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Time for new investment strategies

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Focus on what you need now and not what you want

Property investors should immediately “re-engineer” their investment strategy and focus on property yielding short-term results rather than placing the emphasis on long-term profits or volumes, says Norman Raad, chief executive of Broll Auctions and Sales.

Raad says: “It’s time for investors to make the most of what they own, get rid of the excess and concentrate on what they need – not what they want. For years, ‘more’ was everything but now it’s time for increased selectivity to protect cash flow.”

He believes some properties are now undergoing “normalised correction” but still offer great long-term value.

“However, in the same breath, some properties are virtually obsolete with demand non-existent so alternate use and conversions would be a wiser and the only option.

“As 2020 begins, we have already seen significant movement in the property sector – more consolidations and more prudent decisions indicating that this year will bring less procrastinating and more decision-making.”

Raad says last year was an extremely difficult year with load shedding, corruption and unprofessional behaviour, rampant.

“Real estate investment trusts were battered last year as property prices plunged because of rent reversions, and company collapses, as demand lost the battle against supply. The property sector has enjoyed the longest and most profitable run since 2003, so perhaps change was inevitable.

“Property is still an ideal investment – just don’t expect the compounded escalations and growth experienced over the past decade,” he cautions.

For Broll’s first major multi-property auction of the year in Joburg on February 19, the offering will include a prime KZN investment: Mkuze Plaza in the main road of the town in the north of the province. Also on offer in other parts of South Africa will be sought-after fuel stations, leisure properties in George and Lanseria and more.

For more details about the auction, phone 0827821134 or 0877008289 or email auction@broll.com or visit www.brollauctions.com.

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