Welcome to the hotel of 2119

Intergalactic getaways, fast-food nutrient pills, 2-3 hour working days and adaptable, personalised rooms that can transport guests everywhere from jungles to mountain ranges; in celebration of its 100th anniversary, Hilton (NYSE: HLT) predicts the future trends set to dominate the travel and hospitality industry in the next 100 years.

In a report supported by expert insight from the fields of sustainability, innovation, design, human relations and nutrition, findings reveal how the growing sophistication of technology and climate change will impact the hotel industry in the future.

Key predictions for the hotel of the future include:

Personalisation is king

  • Technology will allow every space, fitting and furnishing to continuously update to respond to an individual’s real-time needs – the lobby will conjure anything from a tranquil spa to a buzzy bar, giving every guest the perfect, personal welcome
  • From temperature and lighting, to entertainment and beyond, microchips under the skin will enable us to wirelessly control the setting around us based on what we need, whenever we need it

The human touch

  • In a world filled with AI, human contact and the personal touch will be more critical and sought after than ever
  • Technology will free up time for hotel staff to focus on what matters most: helping guests to connect with one another and building memorable moments

‘Sustainable everything’ – The role of responsibility

  • Only businesses that are inherently responsible will survive the next century
  • Sustainability will be baked into everything about a hotel’s design – from weather-proofed domes, to buildings made from ocean-dredged plastic
  • Hotels will act as the town hall of any community, managing local resources and contributing to the areas they serve with community-tended insect farms and vertical hydroponic crop gardens

Menu surprises and personalisation

  • Our diets will include more plant-based recipes and some surprising sources of protein – Beetle Bolognese, Plankton Pies and Seaweed Green Velvet Cake will be menu staples!
  • Decadent 3D-printed dinners and room service will provide unrivalled plate personalisation
  • Chefs will be provided with biometric data for each guest, automatically creating meals based on preferences and nutritional requirements

Futuristic fitness and digital detoxes

  • Outswim a virtual sea turtle in the pool, or challenge yourself to climb the digital face of Mount Everest, your exercise routine will be as unique as you are. What’s more, exercise energy generated from workouts will be used to power the hotel, providing a zero-impact, circular system. Guests could even earn rewards based on reaching workout targets
  • Pick up where you left off with trackable workouts and holographic personal trainers
  • Offline will be the new luxury as we seek to find moments of tech-free time

“Since its inception in 1919, Hilton has pioneered the hospitality industry, introducing first-to-market concepts such as air-conditioning and in-room televisions. Last year, Hilton also became the first hospitality company to set science-based targets to reduce its environmental impact,” said Simon Vincent, EVP & president, EMEA, Hilton. “We enter our second century with the same commitment to innovation, harnessing the power of our people and technology to respond to guest demands. Our research paints an exciting future for the hospitality industry, highlighting the growing importance of human interaction in an increasingly tech-centric world.”

Futurologist Gerd Leonhard said: “In 2119 we will still be searching for unique experiences, but they will be more personalised than ever. 100 years from now hotels will have to create opportunities to converse, collaborate and connect, delivering moments that matter, individually, to each and every guest.”

 

 

New luxury hotel brand launches in Cape Town

Labotessa, a 17th century congregational church now turned lifestyle hotel, opens in Cape Town in August 2019. Originally built in the early 1700s, the intimate, seven-roomed property is one of the oldest buildings in South Africa and the debut project in the Labotessa portfolio by first-time hoteliers Jan Fourie and Johan du Plessis. The South African owners and founders were inspired by the opportunity to meld heritage and old-world elegance with visionary new world design.

Situated in a restored national monument structure in the heart of the city, Labotessa is the only hotel on historic Church Square. This landmark lifestyle property blends luxury and personal service with the independence of residential living. Each of the hotel’s seven spacious suites features private elevator access, a balcony and sweeping views of the city, Lion’s Head and Table Mountain.

On the ground floor, guests and locals can enjoy the newest outpost of Starling’s, a beloved local cafe utilizing organic and ethically sourced ingredients. The cafe will spill out onto the square and sits adjacent to the hotel’s Diptyque boutique, a public concession for the revered international perfumery. All the hotel’s suites will carry the Diptyque range of toiletries, making Labotessa the 11th hotel worldwide to have gained this privilege. From the ground floor, an antique balustrade guides guests to the reception area on the mezzanine level, with views of the property’s classic fireplace, original chandelier and plush velvet armchairs.

The founders conceptualized every design element in the hotel to evoke 17th century grandeur fused with a relaxed atmosphere. Commissioned works by local artists and antique furniture weave a narrative inspired by the city’s European influences. Each guest room is unique in its design and configuration. Labotessa is home to one of Cape Town’s largest penthouse suites: The Governor Suite.

The Governor Suite: The three-bedroom Governor Suite is named after Simon Van der Stel, the first governor of the Cape. At 300 m2 in size, the suite spans two floors with breathtaking views of Church Square, Signal Hill, and Table Mountain. A completely new build on the hotel’s top floor, the Governor Suite features distinctly modern touches such as a floating staircase and private plunge pool looking out through the balcony’s glass walls.

Ideal for friends, families, and groups traveling together, the Governor Suite has a full kitchen equipped with two ovens, a 10-person dining table and two lounge areas. A modern fireplace is flanked by a padded leather window seat, lending the hotel’s signature sense of comfort to the space. In the bedrooms, en-suite bathrooms with freestanding bathtubs overlook the city of Cape Town.

Six Signature Suites: Accessible via private elevator from the hotel’s mezzanine level, the Signature Suites feature living and sleeping areas separated by glass paneling. A palette of petrol blues, warm taupe and burned orange is complemented by Persian rugs dotted throughout. High ceilings and French oak floors emphasize the spaciousness of each 37 m2 room, and en suite bathrooms feature blue subway tiles and Calacatta marble.

Labotessa is surrounded by several architectural and cultural treasures including the monumental Groote Kerk, the Slave Lodge set beneath the unmistakable mountainscape of Lion’s Head, the Company Gardens, and the Parliament buildings. The hotel is in close proximity to the V&A Waterfront and within walking distance of some of Cape Town’s top restaurants, coffee bars, cafés and nightclubs. One of Cape Town’s newest and most popular fine dining establishments, FYN, is located next door and features a menu of Japanese-inspired cuisine fused with South African dishes.

For more information on the hotel visit www.labotessa.com

 

Property Sector Charter Council strives for impactful solutions in the property sector

This year has been a busy and eventful one for the Property Sector Charter Council (PSCC). The council, which monitors and evaluates transformation in the South African property sector, has embarked on several collaborative projects which expand its scope significantly. At its annual seminar, the PSCC released its 2019 State of Transformation of the Property Sector Report and announced a new intervention for addressing transformation challenges in the sector.

“The quality of our engagement with the many participants in the property sector this year has shown a tremendous improvement,” says PSCC chairman, Sedise Moseneke. “Overall, we are seeing far more collaboration in almost every area. This is important for us to work effectively and synergistically as a sector, and we are very encouraged by it as it allows us all to do so much more,” he adds.

2019 State of Transformation of the Property Sector Report

PSCC CEO, Portia Tau-Sekati, present the findings of the transformation report, which shows a mixed picture of the sector’s B-BBEE performance over the past year. Transformation remains a key element of economic transformation in the country, especially given the contribution that the sector makes to overall GDP. Yet, progress towards certain transformation milestones is still limited and slow.

The 2019 report is based on two pieces of legislation: the 2012 Property Sector Code, and the 2017 Amended Property Sector Code. The report reveals that property sector is at Level 5 in terms of its transformation B-BBEE recognition level – dropping from level 4 in the 2018 report. Although this is not the best performance, it was a reasonable effort considering the change in the recognition levels which took effect during the year.

“Although it is encouraging to see continued transformation efforts in the sector, progress in certain areas has been slow and we believe that the situation is still less than ideal,” notes Tau-Sekati.

Analysis based on key elements of the 2012 Property Sector Code reveal that the ownership score, which has an overall weighting of 20 points on the scorecard, shows that the industry improved overall from a score of 16,67 to 17,04 weighting points – a change from 83% to 85% in this category. “Whilst this is encouraging, funding models still need to be further considered and reviewed, as the long nature of the process translates into limited progress,” she explains.

Encouraging results were seen in the category of employment equity, where the industry showed an improvement from a very poor 33% in 2018 to a 49% performance achievement against target in the 2019 report. In the areas of skills development and management control, results were much the same as last year, with the industry’s performance in these areas being rated at 65% and 56% respectively. “We are pleased that even in the areas of the scorecard where performance is poor, the overall direction is still positive,” says Tau-Sekati. “However, much more still needs to be done.”

The report forms one of the cornerstones of the PSCC’s work, tasked as the industry body responsible for measuring and monitoring transformation. It is widely acknowledged by the industry as an important tool in this respect, as evidenced by its generous sponsorship by SVA Architects. “We are proud and honoured to be the sponsor of the 2019 State of Transformation of the Property Sector Report, it is an important partnership in the property sector and shows how committed we are as SVA about transformation,” says SVA MD, Sandi Mbutuma.

New minister and chairman to be introduced

The event saw two new appointments introduced. The first was Dr Sedise Moseneke, who stepped into the role of PSCC chairman on 1 March. Moseneke takes over from industry veteran Saul Gumede, who was the PSCC’s founding chairman, and who has done sterling work to advance transformation in the industry in this role. “Being chairperson of the PSCC will allow me to give back to the industry, to contribute to the process of making meaningful changes in transformation, and to help drive change to address the gaps that exist,” says Moseneke.

The second introduction was that of the new Minister of Public Works and Infrastructure, Patricia de Lille. Her appointment came after the recent government restructuring by President Cyril Ramaphosa, which saw the combining of the Departments of Public Works and Infrastructure, in an effort to reduce government’s wage bill. In this new role, Minister de Lille will be the line minister which the PSCC reports to, and the leader of the industry from the public sector’s point of view.

Property Sector Skills Foundation launch

An exciting component of the seminar was be the official launch of the Property Sector Skills Foundation. The aim of this foundation is to enhance the overall level of skill in the industry, building a pool of talent which provides a resource for property companies in South Africa from which to draw on.

The project is one which PSCC chairman, Sedise Moseneke, has highlighted as critical for transformation going forward. Excellent work has already been done to promote property careers to school-leavers and students. What is needed now is to assist new entrants, nurturing talent and growth into the industry with developing the right platform to allow them to advance their careers, and prepare them for senior roles. This is important given that there is still a lack of black and more particularly female representation at ownership, control and participation levels in the industry.

The PSCC believes that through the launch of the Property Sector Skills Development Foundation, the body can lead the change that needs to take place. “We believe that through taking a holistic and structured integrated approach, we can address skills development in the industry comprehensively,” says Tau-Sekati. “There is power in collaboration – we can do it better if we do it together.”

An industry first: Property Portal SA

In a first for the property industry in SA, the PSCC will also launched the Property Portal SA – a digitally-driven platform which will function as a single resource for industry information. “With so many different sources of information available, it can be confusing for anyone to know where to begin,” says Tau-Sekati. Whilst all the original sources of information will remain, the Property Portal is intended to be a first point of reference, which will then direct users in their search process to the appropriate platform. With its tag-line of: “Your platform and gateway to everything property in South Africa,” the one-stop-shop portal will enable access to relevant industry content.

The Property Portal SA can be accessed at https://propertyportalsa.co.za/

Changes on the way for REITs

By Duncan Dollman, partner in the Mazars Real Estate Division

The South African listed Real Estate Investment Trust (SAREIT) association has followed international reporting trends by developing its own branded guidelines for measuring the performance of REITs. The SA REIT association is made up of the top locally listed REITs and recently issued their best practice recommendations (SA REIT BPR). Inconsistency in reporting certain key measures, such as the distributable earnings amongst members, has resulted in the proposed second edition of these best practices.

There is international precedent for this development. In the US, one of the metrics used by the Securities and Exchange Commission (SEC) listed REITs is the funds from operations statement, and the European Public Real Estate Association (EPRA) has developed its own copyrighted best practices recommendations for European REITs.

One standard for global REITs is not possible because of the differing reporting frameworks in terms of which listed REITs report their performance. South Africa has adopted the International Financial Reporting Standards (IFRS) framework, and reconciliation of the SA REIT defined metrics back to IFRS is encouraged.

Reporting of non-IFRS performance measures has always been regulated by the Johannesburg Stock Exchange Listing Requirements (JSELR). In the face of increasing use by issuers in trying to communicate industry specific information that would be useful for investors, the JSE has now responded by issuing for comment a new Practice Note 4/2019 which incorporates the International Organisation of Securities Commissions (IOSCO) principles of consistency and transparency.

This will avoid the confusion around the use of the term pro forma when applied to non-IFRS measures and will allow the JSE to prescribe the method and disclosures required when the newly defined performance measures (PM) are reported.

Comparing the performance of REITs has been difficult without analysing the adjustments that each has been making to its IFRS reported results and ratios. Following the SA REIT BPR will result in more transparency and easier comparability.

The SA REIT has further suggested that these measures should be contained in a separate annexure and be reported on by the company auditors. These performance measures will also have to be prepared in terms of the JSE practice note requirements once it has been adopted. The company directors will now also be requested to give a confirmatory statement about compliance with the presentation of PMs.

In addition, the CFO and the chair of the audit committee will be required to sign a declaration relating to the financial reporting procedures adopted to identify PMs, when submitting annual financial statements to the JSE.

The JSE will simultaneously amend its listing requirements to place the responsibility for compliance with the practice note on directors. No implementation date has been proposed for introduction of the JSE practice note which is still in discussion phase, but the SA REIT is proposing that its BPR will be effective for years commencing on or after 1 January 2020.

Mazars is an international, integrated and independent organisation, specialising in audit, accounting, tax and advisory services across a wide range of markets and sectors. Mazars operates throughout 89 countries and territories that makes up its integrated partnership. Mazars draws upon the expertise of 23 000 women and men, led by 1 040 partners working from 210 offices worldwide.

 

 

Workshop17 opens at The Harrington in Cape Town CBD

Workshop17 has opened a third co-working space in Cape Town, located at The Harrington in the vibrant, up-and-coming East City Precinct. A unique state-of-the-art collaborative workspace in a key location, it provides 30 customisable private offices, hot-desking, dedicated workspaces, meeting and boardrooms with cutting-edge presentation and video conferencing equipment, a Bootlegger coffee corner, a kitchen, lounge and breakaway spaces.

 

Workshop17’s newest address at The Harrington is in a landmark Cape Town building owned and completely redeveloped by Blend Property Group. The multi-tenanted retail and commercial building is set among street-side eateries, cafes and galleries in an area peppered with artisans, entrepreneurs and great new entertainment and social venues.

 

It features ground floor retail, including Bootlegger Coffee Company and East City Cycles, and five floors of offices. Accessible and well served by commuter services, including the MyCiti bus stop, it also offers change rooms, shower facilities and bicycle storage.

 

Outside, the redeveloped The Harrington retains some elements of its well-recognised original façade with the addition of an eye-catching modern entrance and Art Deco detail that has become a symbol of the new energy and potential in this neighbourhood, which is experiencing a surge of regeneration.

 

Inside, the building features an exceptional art collection and installations in its foyer gallery, which is open 24/7 and managed by OPEN24HRS. The artistic design extends throughout the building and into the Workshop17 space, which occupies one full floor.

 

Paul Keursten, CEO and co-founder of Workshop17, says, “Each Workshop17 has its own unique design inspired by its surroundings and community. At The Harrington, the buzz, bustle and creativity of the surrounding street life have been captured in an eclectic, cosmopolitan space. We believe it is a great addition to the co-working options that Workshop17 offers in the Mother City.”

 

The Harrington is one of four Workshop17 locations in the region, which also includes The Watershed at the V&A Waterfront, Tabakhuis in Paarl, and its soon-to-open Kloof Street location.

 

“Old Mutual and Standard Bank, as examples, both house innovation teams with us. This is because Workshop17’s collaborative spaces have proven to be fertile ground for bringing new ideas to life,” notes Keursten. “Our spaces foster innovation and help businesses – big and small – attract and retain valuable talent by appealing to the younger generation of workers,” adds Keursten.

 

Workshop17’s plug-and-play, hassle-free offices come complete with everything from desks and chairs to superb connectivity to on-site community managers. Supremely flexible, it is easy for businesses to grow and shrink inside its space. It takes care of everything, so the only thing members have to focus on is their business.

 

Importantly, its co-working spaces are unique in that they offer more than simply a place to work; they actively foster a thriving community. Workshop17 connects members who can help each other grow and holds regular public events supporting entrepreneurship, learning and networking in various fields.

 

Workshop17 uses its leading skills in local co-working spaces and its excellent operational ecosystem to create and manage spaces where start-ups, experienced entrepreneurs, professionals, corporates, freelancers and individuals can work, meet, collaborate and innovate. It is 50% co-owned by JSE-listed property company Growthpoint Properties. Since its first coworking space opened in 2012, Workshop17 has grown into seven iconic workspaces hosting over 2 000 members and 500 companies. More locations are in the pipeline.

 

 

Bringing e-learning to the conveyancing market

Registered SASSETA assessor and national course facilitator for the Black Conveyancers Association Training Academy, Tasneem Kanjee, has developed an innovative solution for individuals wishing to gain skills, or upskill,  in the area of conveyancing. Through Introduction to Conveyancing, an e-learning course offered by LexisNexis South Africa, Kanjee offers practical and targeted content to meet the needs of this multi-player sector.

“A major benefit of this course comes in its online nature. Course participants can work at their own pace, progressing through the modules in their own time. This not only makes the course accessible to working individuals wanting to increase their skill sets, such as entry level secretaries with limited exposure to the field of conveyancing and those new to conveyancing, but also makes it ideal for school leavers with matric qualifications wanting to pursue a career in this space. Being able to work through the course remotely is highly important in a country such as South Africa, where access to training, courses and transport can be cost-prohibitive.”

Kanjee, founder of Our Best Practice Training Solution, says that the course offers relevant insights into the role of the conveyancer and the processes involved in transferring property ownership. With 15 years conveyancing experience, Kanjee also lectures at the South African Law School, equipping legal support staff with the relevant skills to succeed in the conveyancing profession.

Introduction to Conveyancing introduces common terminology used in the conveyancing process and provides course participants with a thorough understanding of the property transaction process, the role-players and software applications such as Lexis® Convey and Lexis® WinDeed which enhance the ability to effectively transact in the highly competitive South African property industry.

There are seven modules in the course, which each need to be completed, one at a time with a minimum of 70% pass rate to unlock the next component. The course takes participants through an introduction to property ownership in South Africa, the transfer registration process, bond registration and cancellation processes, the role of the conveyancer and conveyancing secretary and provides an understanding of the Deeds office and its purpose. A working understanding of the use of Lexis® Convey and Lexis® WinDeed, the most commonly used conveyancing software platforms, will also be achieved on the course.

For further information or to register, please visit:  https://www.lexisnexis.co.za/lexisnexis-elearning/introduction-to-conveyancing-short-course

About LexisNexis® Legal & Professional

 

LexisNexis Legal & Professional is a leading global provider of legal, regulatory and business information and analytics that help customers increase productivity, improve decision-making and outcomes, and advance the rule of law around the world. As a digital pioneer, the company was the first to bring legal and business information online with its Lexis® and Nexis® services. LexisNexis Legal & Professional, which serves customers in more than 130 countries with 10 000 employees worldwide, is part of RELX Group, a global provider of information and analytics for professional and business customers across industries.

In South Africa, LexisNexis® has been assisting companies and professionals to remain abreast of changing legislation and shifts in the regulatory environment for over 80 years, combining the best of local knowledge in Butterworths with leading-edge tools and online solutions that have positioned the company as a pioneer of legal technology. LexisNexis South Africa’s business units include LexisNexis Legal Information and Compliance, LexisNexis Data Services, LexisNexis Business Software Solutions and LexisNexis Academic.

 

 

 

Smart building automation now possible with Hager range from EM

Exclusively for CIPN

Cost-effective and easy-to-install smart building automation solutions are now possible with the latest Hager systems introduced locally by leading supplier ElectroMechanica (EM). The Hager domovea solution has been showcased at Swarovski Lighting’s new-build showroom in Green Point, Cape Town. This is a flagship application for building automation, which is gaining in popularity in South Africa, due to a growing requirement for energy efficiency, convenience, and sustainability.

The Hager solution forms part of EM’s extensive product range of high-quality industrial electrical goods, motor control switchgear, and electronic automation products for a range of clients and market segments. End users include wholesalers, consultants, building contractors, system integrators, switchboard and panel builders, and also engineering procurement companies.

The Swarovski Green Point project commenced towards the end of 2017, and was completed in Q1 2018. “Our brief was to supply a centralised control of all of the light fittings on display,” Ryan Whitelaw, EM product manager for building automation, explains.

Not only was this for control of the premises, with the activation of various themes such as for morning and for night, but the aim was also for the salespeople to be able to demonstrate the products to customers via tablets. “The specification of the lighting products is quite technical, which is why we proposed the advanced Hager solution,” Whitelaw explains.

For Swarovski specifically, EM specified high-quality Hager B7 switch frames, which feature a clean design, vega D enclosures featuring a ready-to-mount configuration, and the domovea automation dashboard, which is controllable from a smartphone or tablet, as well as the wall-mounted keypad.

The domovea dashboard provides for intuitive control of a range of devices, from lights to shutters, heating, air-conditioning, and other systems, from single rooms to entire floors. The main advantage is that it allows for easy control from a single point, including remote control via an app available for iPhone, iPad, and Android devices. The dashboard even allows for energy consumption data to be stored for comparison against various timeframes, from days to months.

Another Hager building automation system, coviva, is ideal for the burgeoning South African market as it does not require extensive construction work in order to be installed, or even additional cable routing, as it is an entirely retrofittable wireless solution.

The coviva system is ideal for retrofitting, modernising, or upgrading, and also dovetails with the higher-end Hager domovea KNX system. “The latest launch means EM can now comfortably supply either spectrum of the market demand, and can therefore cater for a broader range of clients, from home owners to commercial, retail, hospitality, and industrial.”

The secret to the cost-effectiveness of the coviva system lies in its micromodules, which are easy to install, monitor, and control. Once installed behind existing switches or connection boxes, the micromodules communicate wirelessly in order to automate multiple functions.

Once connected, the micromodules can instantly control dimming systems, on/off switches, raising/lowering blinds and more. Each micromodule has a colour-coded function indicator for quick programming.

The micromodules have been designed specifically to deliver exceptional wireless reach. This means they can penetrate two concrete slabs, and still transmit up to 30 m indoors, while outdoors their reach can extend up to 100 m in an open area.

With coviva, individual functions can not only be controlled, but also combined, which means that entire scenarios can be created and retrieved upon demand, such as “morning” or “evening”. Called “covigrams”, these scenarios can be created simply in the app by means of an intuitive menu with understandable if-then functions.

 

Cushman & Wakefield Broll provide comprehensive range of occupier services

Broll Property Group, the largest independently owned Pan-African commercial property services company, has entered into an exclusive affiliate arrangement with Cushman & Wakefield, a leading global real estate services company.

The new venture represents a partnership with Broll’s occupier services business and will be branded Cushman & Wakefield Broll, providing clients with an integrated platform covering the entire sub-Saharan Africa region.

The partnership combines Broll’s well-established operations and market-leading track record of occupier services across Africa with Cushman & Wakefield’s global reach. This will allow for the optimisation of Broll’s expansive knowledge of the African markets with the weight and expertise of a global player.

“This partnership provides an important distinction for users of space, who will benefit from the Cushman & Wakefield Broll dedicated focus on occupier clients,” says Ken Gerber, MD of Broll Occupier Services.

The service offering covers end-to-end corporate real estate solutions for businesses across all sectors, including advisory and transactions, workplace consulting, project management, estate management, data management, technology and finance, as well as treasury services.

Malcolm Horne, CEO of Broll Property Group, said: “We are very excited about launching Cushman & Wakefield Broll, which is an affiliation partnership with Broll’s Occupier Services business and will provide our clients with integrated access to a phenomenal global platform.

“Our progressive culture of innovation, service excellence and longstanding client relationships provides a natural synergy with Cushman & Wakefield. Broll’s focus will always be on providing value adding advice that comes from a deep understanding of local markets across Africa, based on our experience in concluding over 6 000 leases in the last 12 months alone, covering in excess of 2,2 million m2.”

Gerber adds, “We are thrilled to announce this venture and look forward to reaping the rewards that both parties will bring.”

Serving seven regional hubs across Africa, the Broll Occupier team comprises of 150 staff members, integrating the local skills and knowledge of on-the-ground professionals with centralised processes, governance and optimised efficiencies.

Cushman & Wakefield has 5 500 people across 133 offices in EMEA. Its strong relationships across the region with affiliates extends delivery of services into markets where the firm does not currently have a wholly-owned presence.

Colin Wilson, CEO, EMEA, Cushman & Wakefield, said: “The sub-Saharan region contains Africa’s two largest economies of Nigeria and South Africa, as well as some of the world’s fastest growing and most dynamic markets. We are excited to enter this exclusive relationship with Broll which enables us to support clients who are already well-established there, as well as provide strategic on-the-ground advice to those looking to grow their presence or enter the region for the first time.”

Founded in 1975, Broll has offices in the major cities of South Africa, the largest African commercial property market; as well as operations in 15 other sub-Saharan African countries including Botswana, Cameroon, Ghana, Ivory Coast, Kenya, Madagascar, Mauritius, Mozambique, Namibia, Nigeria, Réunion, Seychelles, Swaziland, Uganda and Zambia.

In addition to occupier services, Broll’s other services include property management; property broking; valuation and advisory services; shopping centre management; retail leasing and projects; property intel; and property auctioneering.

Investing in REITs without risky direct ownership

When people want to invest in real estate, they usually secure a loan to purchase a property – either residential or commercial. But there are other, more efficient and less costly ways to invest in the property sector.

There are many benefits to direct real estate investment and it is easy to see why buying-to-let is an attractive investment option. However, it is also easy to overlook the considerable costs you can incur, and the drain this type of investment has on your time. Downsides include a lack of diversification, lower liquidity, vacancies leading to loss of rental income, property taxes, insurance and maintenance costs.

This is part of the reason why real estate investment trusts (REITs) have become so popular. REITs offer many of the same benefits of direct property investment, but without the problems.

Marc Edwards, CEO of Tower Property Fund, explains that a REIT is basically a company that owns a portfolio of income producing real-estate that provides investors the chance to own valuable real estate for as little as the price of a share. “Individuals can invest in REITs either by purchasing their shares directly on an open exchange or by investing in a unit trust type of product that specialises in public property. Six monthly dividends will come from the rent collected on these properties, and the value of your REIT shares can increase over time, subject to a stable market as profits grow, so you’ll also own an appreciating asset that grows in value much like a stock.”

Benefits of owning shares in a REIT

“But it is not just about returns,” says Edwards. “The benefits of owning shares in a REIT, compared with direct real estate investing, are plenty. The first is greater diversification: with a REIT, you’re buying a piece of a large real estate portfolio. In comparison, with the price of property and all the other associated costs of buying, diversification of any sort is exceptionally difficult and if you were to buy a property yourself, you’d typically only be able to finance a single property rather than many.

“The second is more liquidity: Since REITs can be bought and sold like a stock, an investor has much more liquidity when compared to investing in a physical property. The third benefit is the fact that you don’t have to invest your time being a landlord: Instead, there is a professional management team that does it for the investors of a REIT.”

The data is clear. REITs have been the best performing asset class in South Africa for the majority of the past 15 years. In the past 18 months returns have reduced due to a number of factors, resulting in a cheaper entry into listed property. Therefore, if you’re thinking about increasing your real estate exposure and want access to a diversified pool of liquid real estate assets that give you six monthly dividends as well as capital growth, then a REIT is probably the right investment for you.

Property investment comparisons at a glance:

Cost

Purchasing property is expensive. Buying property directly will usually mean an investment of well over a R1 million up to several million rands just for one asset. The minimum investment in a SA REIT is one share. Depending on the SA REIT, this could then be below R10.

Finance

When buying-to-let, any borrowing is done in your personal capacity and this introduces the risk of default, being blacklisted and potentially losing more capital than you put in. When buying property stocks, the borrowing is done by the REITs themselves. Therefore, there is no debt in your personal capacity and thus no risk of default.

Increasing interest rates

A rise in interest rates will directly impact your borrowing rate, and as such your monthly re-payments. When investing in REITs, the interest rate needs to be addressed by the REIT and not by you. Many of the REITs are hedging or have already hedged a portion of their interest rate exposure to minimise their risk in an increasing interest rate environment.

Vacancy risk

When you own a property, you face the risk of your tenant leaving, cancelling or not paying. When any of these things occur, you lose rental income and need to spend valuable time and resources finding a new tenant, tenant fit-outs etc.

Of course, REITs also have vacancy risks, and these cannot be avoided, however REITs have professional management companies in place to avoid vacancies, and vacancies are spread over a larger portfolio, reducing your income risk.

Rental income versus REIT distributions

Both rental income and distributions from REITs are not guaranteed. REITs obtain their rentals from a diversified portfolio, reducing the risk of zero distributions.

Diversification benefits

If you buy real-estate yourself you will typically only be able to afford a single property. REITs provide immediate diversification across a number of geographical locations (including offshore) and property types, including industrial, warehousing, offices, shopping centres and many more.

Liquidity

Rental properties are not liquid and it can take months or even years to sell a rental property. REITs are liquid investments that can be easily converted to cash timorously and without paying excessive fees.

 

Emira’s Denver warehousing attracts savvy tenants

Emira Property Fund’s refurbished warehouse facility superbly located in the popular industrial hub of Denver, Johannesburg, has opened its doors, attracting savvy tenants looking for state-of-the-art warehouse facilities, paired with contemporary office space and excellent energy efficiency.

Emira, a leading JSE-listed REIT has invested R8,2 million in the major revamp project, breathing new life into the industrial property which is ideally situated on the corner of Mimetes Road and Kruger Street, offering easy highway access and a convenient location.

“The refurbishment of the Denver warehouse speaks to our commitment to improving the quality of our assets. This property already boasts an excellent location in an established industrial area, with easy highway access, security, and ample electrical power. Following on from the upgrades, we are now able to offer even more value with our modern approach to both their warehousing and business operation needs,” says Ulana van Biljon, COO of Emira Property Fund.

The new facility offers contemporary warehousing of 9 800 m2, in which the new building includes over 1 000 m2 of well-designed, comfortable office space with an eye-catching new entrance. The new courtyard bridges the office and warehouse space, and both have been fitted with the latest in energy-efficient lighting to lower occupancy costs at the facility.

An attractive space to do business, the entire building boasts a striking new façade including unusual linear feature lighting, creating a new landmark for the Denver area.

The upgraded warehouse property also offers water-wise, landscaped gardens, and a new gatehouse positioned at a reconfigured entrance point with electric gates, supporting both security and ease of access. New parking canopies have been installed to cover 100 of the 114 parking bays, and new fencing surrounds the entire perimeter.

“What makes this upgraded industrial facility even more attractive are the affordable rental costs and generous tenant allowances. We have identified a need for affordable, modern and convenient warehousing space and the Denver property addresses this perfectly. It goes beyond being just another industrial property in terms of appearance, as well as the latest in warehousing tech. All of this amounting to hard-to-beat value for money, which is in step with business needs in today’s economy,” van Biljon concludes.

Emira is a medium-cap diversified REIT that is invested in a quality, balanced portfolio of office, retail, industrial and residential properties. At 31 December 2018, its directly held assets comprised 104 properties valued at R12,5 billion. It invests indirectly in 22 shopping centres valued at R1,04 billion through its exposure to Enyuka Property Fund. It also has a 34,9% holding in JSE AltX-listed Transcend Residential Property Fund.

Emira is internationally diversified through its investment in ASX-listed Growthpoint Properties Australia (GOZ) valued at R941 million, and its equity investments in eight grocery-anchored open-air convenience shopping centres with a combined value of USD61 million through its USA subsidiary.