Balwin launches rental business as fewer South Africans can afford to buy houses
Property company has turned its focus to the rental market to cope with an oversupply of residential property
Balwin Properties, SA’s largest seller of sectional title property, has turned its focus to the rental market to cope with an oversupply of residential property aimed at the middle-income segment. To this end the group, which is backed by elusive billionaire Jonathan Beare, launched a rental business on Wednesday, which it intends to list within the next five years.
The group, which has a market capitalisation of R1.46bn, said it had to supplement its income by renting out apartments and not just selling sectional title units. Balwin Rentals is 75% owned by a consortium of ultrawealthy investors including Beare, with the remaining 25% held by Balwin. In terms of the initial agreement, Balwin will dispose of 156 units to Balwin Rentals for a total cash consideration of R98.43m. Profit after tax from the disposals of R18.54m will be reinvested into Balwin’s existing development pipeline. As many as 144 units will come from Balwin’s Greenpark development while 12 will come fro...