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M A K I N G A DIFFERENCE Years of experience of South Africa’s housing market led to the foundation of MSP Group, which brings a different approach to its business. Ruari McCallion listened to Claudius Combrinck explain.
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MSP Group FEATURE
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or MSP Group, the opportunities of the new South Africa are also a challenge. It wants success for itself, of course, but it sees its road to reaching that goal as paved with more than just good intentions. “We want to create opportunities and build new realities,” said Claudius
Combrinck, group marketing director of MSP Developments, one of the business units within MSP Group. “We are already in the leading group of property developers in the Western Cape; we want to become the preferred property developer in our chosen markets, which are currently in the Western Cape and the Gauteng region.” MSP was established less than a decade ago, in 2002, by Riaan Roos, the company’s CEO. In 2006, it was recognised by the NHBRC as ‘Western Cape Builder of the Year’ in its segment; two years later it won a Govan Mbeki Housing Award nomination. To coin a phrase, to win one award may be fortunate; to win two, so close together and so soon after foundation, sounds like planning. “Our CEO started his own business in 1992 and became a partner in RBA Developments in Johannesburg in 1994,” said Combrinck. “In 1999 he moved with RBA to Cape Town and saw what he felt was an opportunity there. He sold his shares in RBA and opened MSP.” The opportunity he saw was focused on the area of greatest need. “We are now the largest affordable home builders in Western Cape by far, with 743 opportunities currently in development,” he continued. “We’re building quality
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homes but smaller – up to the middle segment, in the price range of ZAR249,000 – 1,500,000.” MSP’s portfolio includes rental homes, in partnership with external organisations. It is also active in rent-to-own/ shared equity housing. Within the Group are I-Mortgage and Uvest, which deal with purchase finance, and sales and letting, respectively. MSP is structured as an end-toend developer, dealing with everything from land acquisition to final purchase or let. “We’re striving to make home ownership more affordable and easier,” said Combrinck. “We work closely with banks, who support home purchase with up to 110 per cent mortgages in the affordable sector. That part of the market hasn’t been affected by the financial crisis.” MSP is clearly focused
We want to create opportunities and build new realities on South Africa’s shortage of housing in the affordable sector and on supplying the need with quality products. “We’re bigger, which means we have more bargaining power. We work closely with the banks to ensure that what we offer for sale is well built, quality stock, on estates and with security – it’s a massive improvement on what has been available. We’re uplifting and changing communities.” A typical example is to be found at the Belladonna Estate, Blue Downs. It consists of 480 single residential units, 262 apartments and 6,300 square metres of commercial development. Its start date was the beginning of March 2010, with scheduled final completion in July 2013. “Our developments represent a huge uplift – they’re changing the nature of the communities. People in lower-income areas 4
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are able to move from shacks and informal housing into something that greatly improves their lives,” he said. “We do work in the middle sector but there is a ‘feelgood factor’ in the affordable end.” Banks are also mandated to become involved in the affordable end. “Tackling the housing problem is tough and some other builders have erected housing that’s not really that great. We pride ourselves on quality and accessibility.” MSP consists of a number of sub-divisions and companies that complement the process. It employs its own sales team, mortgage
MSP Group FEATURE
team, development team, after-sales support, security, administration support, building supplies, kitchen and cupboard manufacturer and the construction company. It uses its size to leverage for the best deals on materials – when it buys, it buys in bulk.
We’re striving to make home ownership more affordable and easier “Our own sales team sells the bulk of our housing stock and that cuts out expensive commissions,” he continued. Many construction companies focus on their core area but MSP prefers to control the process as much as possible. “It keeps everything cost-effective. We believe that the only way to be really cost-effective is to bring everything in-house. We engage every one of our companies to a get to a price point – we have to be price sensitive, while remaining focused on quality. We believe we’re the only entity that has so much under one roof.” Most of the expertise was acquired as the company grew, by purchasing equity stakes in existing businesses. It deploys careful management, with a strong management team and financial department. Subsidiary companies are run by development managers or MDs, who have been brought through internally. “We have three trainers who deal with core skills development,” said Combrinck. “We have introduced Dale Carnegie training, which we started with the management group. We have just had a complete audit with 22 of our managers and business heads over a weekend session. the next step is Carnegie training and motivational support.“ The sales team is being trained in selling off-plan, with detailed and targeted follow-up. For the company’s Blue Downs project, MSP will be working to
empower the local community in development of skills and increased employment. And not just in the short term, while the project is under construction. “We will be engaging the community with security,” he said. “There will be a homeowners’ association; the development will contribute to the emergence of upkeep services, including house and estate maintenance. It will be an opportunity for local people to start their own businesses. The labour force we need will continue working with our construction team. We have been involved with feeding programmes in very poor communities – now we’re engaging with local schools in renovation, improvement and support. We believe the way forward is to step beyond simply writing big cheques, it’s about getting involved, getting hands-on, not just building and moving on. We believe in making a long-term difference.”
What sets EKCON apart? EKCON is often described as a boutique Consulting Engineering company, i.e. an exclusive practice offering specialised and customised engineering services. The owners are highly skilled and experienced engineers, and remain actively involved throughout all phases of a project. For our clients this ensures: • value engineering at conceptual stages • expert evaluation of design alternatives • accurate budgeting and costings • full synergy between concept and detailed design • continuity in communication and problem resolution • active role of designer in project supervision • mutual trust EKCON (Pty) Ltd Trading as EKCON Engineers & Project Managers Address Uitzicht, Tygerberg Park 163 Hendrik Verwoerd Drive Plattekloof 7500 Tel: +27 21 930 9360 Fax: +27 21 930 9364 E-mail: ekcon@ekcon.co.za
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