Discovery announces the strategic acquisition of its head office, 1 Discovery Place

Discovery announces the purchase of its head office, 1 Discovery Place, in Sandton. The decision marks a significant long term investment in the Group’s future and reflects the Group’s continued confidence in South Africa’s economic prospects.

The acquisition delivers meaningful financial advantages while reinforcing Discovery’s ongoing commitment to operating, innovating and growing in the country.

A financially efficient, economically advantageous transaction
When 1 Discovery Place was built, the economics of a long-term lease were more attractive than an outright purchase. With seven years remaining on the existing lease, the Group initiated a comprehensive review of its long term property requirements.

Economic dynamics have shifted markedly over the period. Lower interest rates and reduced commercial property prices in Johannesburg created favourable conditions to switch from a long-term lease arrangement to fully-funded ownership with optimised space, at a lower overall cost.

The transaction, at R4.05 billion, will result in an immediate and growing net annual cash flow saving, with a net present value benefit of approximately R800 million over the remaining lease period – in addition to securing long term ownership of a landmark asset.

A long-term commitment to South Africa
1 Discovery Place has become central to the organisation’s culture, client engagement and global partnerships. It is both a workplace and a symbol of Discovery’s presence in its home market, in which the Group has thrived.

Adrian Gore, Discovery Chief Executive, commented: “1 Discovery Place has served us exceptionally well. It’s where our culture comes to life and where people from around the world experience Discovery first hand. Purchasing the building reflects our long term outlook, the strength of our Group, and our deep pride in our South African roots. Our plans are made with permanence in mind.”