{"id":835379,"date":"2025-08-19T15:31:35","date_gmt":"2025-08-19T13:31:35","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=835379"},"modified":"2025-08-19T15:32:50","modified_gmt":"2025-08-19T13:32:50","slug":"two-south-african-companies-are-beating-all-of-australia","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/property\/835379\/two-south-african-companies-are-beating-all-of-australia\/","title":{"rendered":"Two South African companies are beating all of Australia\u00a0"},"content":{"rendered":"\n

Africrest Properties and Divercity Property Group produced more multifamily apartments than the entirety of Australia, as middle-class South Africans look for affordable housing options. <\/p>\n\n\n\n

According to Knight Frank\u2019s Horizon Report, Australia produced 4,349 multifamily apartments last year. This was a record high for the country.\u00a0\u00a0<\/p>\n\n\n\n

At the same time, Johannesburg-based Africrest and Divercity produced over 4,500\u00a0multifamily apartments alone last year.\u00a0<\/p>\n\n\n\n

Multifamily housing means that a single landlord owns, rents, and manages the entire property. The apartments are not individually sold. This structure is also known as Build-to-Rent.\u00a0<\/p>\n\n\n\n

The asset class is well established in the United States and has seen strong growth in Europe and Australia.\u00a0<\/p>\n\n\n\n

The model gives tenants access to professionally managed properties and consistent service. Institutional investors are also drawn to the asset class due its stable and predictable cash flow. <\/p>\n\n\n\n

Africrest is increasingly building these properties as a response to a market need for middle-income housing for rent.\u00a0<\/p>\n\n\n\n

It focuses on significant work nodes, including the Sandton and Bryanston CBDs. This is a targeted approach to urban denisification and addressing housing shortages. <\/p>\n\n\n\n

Divercity is another major developer in the African Multifamily sector and has embarked on major large-scale developments, including the Barlow Park in Sandton. <\/p>\n\n\n\n

Given its construction over the last few years, the R3 billion Barlow Park development will likely be known to regular users of Johannesburg’s M1 highway. <\/p>\n\n\n\n

The mixed-use area features a 5,500 sqm retail centre, which includes a Checkers, Clicks, Mr Price, PEP Home, and PnP Clothing. <\/p>\n\n\n\n

It also features a Curro High School, which anchors the development. The first 700 apartments launched in 2024, with another 800 scheduled for this year. Apartments start from roughly R5,000  per month. <\/p>\n\n\n\n

\u201cWe are in an exciting time in South Africa where multifamily is becoming established as an institutionally invested asset class, with growing investor interest and appetite,\u201d said Carel Kleynhans, CEO of Divercity.<\/p>\n\n\n\n

The momentum isn\u2019t slowing either, as it is growing its portfolio by over 2,000 units per annum and sees a significant runway for further growth and healthy competition ahead.<\/p>\n\n\n\n

Africrest plans to expand its portfolio to more than 10,000 apartments in the next 18 months. <\/p>\n\n\n\n

Boost for sectional titles <\/h2>\n\n\n
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Barlow Park in Sandton<\/figcaption><\/figure><\/div>\n\n\n

Although Africrest and Divercity own all of the buildings that they put out for rent, the latest data from FNB<\/a> also shows that there has been a major boost for owners of mor traditional sectional titles in South Africa<\/p>\n\n\n\n

The latest FNB House Price Index (HPI) remained steady in July, averaging 3.7%. House prices are now rising faster than inflation, which stood at 3% per the latest figures, resulting in real increases. <\/p>\n\n\n\n

Growth in sectional title properties also outpaced freestanding homes in South Africa, 3.8% to 3.7% year-on-year in July. <\/p>\n\n\n\n

Siphamandla Mkhwanazi, FNB Senior Economist, said that the shift in buyer sentiment towards sectional title properties reflects evolving lifestyle preferences and cost pressures.. <\/p>\n\n\n\n

After a relatively aggressive hiking cycle and real wage underperformance since 2021, buyers gravitate toward more compact and cost-effective housing. <\/p>\n\n\n\n

More companies are now also ordering their employees back to the office, meaning that the need for larger spaces with home office spaces is becoming less popular. <\/p>\n\n\n\n

Thus, the pandemic-induced premium for bigger homes has waned. The upward trend in sectional title values persists even as developers have responded preemptively. <\/p>\n\n\n\n

Since the start of the year, the supply of new flats and townhouses typically sold or leased as sectional titles rose to 4,866, up 13.5%. <\/p>\n\n\n\n

That said, the increase follows years of decline and should be viewed in the context of an incredibly low base. <\/p>\n\n\n\n

The pipeline supply of sectional titles remains weak, and year-to-date, building plans approved by municipalities for new flats and townhouses are down 21.2%. This suggests continued supply constraints. <\/p>\n\n\n\n

The imbalance will likely lead to further price growth in sectional titles, particularly in well-located areas with strong amenities and transport links.<\/p>\n\n\n

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Multifamily housing is becoming a hot property market in South Africa, with Africrest and Divercity building more of these units than the whole of Australia managed in 2024.<\/p>\n","protected":false},"author":95,"featured_media":835383,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12755],"tags":[16558,13868,76,7585],"class_list":["post-835379","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-property","tag-africrest","tag-divercity","tag-fnb","tag-knight-frank"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/835379","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=835379"}],"version-history":[{"count":3,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/835379\/revisions"}],"predecessor-version":[{"id":835442,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/835379\/revisions\/835442"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/835383"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=835379"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=835379"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=835379"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}