Property News

Mother City development offers tax break

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ape Town’s new apartment and mixed-use property development The Harri is selling the last of its 48 studios and lofts to South Africans keen to get a massive tax deduction by investing in a Section 12J tax investment scheme.

Partnered with Anuva Investments Limited, a registered venture-capital company and financial services provider, The Harri’s Section 12J Flyt Select Fund allows local buyers at the highest marginal tax rate of 45% to deduct from their tax liability the full amount of a new unit in the Harrington Street development in Cape Town’s East City Precinct. Only 12 of the 48 units remain unsold, priced between R1,399,995 for a studio and R2,699,995 for a loft.

“Government’s intention of stimulating economic activity and creating jobs by designing the Section 12J mechanism has been a win-win not only for local buyers, but also for us as developers,” says Jeffrey Kleu of property‑development company Sepia and Silk.

“We’ve been able to keep a workforce of 250 people and 10 local businesses employed and contracted, while still offering a prime opportunity for buyers in an expensive area,” he says.

The development offers a blend of apartment living with open‑plan, tastefully furnished co-living and co-working spaces, and includes fireplace lounges, a TV room with a large smart TV and access to Netflix, three dedicated Zoom video-chat rooms, a rooftop terrace with a gas braai and mini-bar area, and hotel-grade amenities like Wi-Fi, a concierge, a housekeeping service, and 24‑hour security.

SARS’s Section 12J tax break allows property buyers to write off their investment amount against their tax liabilities in the year in which they buy, provided that the investment is with a qualifying small to medium-sized enterprise (SMME). SMMEs are considered crucial for economic growth and job creation. Qualifying SMME sectors include hospitality, renewable energy and manufacturing.

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“We’ve set aside a pool of units at The Harri to form part of our new aparthotel offering which will start operating from the moment we launch in May this year,” says Kleu.

An aparthotel combines the best of five-star hotel amenities with luxurious self-contained apartment living.

A buyer’s apartment is rented out to short-term staying guests, and the income generated is put towards servicing the buyer’s bond. The buyer covers any shortfalls or retains any surplus.

The wealthy’s top hobbies revealed

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he most popular hobbies of wealthy South Africans were recently reviewed in a collaborative study by wealth intelligence firm New World Wealth and luxury lifestyle development Steyn City. Golf is currently the most popular pastime of local high-net‑worth individual (HNWIs) with collecting art and cycling also high on the list.

Golf is particularly popular among retired HNWIs who enjoy access to some of world’s best golf courses, including Steyn City, Fancourt Links, Highland Gate, and the Gary Player golf course in Sun City.

The coronavirus pandemic is seen to have revitalised golf as it allows for easy social distancing and many HNWIs and executives are now working from home with more golf played during weekdays. Cycling and watch collecting have become more popular among local HNWIs over the past decade (2010 to 2020). The rise of these two hobbies is a global trend that is mirrored in most other major markets globally. This was evident at Steyn City last year, when pro and casual cyclists took advantage of this lifestyle development’s 45km mountainbike trail which had been upgraded for the 947 Ride Joburg MTB Race.

The track has now been endorsed by many high-profile competitive cyclists, including Fritz Pienaar, holder of multiple South African mountain bike championship titles.

Popular watch brands for local HNWI collectors include Patek Philippe, Breguet and Vacheron Constantin. The prices for these watches range from R300,000 to well over R10m.

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Hyde Park Corner rolls out solar panel project

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he carbon footprint of Hyde Park Corner has decreased with the installation of a 384kWp solar PV system on the two office block roofs and carports on the North Eastern parking deck.

The system, rolled out by Solareff, consists of 900,430W half-cut Mono Percium panels currently viewed as the most commercially efficient panels available. The panels will generate approximately 674,400kW/h energy per annum, translating into a saving of approximately 701.4 tons in carbon emissions every year.

This equates to 5.38 % of the total annual energy requirements at Hyde Park being produced from renewable resources.

The mall’s holding company is conscious of the business’s environmental impact. Hyprop CEO Morné Wilken says, “As part of Hyprop’s drive to continually minimise the impact on the environment, one of our key focus areas is to reduce the consumption of natural resources where possible. The installation of solar – a renewable energy source – is only part of our drive towards positive change in creating safe environments and spaces where people can connect and be part of a community. At completion, six of our nine malls will use solar power.”

Hyde Park Corner’s general manager Jacqui McGeehan says, “This roll-out of solar panels will also mitigate the risk of continuous, rising electricity costs for the company. The electrical power generated by the solar system is fed back into the centre grid and consumed in total.”

Foreign property buyers eye SA

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ales to foreign buyers across Cape Town’s Atlantic Seaboard and the City Bowl has seen Seeff signing deals worth R178m over the last four months. This includes a luxury villa in Fresnaye which sold for R36m in December last year to a buyer from Dubai as holiday home.

Other high-value transactions include three in Camps Bay, being R17,7m and R21,5m to Americans, and R19,5m to a Malaysian.

Ross Levin, managing director, Seeff Atlantic Seaboard and City Bowl, says there has been a notable uptick in the market including demand from foreign buyers, especially from the European countries which have experienced hard lockdowns and are in their winter months.

However, there has also been a massive influx of clientele from the African continent, high net‑worth Nigerians in particular, which has mainly impacted the short-term rental market of luxury properties.

Sales to foreign buyers included the UK, Switzerland, China, Malaysia, Italy, the USA, the UAE, Nigeria and Greece but enquiries are coming from across the board including Northern European countries such as Germany, the Netherlands and others.

The latest sales statistics for the Atlantic Seaboard and City Bowl confirm more sales to foreign buyers in December representing about 20% of all transactions compared to just 7% for the previous two months.

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