13 minute read
FINANCE
GRADE A OFFICE SPACE, GHANA: Absa Commercial Property Finance was involved in financing PwC Tower in Accra, Ghana. The 10-floor development boasts highend interior finishes, modern architectural design, and state-of-the-art systems and technology. Anchor tenant PwC will occupy six floors, while the remaining space is a multi-let to diverse businesses.
have done well, especially in well situated areas.” Padayachee suggests a demand for small and medium industrial units in the short term: “As businesses improve efficiencies in staffing and operations, they could downsize space required.”
Opportunities in He cautions that some larger warehouse spaces may find things more difficult until the market improves. sub-Saharan Taking a longer view on commercial space The outlook for commercial space is worrying, given lost revenue and rising unemployment. Commercial turnovers remain constrained. Liquidity is a Africa Sub-Saharan Africa remains a worthwhile investment proposition. By SAMANTHA BARNES problem. “They will stabilise,” Padayachee predicts. “Markets always recover and the commercial property industry will be no exception, making it a worthwhile investment in the long-term as the economy recovers.” While economic recovery is unlikely in coming months, Padayachee expects that
With a footprint in sub-Saharan systems provide both a challenge and an over the coming years, property returns Africa, including South Africa, opportunity for developers and financiers,” should, subject to interest rates, improve Botswana, Namibia, Ghana, says Joshua. “Demand for affordable to at least pre-lockdown levels, albeit Kenya, Mozambique, Tanzania, housing extends to student housing.” off the current low valuation base. “The Uganda, Zambia, Mauritius and Absa CPF anticipates that logistics and need for commercial space will escalate the Seychelles, the challenge for the Absa warehousing will present opportunities, for businesses across various sectors, Group is understanding local operations. given the drive to expand distribution ensuring improved returns as the economy “We have a unique advantage,” says warehousing in African corridors. “This recovers,” says Padayachee. Working from Somaya Joshua, head of Africa regional may create opportunities for developers,” home has increased demand for dataoperations at Absa CPF. “With a banking observes Joshua. centred rental space. presence in the countries where we Business Partners Limited expects Business Partners confirms significant actively provide increased demand for warehousing. Shane commercial developments in sub-Saharan debt, we have an Padayachee, area manager at Business Africa. Ukam Properties spearheaded a on-the-ground Partners Limited, one of Africa’s leading 1 200m 2 retail development in Kigali City. understanding of financiers for formal small and medium Studio 45 invested in a six-floor, mixedthose markets.” owner-managed businesses, explains: use, office and residential development in COVID-19 has “Warehousing and storage seems to Kamwokya, Kampala. Progress. impacted new development activity, which is limited. On the IS OFFSHORE PROPERTY INVESTMENT AN ASSET CLASS? Somaya Joshua other hand, new development “varies When investing in offshore property, global real estate investment should definitely be recognised as a distinct asset class on the from country to same level as other asset classes. It is a diversifying, value-adding, country”. Generally, safe and appreciating addition to one’s portfolio. In fact, with all “Clients have revised new investment the many prevailing local and global uncertainties, diversifying into decisions down given the uncertain international property in stable and secure jurisdictions can serve environment,” reflects Joshua. as an excellent hedge against risks, says Craig Featherby, CEO and Founder of Carrick.
IMAGES: SUPPLIED affordable housing and warehousing Predictably, with burgeoning population growth, there is pent-up demand for affordable housing. “In many markets, underdeveloped housing finance “It is for this very reason that Carrick, together with our international partners, is now assisting its clients who wish to diversify into offshore property with a comprehensive range of services,” says Featherby. Craig Featherby
ON DISTANT SHORES
Recently launched offshore real estate division Carrick Property has been making swift headway on distant, low-interest shores
Craig Featherby, founder and CEO of the Carrick group, was originally not a property man. “Throughout my career, I’ve been advising clients about shares and unit trusts as part of traditional fi nancial planning,” says Featherby. “I’d been approached by countless international developers to get involved in property, but because it wasn’t my speciality I was reluctant to get my feet wet.”
Midway through last year, Featherby and co predicted that the 12-year bull run on the international stock markets was bound to end, and realised they needed an alternative investment strategy. After fi nally becoming convinced to give property a try, Carrick Wealth created a proof of concept in its Harare offi ce. “I believed that if it was successful in Zimbabwe, it would be successful anywhere else within the group,” says Featherby.
The company facilitated 41 transactions in 90 days. That was proof enough.
BRICKS AND MORTAR
Due to the high performance of the stock market, Carrick Wealth found that many of its clients were sitting on large amounts of cash. Coupled with the low-interest-rate environment, this meant getting into offshore property investment made sense.
It also made sense for South Africans It also made sense for South Africans because, as group sales director, Bradd because, as group sales director, Bradd Bendall, points out, we are bricksBendall, points out, we are bricksand-mortar kind of people. and-mortar kind of people. “However, given the political “However, given the political situation in this country, situation in this country, it’s prudent for South it’s prudent for South Africans to hedge their Africans to hedge their bets and invest overseas, bets and invest overseas, externalising their wealth to externalising their wealth to secure their retirements.” secure their retirements.” In consultation with clients, In consultation with clients, they developed a product they developed a product offering with an entry-point offering with an entry-point level of around £95 000. level of around £95 000.
Craig Featherby, Founder and CEO, Carrick Group of Companies
Key to its appeal is that Carrick Property will be living there by the end of the year. facilitates a cradle-to-grave service, sourcing This will place massive strain on key housing appropriate solicitors, markets.” It also presents a furnishing and tenants, friendly fi nancing environment. and even collecting rental “Institutions there are mostly through a group of carefully investment funds, which are selected partners. A robust more interested in the property process of due diligence than the borrower. We just had ensures these partnerships a client enter into a 15-year work for everyone involved. fi nance arrangement with a fund
Currently they deal at 1.8 per cent. When you’re with four different service Bradd Bendall, borrowing at that rate and your providers: IP Global; Seven Group Sales Director, Carrick Wealth rental market is 4–5 per cent, Capital; Global Residential; that makes a lot of sense.” and Residential Property balance sheet to complete the development,
LOCATION, LOCATION, LOCATION
Birmingham, Liverpool, Manchester and Leeds are all undergoing regeneration projects. Homes will need to be built.”
Germany also represents a buoyant property market with stable rental and low unemployment. “It’s the largest economy in Europe,” says Featherby. “An estimated 83.5 million people Advisory Group. THE RETURN Friendly lending environments make for friendly “GIVEN THE POLITICAL SITUATION IN returns, says Featherby. “When you can borrow money at 2 per cent, with rental yields THIS COUNTRY, IT’S PRUDENT FOR across the UK anywhere from 6–8 per cent, SOUTH AFRICANS TO HEDGE THEIR BETS AND INVEST OVERSEAS, EXTERNALISING capital appreciation including leverage comes in at about 15 per cent, and 4–5 per cent yields on an annual basis less your fi nance THEIR WEALTH TO SECURE THEIR costs, clients are very happy indeed.” RETIREMENTS.” – BRADD BENDALL For the Carrick group, this all forms part of a holistic approach to securing clients’ fi nancial
“We look at track records with a big focus with us through other investment vehicles,” on the balance sheet,” says Featherby. concludes Bendall, “so we need to safeguard “Developers need to have a strong enough their entire portfolios.” as well as access to external fi nancing. Deposit This article is an opinion piece only and should not guarantees are also essential. We want to be construed as investment advice. For investment ensure a low-risk investment for our clients.” advice you should always consult a professional wealth specialist.
Of course, choosing the right location is as important as choosing the right partners. For more information: +27 (0) 21 201 1000 Therefore, Carrick Property takes a macro Carrick House, The Forum, view of its prospective markets. “In the UK North Bank Lane, Century City, 7441 currently, there’s a 47 per cent undersupply info@carrick-property.com of homes,” says Featherby. “Markets like www.carrick-property.com
futures. “Most of our clients have invested
Investing in medical real estate
Healthcare-focused property companies are performing well despite the current global economic climate, reports SAMANTHA BARNES
Healthcare property development is a high barrier to entry proposition, as befits the market that the sector serves, which includes acute and sub-acute hospitals. So what is critically important when serving this market?
“Very important is obtaining the trust and buy-in of medical specialists,” says Michiel Scharrighuisen, director at Giflo. “The other element is to engage, listen and understand the doctors needs and provide workable solutions. The most important factor is a fair and sustainable rental proposal.”
In 2018, Growthpoint Properties launched Growthpoint Healthcare Property Holdings and announced a R2.4-billion portfolio. Dr Linda Sigaba, fund manager of Growthpoint Healthcare Property Holdings attributes their success to collaboration and strong working relationships. “These specialist developments are tailor made,” says Dr Sigaba. “They require turnkey solutions to enable their effective and efficient functioning and an excellent experience. The entire process is undertaken in close consultation with operators, doctors, and other stakeholders.”
COVID-19 has drawn attention to shortcomings in the provision of healthcare. “The pandemic has highlighted critical gaps in South Africa’s healthcare sector,” says Dr Sigaba. “We believe that we could play a role in closing them. For instance, the need for private sector hospital beds in traditionally underserviced areas like townships, and the smaller provinces.”
Giflo has not changed their approach during the pandemic. “We remain as committed to our existing projects and positive about our future projects as we were before,” says Scharrighuisen.
Who is playing within this space
The Growthpoint Healthcare Fund is the first unlisted healthcare fund to invest exclusively in healthcare property assets in South Africa. The investment mandate is to acquire and develop acute, day and specialist hospitals as well as laboratory and pharmaceuticals manufacturing and warehousing facilities.
The specialised surgical hospital development by Growthpoint and Cintocare became the first healthcare property on the African continent to be awarded a Green Star Rating, receiving 5 Green Star Custom Healthcare design certification from the Green Building Council South Africa (GBCSA).
“We will be proud to take ownership of this clinical centre of excellence on completion,” says Dr Sigaba. “Growthpoint also completed the 52-bed expansion of Busamed Hillcrest Private Hospital in January, which added much needed surgical and medical capacity to the busy healthcare facility.”
Lockdown delayed construction of the Cintocare Pretoria Head and Neck Hospital. Opening has been rescheduled for January 2021.
Giflo is especially proud of their pilot purchase, Cormed Hospital which they expanded and renovated. “The significance was a solution-based approach to engage collectively and individually with various shareholders,” says Scharrighuisen, “earning their vote of confidence to participate in a facility they have been creating for 30 years and trusting our involvement therein.”
GVK-SIYA ZAMA was involved in the refurbishment and expansion of the clinical Neuroscience Institute at the UCT Groote Schuur Medical Campus.
WHY HEALTHCARE SPECIALISTS ARE KEY PARTNERS
“From a contractor’s point of view, ensure that consultants are healthcare specialists; including the architect, mechanical, electrical and plumbing consultants and other specialist services,” advises Eben Meyburgh, CEO of GVK-Siya Zama.
GVK-Siya Zama’s expertise includes the entire spectrum of healthcare services, from highly sophisticated private hospitals with specialist facilities such as oncology bunkers, to large government hospitals, day clinics, community health centres and rural clinics.
COVID-19 presented the opportunity for the company to deliver fast-track projects. “Many healthcare facilities were required to prepare for the onslaught of the pandemic,” explains Meyburgh. Teams embraced alternative building technologies (ABT) such as pre-manufactured lightweight steel structures to deliver projects.
GVK-Siya Zama entered into partnerships with consultants to deliver turnkey projects in record time. “Such consortiums are proven to be more productive, being more symbiotic and solutions focused,” says Meyburgh. The innovation and commitment of these medical real estate companies is commendable.
GVK-Siya Zama Construction has a proud South African history, tracing its roots to 1960. The construction giant is a Level One Broad-based Black Economic Empowered (B-BBEE) contributor and 51 per cent blackowned. It is one of a select group of privately owned construction companies, graded at Construction Industry Development Board (CIDB) Level 9 GB:PE (General Building Potentially Emerging) and 8 CE: PE (Civil Engineering, Potentially Emerging). “We differentiate ourselves by the collaborative relationship we develop with clients, industry associates and employees; working with integrity, being fair and getting the job done,” says Eben Meyburgh, CEO of GVK-Siya Zama. “Our depth of knowledge and experience working with and meeting the expectations of a variety of clients affords us the advantage of advising clients and fi nding solutions to problems.”
With an extensive client list in the private and public sectors, GVK-Siya Zama has the expertise to deliver projects in many sectors including education, healthcare, judicial, commercial (industrial, business and retail), hospitality and residential, mining, industrial, municipal and government infrastructure and service projects.
Maintaining international operating standards is a top priority for the group. “Our ISO 14001 certifi cation in 2013 is testament to our commitment to environmentallysound practices,” says Meyburgh. Further international certifi cations include ISO 9001:2015 (quality management) and OHSAS 45001 (health and safety).
Civils infrastructure expertise includes building water and wastewater treatment plants, reservoirs, process plants, mining infrastructure, water and sewerage infrastructure and specialist civils’ structures such as railway over- and under-passes.
GVK-Siya Zama has offi ces in Cape Town, Port Elizabeth, Durban and Johannesburg.
For more information: www. siyazama.co.za
Building
Eastern Cape | Hannes Geyser (041) 365 1557
Gauteng | Pherdy le Roux (011) 608 0313
KwaZulu-Natal | Justin Meder (031) 314 3700
Western Cape | Chris Maughan (021) 461 6665
COLLABORATION IS THE NAME OF GAME
Construction giant GVK-Siya Zama Construction believes in working together with stakeholders to deliver on projects
PROJECTS
Some of GVK-Siya Zama’s current and recent projects include:
Civils
• Isipingo Retail Development, Isipingo • Saveways Mall, Witbank • Corobrik, Driefontein • Limpopo High Court Parkade, Polokwane • Sipetu District Hospital, Ntabankulu • Thulamahashe Plaza, Thulamahashe • Forest Hill Military Base, Port Elizabeth • Dinosaur Interpretative Centre, Clarens • Ernie Els Winery, Stellenbosch • Port Nolloth CHC, Port Nolloth • Royal Buffalo Specialist Hospital,
East London • Saldanha Bay IDZ Gatehouse
Commercial
• The Ridge, V & A Waterfront, Cape Town • Plein Park, Cape Town CBD • Talksure House, Umhlanga Ridge, Durban • Engen, Cape Town CBD • Waterfall Corporate Campus, Phase 3
Building 5, Waterfall, Midrand • Global Call Centres, Two Locations,
Cape Town
Healthcare
• Sipetu District Hospital, Ntabankulu • Royal Buffalo Specialist Hospital,
East London • Lenmed Royal Hospital and Heart
Centre, Kimberly • Melomed Private Hospital, Richards Bay • Eden Gardens Private Hospital,
Pietermaritzburg • Netcare St Augustine’s Hospital,
Berea, Durban • Vredenburg Hospital, Vredenburg • Cato Ridge Private Hospital,
Sherwood, Durban • Lusikisiki Clinic, Lusikisiki
Retail
• Saveways Mall, Witbank • Isipingo Retail Development, Isipingo • Thulamahashe Plaza, Thulamahashe • Walmer Park Shopping Centre, Walmer,
Port Elizabeth • Stadium on Main, Claremont,
Cape Town • 4th Avenue Pick n Pay, Newton Park,
Port Elizabeth
Residential
• Old Cape Quarter, De Waterkant,
Cape Town • The Anson, Observatory, Cape Town • Eaton Square, Diep River, Cape Town
Civils
Anton Botha (011) 608 0313
Business Development
Western Cape Graham Brookman 083 644 8840 Gauteng Ndzulu Twantwa 072 700 0814 Paul Baggott 083 200 6793
