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PRETORIA, GP, South Africa
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30 September 2014

Attacq, still on the prowl for development opportunities

Attacq, still on the prowl for development opportunities

Still bullish in the local and international market.

A strong development pipeline and diversification strategy in Africa and international markets buoyed Attacq to report an increase in its net asset value per share of 24% to R14.77 for the year ended June 2013.

Attacq, with a market capitalisation of over R14 billion, secured full ownership of its local retail assets during the financial period under review. This includes super regional centres of MooiRivier Mall, the Eikestad Mall Precinct, Brooklyn Mall and Garden Route Mall.

Legality of CTICC construction scrutinised

Oh Wow ......... I absolutely LOVE a good discussion on Servitudes!

Gareth Shepperson
Commercial and Property Attorney

Legality of CTICC construction scrutinised

Although construction on the R832 million expansion of the Cape Town International Convention Centre (CTICC) is well under way, defective advertising of the proposed expropriation of public servitudes has put the legality of its building processes under scrutiny.

Objectors are calling for a halt to construction work on the CTICC until all legal obstacles are removed and a public participation process is finalised.
It is understood that objectors are concerned that building activity has continued, despite the existing planning restrictions, and there has been a call for all building work to stop to remove legal obstacles and finalise public participation processes.

The ACDP has asked why the city's plans to take away the public access use of the land in Roggebaai to allow for the expansion of the CTICC were so poorly advertised.

Court grants Pick n Pay exclusive property lease

Court grants Pick n Pay exclusive property lease

Massstores has been interdicted by the high court from interfering with the contractual relationship between Pick n Pay and listed property fund Hyprop by operating a general food supermarket at the CapeGate Shopping Centre in Brackenfell in Cape Town.

In a judgment handed down in the Gauteng Provincial Division of the High Court sitting in Pretoria on Friday, Judge Johan Louw said Pick n Pay had succeeded in proving that it was entitled to a final interdict against Masstores, a division of listed retailer Massmart.

Judge Louw agreed with a submission by David Unterhalter, counsel for Pick n Pay, that a clause in Pick n Pay's lease operated to prevent Masstores from combining its existing Game general merchandise business with the business of a general food supermarket that sold both perishable and nonperishable foods.

'Check property documents carefully before signing'

IT IS ALWAYS A SOURCE OF THE UTMOST ASTONISHMENT that when people enter into the single biggest transaction of their lives (the purchase of their home) that they fail to seek out independent specialist legal advice!

It is the custom in SA that the Seller appoints the transferring attorney and the Buyer pays the transfer costs. Although the transferring attorney (conveyancer) represents all parties in giving effect to the Deed of Sale, it is not his/her duty to advise the Buyer prior to signing the Deed of Sale.  It is therefore incumbent upon the Buyer to seek independent specialist legal advice PRIOR TO signing.  In my experience, that virtually never happens.

Gareth Shepperson
Commercial and Property Attorney

'Check property documents carefully before signing'

Many property buyers want to act quickly when purchasing a home and might sign purchase documentation without having read it carefully.

They must, however, think things through carefully, take time to read the documentation and sign later, says Annette Evans, regional general manager of the Institute of Estate Agents, Western Cape.

Evans says that queries have come in from members of the public with regard to their contracts, where things such as the suspensive conditions should have been clarified in the offer to purchase and weren't. In one particular case, the property that the buyer was meant to sell, which was listed as a suspensive condition was not mentioned in the offer to purchase.

29 September 2014

Mellville shipping container shopping centre gets go-ahead

Mellville shipping container shopping centre gets go-ahead

The new container shopping centre in Melville is set to become a reality after the city approved the site development plan.

What was Faan Smit Park is to become 27boxes, a design and retail centre in the middle of Melville.
The development, in the Faan Smit Park west of 7th Street, will become South Africa's first shopping centre made of shipping containers.

The park will be known as 27boxes. Its design is planned to reflect the vibrant, trendy and somewhat bohemian character that made Melville famous, transforming it into a shopping centre and parkland.

The development will provide 200 parking bays.

Residential market on the mend

Residential market on the mend

Estate agencies report robust show days and short duration of properties on sale.

Shorter duration of properties being on sale, robust show-day attendance and stock shortages fuelling a surge in residential property prices: could this spell a recovery for the residential market?

The market is in a significantly better mood since the wrath of the global financial crisis in 2007 – where demand slowed and house price growth depressed.

But the turbulent tide seems to have turned for the better and the market seems to be picking up.

“In 2014 the market is significantly better. We call this a balanced market, there are a good number of buyers and sellers,” says Seeff chairman Samuel Seeff.

25 September 2014

At expiry, a property lease changes

At expiry, a property lease changes

When a tenant continues to occupy the dwelling after the fixed period lease ends, the occupation becomes a monthly periodic lease.

Section 5 of the Rental Housing Act 50 of 1999 relates to the provisions of leases and subsection 5 deals with an expired lease.

According to this paragraph, if the tenant remains in the dwelling, with the express or tacit consent of the landlord, a periodic lease is created.

In the absence of a further written lease, parties are bound by the same terms and conditions of the expired lease, except that at least one month's written notice must be given of the intention to terminate the lease.

22 September 2014

Pickvest directors acted dishonestly – FSB

Pickvest directors acted dishonestly – FSB

Appeal dismissal raises serious questions.

Directors of property syndication promoter Pickvest have launched an application in the Pretoria High Court to have an incriminating determination by the Financial Services Board (FSB) reviewed and set aside.

The decision, which was made in February by the FSB’s Appeal Board, found that Pickvest’s directors acted dishonestly and without the care, skill and diligence expected of financial services providers (FSP) under the Financial Advisory and Intermediary Services (FAIS) Act.

This formed the basis of the Appeal Board’s dismissal of Pickvest’s appeal against an April 2013 decision by the board’s Registrar of Financial Services Providers to have its FSP licence withdrawn.

19 September 2014

Municipal approvals delay property development

Municipal approvals delay property development

Some projects just no longer viable: some approvals take up to three years.

Huge contributions to bulk services and delays in municipal approvals seriously hamper commercial property development in South Africa, says Harry Gey van Pittius, chairperson of the South African Affordable Residential Developers Association (Saarda).

The association hopes to discuss the issue in the near future with Lindiwe Sisulu, Minister of Housing, but her mandate does not include local government, which makes it difficult for her to intervene, Gey van Pittius said.

Municipalities don’t have the necessary skills, especially engineers and building inspectors and decision-making has been centralised at political level, he says.

Sharemax complaints surge after Bam determination

Sharemax complaints surge after Bam determination

Sars applies for liquidation of Sharemax and termination of the business rescue process.

The South African Revenue Service (Sars) has applied for the liquidation of Sharemax Investments and for the business rescue proceedings of the company to be terminated.
This follows a lengthy tug of war since 2012 between Sars and the directors of Sharemax and the Nova Group of Companies for the payment of R15.7 million of outstanding taxes.
Sars filed the application in June 2014, as it does not foresee the company being able to pay the debt.
Sars names, amongst others, business practitioner Dawie van der Merwe, former Sharemax directors Willie Botha, André Brand, Dominique Haese, as well as Nova Property Group chairman Connie Myburgh as respondents.
In a strongly worded affidavit Elle-Sarah Rossato contends on behalf of Sars that that the sole reason for placing Sharemax Investments into business rescue was to abuse the mechanism prescribed by the Company’s Act not to pay creditors.
“The inescapable inference is that creditors of Sharemax Investments were misled with a promise that R40 million would be coming their way, whilst the controllers of the first respondent had already decided to abuse the Company’s Act business rescue provisions.”
The R40 million refers to the amount earmarked to be paid to Sharemax Investments shortly after the restructuring investments, and was to be used to pay creditors.

18 September 2014

Durban beachfront's largest property development takes shape

Durban beachfront's largest property development takes shape

A R1.8 billion expansion of Durban's landmark Suncoast Casino has been given the nod, clearing the way for a doubling of the existing complex.

An artist's impression of the beachfront facades.
The project by Tsogo Sun will be the biggest single investment in the history of the beachfront and will take three years to complete.

All the necessary regulatory approvals are in place, now allowing detailed planning.

This follows the company's R220 million upgrade of the relaunched Southern Sun Elangeni and Maharani Hotels into one complex last year, with another R100m face-lift under way at the hospitality group's 33-year-old Marine Parade Garden Court.

The Suncoast expansion plan had to get the nod for an amendment to the casino licence conditions from the KZN Gaming and Betting Board - and the provincial government - as well as an amendment to the Integrated Development Plan for the precinct from the eThekwini Municipality

In terms of the application approved by the gaming board, Tsogo Sun will make R100m available to be spent on charitable or social infrastructural developments in the province.

A bird's eye view of the proposed project.
The attraction, which opened its doors almost 12 years ago, has 8million visitors a year and the expansion became necessary, as 'we have been at capacity for some time', said Mike Dowsley, the executive director of Suncoast Casino, Hotels and Entertainment, as it is now called.

Optimism rises with house building activity

Optimism rises with house building activity

A sharp rise in residential building activity has resulted in improved confidence in the industry in the third quarter.

The FNB/Bureau for Economic Research (BER) building confidence index released yesterday revealed that confidence in the industry had improved to 45 index points on a 100-point scale in the third quarter.

The index slumped 11 points to 41 in the second quarter after breaching the key 50-point mark in the first quarter.

John Loos, a property economist at FNB, said yesterday that although the index remained below the key 50 mark, it did suggest that conditions in the building sector had improved.

17 September 2014

Cape Town's waterfront celebrates 25 years

Cape Town's waterfront celebrates 25 years

Southern Africa's biggest tourist attraction - the V&A Waterfront - was three decades ago a 'far sighted' idea but as it celebrates its 25th anniversary, it has become a massive source of income and pleasure.

The V&A Waterfront viewed from the Cape Town Observation Wheel.

'The V&A Waterfront is a special place, where a centuries-old working harbour remains at the heart of a modern, cosmopolitan urban precinct. Built on layers of history and generations of Capetonians who have jealously treasured their links with the city's maritime heritage, the Waterfront has assumed a special place and significance in the hearts of our community,' V&A chief executive David Green said in the foreword a book entitled V&A Waterfront 25th Anniversary which is to be launched on Wednesday.

'What rental increase is fair?'

'What rental increase is fair?'

Many landlords want to know by what amounts and when they could increase the rentals on their properties.

These property owners would possibly prefer to automatically increase this each year (many use a standard rate of 10%) but the yearly increment does depend on various factors, and landlords need to understand what these are because not all increases can be passed on to the tenant, says Michael Bauer, managing director of IHPC estate agency.

Revamped Pretoria Church Square revealed

Revamped Pretoria Church Square revealed

Artists' impressions of the new-look Pretoria Church Square were revealed during a community liaison forum meeting yesterday.

Major roadworks and developments are under way on and around Church Square.
In future the square will boast more trees and pedestrian areas. There will also be new street furniture and the south wall's fountains will be restored to a working condition. The meeting was to update the public on the progress of the city's first bus rapid transit project.

16 September 2014

Listed property still offers opportunities

Listed property still offers opportunities

Despite higher bond yields and interest rates.

Over the past decade, the local listed property sector has experienced stellar average compounded growth in excess of 20%, but does the sector still have attractive longer-term return prospects in the face of higher bond yields and interest rates?

Ian Anderson, chief investment officer at Grindrod Asset Management, says the biggest driver of the excellent historic performance was the declining interest rate and yield environment.

“This meant investors were prepared to accept lower yields (i.e. pay higher prices) for their listed property investments,” Anderson says.

A secondary driver was the moderate increase in distribution growth the sector was able to produce, despite the weaker economic backdrop.

However, the sector’s performance during 2013 and in the early part of this year has been more subdued.

The table below highlights the total return of the listed property sector (Sapy index) over the last decade.

PeriodSapy total return
2014 YTD14.0%*
* As at September 9 2014

15 September 2014

South Africa`s strong case for green retrofitting

South Africa`s strong case for green retrofitting

Despite South Africa being the fastest growing green building market in the world, most buildings in the office sector do not comply with environmental sustainability standards. But there is a strong case for green retrofitting. 

While South Africa is only playing catch-up to its developed and developing counters, United States-based McGraw-Hill Construction in its World Green Building Trends survey notes that 58% of South African firms surveyed reported future green commercial retrofits by 2015.

Furthermore the survey, which tracks 62 countries pegs the country's take up of green building to grow three-fold, from a measured 16% in 2012 to 52% by 2015.

These figures put South Africa ahead of the pack for its fast adoption of green building - trumping Australia, United Arab Emirates, Singapore and Brazil - despite its foray into green building seven years ago. 

Pickvest: too late to lay a complaint with FAIS Ombud?

Pickvest : too late to lay a complaint with FAIS Ombud?

It may be too late for investors who bought property syndications from Pickvest (formerly PIC Syndications) to lay complaints with the FAIS Ombud.

PIC Syndications, now Pickvest, promoted property syndications worth approximately R5.3 billion. All outstanding syndications, worth R4.6 billion, are in business rescue and investors are once again complaining of late interest payments. In April 2013, Pickvest’s licence to render financial services was withdrawn by the Registrar of Financial Services Providers. Pickvest, which boasts around 18 000 investors (many of whom are pensioners) appealed the decision and this appeal was dismissed by the Registrar in February 2014.

Aussie more attractive for Growthpoint than SA

Aussie more attractive for Growthpoint than SA

The turbulent domestic market has prompted South African companies to look beyond the market for value in their investments.

The property sector has also joined the search for more offshore investments which provide greater diversification, exposure to a larger market and attractive valuations.

This trend is echoed more by South Africa’s largest listed JSE-listed property company, Growthpoint Properties which is finding the Australian market more appetising.

Growthpoint, best known for its portfolio of quality assets which include Cape Town’s V&A Waterfront, is seeing limited assets in the local market.

'Legislation to limit foreign ownership of land is a blunt instrument'

'Legislation to limit foreign ownership of land is a blunt instrument'

There's no doubt that the timing of the announcement about the government's plans to limit foreign property ownership is bad, and has done nothing to improve investor sentiment or business confidence, says a property executive.

'What is worse, though, is that Rural Development and Land Reform Minister Gugile Nkwinti has never really explained the thinking behind the proposed new land legislation in public, even though it has been on the cards since at least 2011, so we don't actually know whether the reaction it has engendered is too harsh - or perhaps not harsh enough,' says Berry Everitt, managing director of the Chas Everitt International property group.

12 September 2014

Prescribed rate of interest on overdue levies drops to 9 percent

This has not been too widely publicised but it is quite a significant drop (i.e. from 15.5% to 9%)!

Gareth Shepperson
Commercial and Property Attorney

Prescribed rate of interest on overdue levies drops to 9 percent

As of the beginning of August, the prescribed rate of interest charged on overdue levies in sectional title schemes has been reduced from 15,5% to 9% per annum.

While Prescribed Management Rule 31 (6) allows trustees to charge interest on arrear levy amounts, the amount is not stipulated so the rate of interest is calculated according to the Prescribed Rate of Interest Act, whereby section 1 (2) dictates what interest rate is charged on overdue amounts (which has now been reset by the Minister of Justice to 9%), says Michael Bauer, general manager of the property management company IHFM.

SA's largest green building gets 6-star rating

SA's largest green building gets 6-star rating

Cape Town has made green building history with the announcement by the Green Building Council of South Africa that No 1 Silo at the V&A Waterfront has been given the country's first 6-star Green Star SA 'As Built' rating.

The No1 Silo office building at the V&A Waterfront.
The announcement was made at FNB's Portside building during the Green Star Leadership Awards 2014, which form part of the Green Building Convention in Cape Town this week.

Ten new hotels planned for Cape Town

Ten new hotels planned for Cape Town

Property investors could build 10 more medium-range hotels in Cape Town to meet the growing demand for holiday accommodation, research findings suggest.

Figures for the first seven months of this year show that Cape Town's 87 hotels had an average occupancy rate of 66.6 percent - better than the national average of 60.5 percent.

Joop Demes, chief executive of Pam Golding Hospitality, said the demand for hotel rooms in Cape Town was steadily increasing, yet few new rooms or hotels had been created since 2010.

More than 1 500 hotel rooms could be added over the next three to five years.

11 September 2014

EABB revises ban on HOA accreditation fees

EABB revises ban on HOA accreditation fees

The Estate Agency Affairs Board (EAAB) has revised the directive it issued earlier this year that outlawed the practice by many homeowners' associations (HOA) in residential estates of requiring estate agents to pay accreditation fees in return for exclusive rights to market properties in the estate.

The EAAB, the statutory consumer protection body of the property industry, said in a practice note on Friday that it was now permissible for HOAs to enter marketing arrangements with estate agents who chose to do so 'on condition that any fees payable constitute a reasonable cost of recovery for services rendered by the HOA'.

Sell your investment properties now - The Money Whisperer

A thought provoking article.  From my personal observations, there is a presumption amongst the general public that Property is a "Safe Investment".  I assume that this is based upon the fact that you are acquiring a tangible asset by buying the actual physical piece of land with the bricks & mortar attached.  When compared to investing in Bonds, Derivatives, ETF's, going long/short, etc. buying a physical thing is more logical to most people.

Buying a property is not a "safe investment" ... BUT ... buying a well-researched, correctly geared, competently-managed property is one of the best investments that you can make.  What Magnus has maybe missed is that you can walk into a bank and say "I would like some money to buy a property please" and your request will be considered but not so if you walk into a bank and say "I would like some money to buy equities please".

Gareth Shepperson
Commercial and Property Attorney

Sell your investment properties now - The Money Whisperer

Confessions of a property investor.

In many respects an investment advisor is like a priest hearing a confession from one of his congregants.

As part of your due diligence, which is required by law, you have to ask a potential investor a lot of questions about their investment history, returns on investments et al, in order to make a suitable recommendation.

Clients are also living proof of some of the investment themes and/ or scams that have blighted the local investment scene over the last ten to twenty years and in some cases even longer.

With older clients you will see a lot of long-term investment endowments, old style retirement annuities as well as a scattering of investment failures, especially the more recent and spectacular ones, namely Sharemax and Picvest.

As an aside, it seems investors who have lost money in any one of these property schemes - and in the case of Picvest who had not lodged a complaint at the Fais Ombud before March this year - have forfeited their right to lodge such a complaint. It would seem that a complaint lapses after three years from the time you became aware of your loss or potential loss. I didn’t know this nor, I am sure, do the many thousands who have lost billions in these failed property syndications.

Everyone carries some investment scars. I have yet to meet a middle-aged investor who has not, along the way, made some major investment mistakes. The same goes for middle-aged investment advisors.

Slow or quick, you are still losing money

Some investors lose their money quickly, overnight, while others, lose their money or part of their money slowly over time, whether compared against inflation or against other investments.

Many people are aware that their investments are losing money but for some reason are unwilling to face up to this fact. They know an investment is failing but hang on hoping it will come right.

A great number of mostly middle-aged investors have one or more “investment properties” in their portfolios when you see them nowadays. This is a legacy of the previous property investment boom in which the banks, developers, the estate agents and also certain sections of the media all had a hand in creating.

The last boom in residential property prices lasted roughly from 2002 to the beginning of 2008, when the full impact of the National Credit Act kicked in and shortly thereafter, the Great Financial Crisis, which ended the party.

Since then many other countries in the western world, particularly the United Kingdom, certain parts of the United States, New Zealand and Australia, to name a few, have witnessed great revivals in property prices.

Not so here in SA. The residential property market is now in its seventh year of what I would call a bear market. I would describe a property bear market as one where gross prices are not, at the very least, matching inflation.

Unlike an investment market place - like listed equities where investment returns are sliced and diced in every conceivable manner - it is very hard to find good and reliable statistics on the residential property market. I would suggest that the best sources are John Loos from FNB and Jacques du Toit from Absa, even though they only reflect the actual experience of their respective banks.

The gap in providing reliable statistics on trends in the rental market has in recent years been filled by the dynamic Michelle Dickens from TNP.

Every quarter I carefully analyse the property statistics as best I can from these three sources, but it will never accurately measure the returns of each individual investor. At best it will just give a broad indication of the general trend in the market.

It’s during these “confessionals” with an investor that one can fairly accurately calculate returns on investment properties. You have the original purchase price, the annual rent, expenses such as municipal taxes as well as upkeep and repairs. That is if the investors keep a record of these expenses, which in many cases they don’t.

Property returns difficult to measure

I say fairly accurately as one still has to make an assumption on the potential market value of a property plus the “exit fee” of selling the property, if that is a consideration.

The calculation is also complicated by the level of gearing on the property; some are non-geared while others have been purchased with 100% bonds.

Not something that will make the actuaries happy but that is the best way to do it.

Over the past year so I have done many such calculations, including regular ones on my own portfolio of residential properties.

I have yet to come across an investor whose portfolio has been performing at better than a net rental return of 3% per annum, especially since the start of the bear market in 2008.

In many cases the resale value of those wonderful properties sold by means of leaflets at traffic intersections are worth less than the original purchase prices in nominal terms, not real terms.

In real terms some investors have lost between 30% to 50% over the last six years.

Offshore investments, depending on the timing, have given a return in excess of 200% and more over the past five years.

Penny dropping

But the penny seems to be dropping. Almost on a weekly basis now am I receiving emails from the Moneyweb community with the same message: my rental properties are not performing. The rental yield is dropping and is being squeezed by ever-rising municipal rates and taxes, tenants who cannot afford rising rentals as well as, in some cases, property owners who cannot get rid of non-paying tenants who are hiding behind the PIE-act.

And then there are vacant plots of land which do not even earn any kind of income. That must be the worst investment in the world: you have already lost half or more of the value of your original investment but you cannot get rid of it....

For an investment property to be or become an acceptable asset class you need certain prerequisites:

1. A growing and vibrant economy. Our economy is not growing in real terms. Only this week global banking group Morgan Stanley downgraded SA’s growth rate for the immediate future to below 2% for the year - even that number is considered to be optimistically high.
2. Access to bank finance. Bank lending has become very tight and is set to become even tighter in the near future in the wake of the African Bank collapse. That is forcing people to pay cash for their investment property - a very bad option.
3. Rising confidence. Our confidence levels are currently the lowest in 15 years and seem to be dropping every quarter.
4. A rising number of wage and salary earners who are your potential customers. It’s a myth that rentals are keeping pace with inflation, as some marketers of investment property often proclaim. Rentals are lagging inflation due to the fact that wages and salaries are not keeping pace with inflation, especially not on an after-tax basis. Most landlords I speak to “confess” that their tenants are getting free-passes on inflation- adjusted rentals. Its either that or an empty property.
5. Well-managed municipalities. The meltdown in many municipalities across the country, with perhaps the exception of the Western Cape, has been well documented. The wealth destruction in the form of dropping property prices in certain towns and even smaller cities as a result of this, is enormous.

But if they build, people keep on buying, hoping against hope that the laws of investments will be reversed for their particular development or purchase.

There is a lot of emotion in the decision to buy a property. When you buy a property you see the end product: it’s there in front of you and you can also live in it yourself if you have to. An investment portfolio on the other hand is simply a piece of paper with a number printed on it. On an emotional level the property wins hands down.

My final argument against further local property investments is the fact that it is a regionally-based and rand-based investment. It offers no protection against further declines in the currency.

Any foreigner who bought SA residential property in 2010 as an investment, for example, has by now lost between 50% and 70% in global purchasing terms.

Listed and liquid

A far better option to consider for those who have an affinity for property - and many do - is to invest in a property company listed on the JSE or a listed property fund. It gives you all the benefits of a property investment without the hassles and lack of liquidity that physical property represents.

As an “investment priest” it is my duty to speak the truth as I see it.

I do not see the situation turning around soon and I really would like to be proven wrong over time.

But right now, if I could, I would sell all my investment properties tomorrow and invest the money somewhere more liquid and where the returns can be measured and managed.
*Magnus Heystek is the investment strategist at Brenthurst Wealth.


10 September 2014

'What happens to sub-leases if a tenant is declared insolvent?'

'What happens to sub-leases if a tenant is declared insolvent?'

With commercial property management, there are cases that differ from residential letting in that there tend to be more sub-leases than in residential rentals, says Michael Bauer, general manager of the property management company IHFM.

It often happens that one company will rent a whole building and then sub-let portions of the space they have signed for and it must be remembered in these cases that the entity ultimately responsible for the rent is the company that signed the original lease with the landlord, he said.

But what happens in cases where the company that holds the lease is goes bankrupt?

Tenants cancel lease over lack of security

Tenants cancel lease over lack of security

The essential aspects of an advertisement of a rental property ought to be incorporated into the lease to avoid conflict. 

Often prospective tenants are attracted to what is offered in an advertisement.

Private listing by a landlord or advertising through a letting agent is a powerful way to find a tenant. This would entail honest, clear and concise wording in print and online, and may comprise a photograph or several photographs in an online advertisement that displays different aspects of the property.

The most important cases dealing with Business Rescue – Don Mahon

The most important cases dealing with Business Rescue – Don Mahon | South African Commercial Law Blog

All in all, I would say that there are about 35 judgments relating to business rescue which every practitioner or business with an interest in Business Rescue, should read.

In the coming weeks, I will provide a summary and analysis of each one in turn.

09 September 2014

When is a property deposit refundable?

When is a property deposit refundable?

Under South African common law the general rule that applies when an agreement fails is that the parties must restore the status to the position they were in before the agreement was signed, unless both parties have agreed that there is an exception to this rule.

When there is a sale of a property involved and the buyer puts down a deposit but is seen to have defaulted on the agreement, the seller can cancel and keep the deposit, says Lanice Steward, managing director of Knight Frank Residential SA.

08 September 2014

Land plan: Time to take a much closer look

Land plan: Time to take a much closer look

There's no doubt that the timing of the latest announcement about government's plans to limit foreign property ownership in SA was bad, and has done nothing to improve investor sentiment or business confidence.

'What is worse, though, is that Rural Development and Land Reform Minister, Gugile Nkwinti, has never really explained the thinking behind the proposed new land legislation in public, even though it has been on the cards since at least 2011, so we don't actually know whether the reaction it has engendered is too harsh - or perhaps not harsh enough,' says Berry Everitt of Chas Everitt.

05 September 2014

Property market solid despite slowing pace - FNB

Property market solid despite slowing pace - FNB

The solid performance of the residential property market was continuing despite the pace of growth in house prices appearing to have slowed in recent months, claimed FNB.

The bank's latest house price index revealed that average prices last month rose by 5.4 percent year-on-year compared to 6.4 percent in July.

John Loos, a household and property strategist at FNB Home Loans, said this was the seventh consecutive month of gradual slowing in average house price growth since the 8.6 percent year-on-year increase recorded in January.

What property indices and car sales data don`t tell you - Economic trends

What property indices and car sales data don`t tell you

Is the residential property market in fairly good shape while the automotive market is struggling?

At first glance, the most widely cited data tracking the performance of the property market and new vehicle sales seem to suggest that.

According to the FNB House Price Index released earlier this week the average house price for August rose 5.4% year-on-year. This represents the 7th consecutive month of gradual slowing, but the bank points out that while the pace of improvement has reduced, “it should not be confused with a deteriorating market”.

03 September 2014

Property leases buttressed by case and common law

Look out for my newest article on the Rental Housing Bill due to be published in the next edition of Homefront in the Business Day.

The article below describes the broarder legislative landscape in the world of Property Leases.


Property leases buttressed by case and common law

The rental Housing Act of 1999 is the main law that applies to a residential tenancy agreement between a tenant and landlord.
Other laws, or certain sections of them, may also have a direct bearing on the agreement and the contractual relationship between the parties.

02 September 2014

Major facelift for Tshwane's Menlyn mall

Major facelift for Tshwane's Menlyn mall

There is a lot of dust around the Menlyn Park Shopping Centre, but when it settles in 2016, the capital will have one of the largest malls in the southern hemisphere.

An artist's impression of a part of the refurbished centre.
The R2 billion refurbishment of the centre started in April, and once complete, in November 2016, will add about 50 000m2 to the centre and 200 new shops.

This will bring to 500 the number of shops in the centre and will cover an area of 170 000m2.

The centre is co-owned by Pareto Limited and Old Mutual Life Assurance Company.

The expansion of Menlyn will be a two-phase project, which is being led by retailer demand.

While there will be more shops offering a selection of local and international brands, shopper flows are also being simplified, making it easier to navigate the mall.

The new mall will also have plenty of natural light as the centre's expansion is designed to Green Building Council of SA green-star specifications.

For those who enjoy the social side of Menlyn, there will be a central gathering place, inspired by Italian piazzas, bringing together food and fun. There will be restaurants, fast food outlets, coffee shops and delis.

But it is not only the centre that is undergoing a facelift, as the centre's branding and logo will also be changing.

'For those who have grown up in Pretoria, Menlyn has been part of their childhood and is the venue of many shared memories,' says Peter Levett, chief executive of Old Mutual Property.

'Menlyn is not only a landmark in Pretoria but is synonymous with the things that make us feel good and look good - entertainment and fashion. It has gained iconic status over the past 35 years and we felt it was important to pay respect to this with the new brand and identity.

'The Menlyn Park shopper is fashion forward and appreciates quality design,' says Marius Muller, chief executive of Pareto.

'While the mall will proudly wear a new badge as it steps into its bright new future, it also retains a respectful tribute to its rich past.'

Pretoria News

Tshwane to sell off Sunnyside properties

Tshwane to sell off Sunnyside properties

Tshwane is set to sell 33 properties in Sunnyside, including heritage houses, a theatre and the House 22 Pub and Grill, as part of the Nelson Mandela Drive Development Corridor.

The proposed sale was delayed by a 21-year-old administrative bungle involving the description of properties and a subsequent attempt to rectify it.

This delay will deprive the city of a higher selling price, as over time the properties' condition has deteriorated, resulting in a decrease in their market value.

Joburg abandons pool registration plans

Joburg abandons pool registration plans

Joburg residents will not be required to register their swimming pools, as announced earlier this year by the City of Joburg.

However, they will have to submit plans and make an application if they build new pools, and the council says it will 'shortly announce the mandatory process for swimming pool plans or applications'.

As a result of public pressure following a series of public participation meetings with residents, the city has decided to withdraw the proposed bylaws because of costs and concerns about the capacity to enforce the by-laws.

H&M hush on the location of its SA debut

H&M hush on the location of its SA debut

The past two years has seen the transformation of South Africa’s retail sector, with more international fashion brands entering the local market.

The latest venturer is Swedish based Hennes & Mauritz (H&M) – and speculation is rife as to where the retailer will set up shop.

It’s already in the open that H&M will open its flagship store in Cape Town at the Victoria & Alfred Waterfront.