park The Site To Benoni A primary catchment area was delineated in order to assess the demographic profile and potential in the immediate vicinity of the site. To Johannesburg

Copyright 2006: Fernridge Consulting. Current Retail Potential Estimate (RPE) Copyright 2007: Fernridge Consulting Woolworths Food Potential: benchmark R60,000/m² trading density benchmark 15% market share - Monthly turnover of ± R2.6m - Warranted floor space of 514m² selling. Pick ‘n Pay Potential: benchmark R30,000/m² trading density low benchmark 25% market share - Monthly turnover of ± R4.3m - Warranted floor space of 1712m² selling. Anticipated trading density (Rand / m² / Year) Anticipated market share scenario’s Monthly Expenditure No of Households Expenditure Model

Copyright 2006: Fernridge Consulting. Executive Summary Copyright 2007: Fernridge Consulting The proposed site is very well situated in a somewhat confined area. Barriers like the Airport to the west and the N12 highway to the south are enhancing the catchment to a captured market. C/o Elizabeth Rd and Ridge Rd is very well located in the catchment. This is a relatively busy crossing. The quantity of the traffic will be moderate but it is expected that the quality of passing traffic will be high. Due to the neighborhood character of the proposed centre the latter might only be achieved if the convenience offer of the centre is emphasized strongly. The proposed site will be a stand alone centre, thus synergy is limited, but on the other hand, direct competition is also minimized. The value density modeling is an indication that the area is on par with the rest of the catchment in terms of the monthly food expenditure. The catchment is characterized by a strong A – C income bracket. Rapid growth of residential units have occurred in the area, and is a positive for the proposed shopping centre development. We believe that a Woolworths Food and a Pick ‘n Pay will complement each other in the centre. Taking in consideration that each one of these store’s benchmark trading densities (Woolworths: R60,000/m² and Pick ‘n Pay: R30,000/m²) with a expected 15% and 25% market share respectively, will warrant a 514m² store (selling) for Woolworths and a 1712m² store (selling) for Pick ‘n Pay. The expected monthly turnover of The Woolworths will be ± R2,6m and for Pick ‘n Pay a ± R4,2m monthly turnover. A Convenience Centre of 10,000m² GLA can be justified in the next ± 2 years given the high growth in the area.

Recommended tenant mix according to the following guidelines (for the 10,000m² GLA Convenience centre): Food National supermarket – main anchor Pick ‘n Pay (± 2,200m² GLA) and Woolworths Food (± 700m² GLA). Specialty Stores Secondary anchor – Clicks. Line shops such as salon, DVD, music, pharmacy etc. Service component including Bank / ATMs and Post Office. Restaurants & Take Aways (Wine & Dine) One or two well known Fast Foods like Wimpy, KFC and a Coffee Shop Suggested Tenant Mix: In our opinion the centre should be created into a prominent and convenient node that will attract people from the surrounding neighborhoods. The tenant mix should be sufficient to attract the middle-to-upper income bracket. Executive Summary Copyright 2006: Fernridge Consulting

Sybrand Strauss (Director) Fernridge Consulting PTY LTD South Africa Tel: Fax: Cell: Marinus van der Merwe (Business Analyst) Fernridge Consulting PTY LTD South Africa Tel: Fax: Cell: Contact Details Copyright 2007: Fernridge Consulting