Flyt PropertyArticles by: Murray
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Events calendar continues to drive strong demand across Cape Town’s hospitality sector

Cape Town’s position as a leading global events destination continues to translate into strong, measurable demand within the city’s hospitality sector, with major events consistently driving high occupancy levels across hotels, aparthotels and other accommodation providers.

Flagship events such as the Cape Town International Jazz Festival, the Cape Town Cycle Tour, the Two Oceans Marathon, The Cape Town Marathon and business gatherings like the Mining Indaba continue to play a significant role in attracting international and domestic visitors at scale.

According to tourism and industry estimates, major events can push city-wide occupancy rates above 80%–90% during peak periods, with some properties reaching full capacity. The Cape Town International Jazz Festival alone has historically attracted more than 30,000 attendees, while the Cape Town Cycle Tour brings in around 30,000 cyclists, many of whom travel with support teams or family members. Similarly, the Two Oceans Marathon and The Cape Town Marathon draws tens of thousands of participants and spectators each year, and the Mining Indaba regularly hosts in excess of 6,000 delegates from across the globe.

For accommodation providers, this influx translates into extended stays, advance bookings and a broad mix of traveller profiles. Notably, the aparthotel sector has emerged as a popular choice for many of these visitors, particularly for group travel, longer stays and guests seeking flexible, self-catering options alongside traditional hospitality services.

WINK Aparthotels, which operates properties in Cape Town’s CBD and city fringe, reports a notably strong season aligned with the city’s events calendar.

“Cape Town’s events pipeline continues to play a vital role in supporting the hospitality sector,” says Derick Tait, Managing Director of WINK Aparthotels. “We’ve experienced consistently high occupancy during major events, with demand coming from both local and international markets. The diversity of visitors — from athletes and festivalgoers to business delegates — highlights the broad appeal of the city.”

This sustained performance reflects the ongoing efforts of Cape Town Tourism and the City of Cape Town, whose strategic focus on attracting and hosting large-scale events continues to yield positive outcomes for the local economy. “The city and its tourism bodies deserve recognition for the work being done to secure and grow these events,” adds Tait. “They generate real economic impact, not only for accommodation providers but for the wider ecosystem of restaurants, transport services, local businesses and tourism operators across the city.”

Momentum through the winter months

While summer remains a peak period, sustaining demand through winter is increasingly important. Events such as the Cape Town International Comedy Festival and the Good Food & Wine Show support activity, but there is room to grow both scale and frequency.

“Winter is traditionally more challenging, which is why developing the events calendar during this period is so important,” says Tait. “Even modest growth in winter events can lift occupancy and support a more balanced, year-round market.”

Cape Town’s events calendar remains a key driver of occupancy, with summer consistently delivering strong visitor numbers. Continued collaboration between the MICE industry, tourism bodies and the hospitality sector will be essential to building a more resilient, year‑round demand profile for the city.
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Aparthotels come of age as traveller expectations shift

There was a time — not that long ago — when checking into an aparthotel meant arriving at a dimly lit lobby, ringing a bell for a security guard doubling as a night receptionist, and being handed a jangling bunch of keys. If you were less fortunate, it was a keybox bolted to a wall and a late-night SMS with a code.

Inside, the unit was functional. Clean, perhaps. Minimal. Almost certainly unserviced. No concierge. No daily housekeeping. No café downstairs. It was accommodation — but it wasn’t yet hospitality.
That version of the aparthotel has largely disappeared.

Today’s professionally managed aparthotels occupy a defined space between traditional hotels and informal short-term rentals. More streamlined than full-service hotels, yet far more structured than standalone units, the segment has matured into a sophisticated hospitality category shaped by changing traveller behaviour.

According to Derick Tait, Managing Director of WINK Aparthotels, which owns and manages four properties in the Western Cape, the transformation has been driven by demand rather than design.
“The early aparthotel model was transactional,” says Tait. “It offered space and price, but not a consistent hospitality experience. Over time, guests wanted more — and we evolved with that demand.”

The growth of remote work, extended stays and lifestyle-led travel has reshaped accommodation patterns. What was once perceived as overlap between hotels and aparthotels has settled into clearer market segmentation, with each model serving distinct traveller needs:

Traditional Hotels Aparthotels
Short leisure stays Extended stays
Conference groups Remote workers
Package tourism Digital nomads
Traditional corporate Relocation clients

This clearer segmentation has allowed each accommodation type to refine its offering and meet its guests’ needs more effectively.

“The guest profile has diversified,” says Tait. “We’re seeing travellers who want autonomy and space, but also safety, brand consistency and service when they need it. That’s where professionally managed aparthotels fit.”

Rather than replacing traditional hotels — which remain essential for conferencing, luxury travel and full-service hospitality — aparthotels increasingly serve longer-stay and hybrid travellers whose needs differ.

Operationally, the aparthotel model has shifted just as significantly. Traditional hotels carry high fixed costs: 24-hour reception teams, food and beverage staff, extensive common areas and substantial service infrastructure. Aparthotels operate differently, with centralised management, leaner onsite teams and technology-enabled systems.

Dynamic pricing tools, central housekeeping coordination and scaled staffing models allow operators to manage occupancy and margins with greater flexibility.

“Technology has fundamentally changed how we operate,” says Tait. “We’re able to manage key functions centrally and optimise revenue across properties in ways that simply weren’t possible a decade ago.”

These structural differences result in distinct cost bases. While hotels remain capital-intensive and service-heavy, professionally managed aparthotels can operate with lower overhead per key, often translating into stronger margin resilience and pricing agility.

Perhaps the most significant evolution has been the shift from fixed service to optional service. Housekeeping can be scheduled rather than assumed. Catering is flexible — self-catered or provided. Lifestyle elements are integrated without replicating the scale of traditional hotel restaurants.
WINK, for example, has introduced deli and coffee shop concepts within selected properties, offering guests convenient food and beverage access while maintaining operational efficiency.

“Choice has become central to the model,” says Tait. “Guests don’t necessarily want daily servicing built into the rate, but they want the option. We’ve built our operations around that flexibility.”
This adaptability has proven critical in a market where seasonality patterns, length of stay and traveller expectations continue to shift.

The image of a security guard behind a makeshift desk handing over keys may still linger in public memory. But the modern aparthotel has moved well beyond its informal beginnings.
“We’re no longer just handing over keys,” concludes Tait. “We’re operating structured, professionally managed hospitality assets. The segment has matured — and it continues to adapt as the market evolves.”

In destinations such as Cape Town, where international visibility has increased and traveller profiles have diversified, this evolution reflects broader global shifts in how people live, work and travel.

The rise of the aparthotel is less about disruption and more about alignment, responding to demand with a model that sits between traditional hotels and short-term rentals, offering space, flexibility and service on the guest’s terms.
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Responsible short-term rentals: Protecting Cape Town’s heritage neighbourhoods and tourism economy

Cape Town’s tourism sector has evolved into a diverse mix of accommodation options ranging from traditional hotels, owner-managed Airbnbs and professionally operated aparthotels—serving holidaymakers, digital nomads, international visitors, Meetings, Incentives, Conferences and Exhibitions (MICE) delegates and the broader events industry. While this evolution has expanded visitor choice and fuelled new economic opportunities, it has also placed pressure on residential communities and intensified calls for clearer, more accountable management of short-term rentals.

The rapid rise of these short-term rentals has undeniably boosted Cape Town’s tourism economy, creating new streams of income and diversifying accommodation options. Yet the sector has increasingly come under scrutiny as residents and hospitality stakeholders raise concerns about affordability, neighbourhood character and responsible tenant oversight. This evolving hybrid accommodation market now demands a more cohesive regulatory framework—one that recognises both the economic importance of tourism and the necessity of protecting heritage neighbourhoods and long-term residents.

Cape Town remains an international destination of exceptional standards, consistently attracting travellers seeking immersive cultural experiences. Among its most distinctive attractions, Bo-Kaap stands out as a globally recognised heritage precinct.  Its vibrant cultural fabric, historic streetscapes and irreplaceable identity make it a neighbourhood that must be preserved, even as visitor demand grows.

Bo-Kaap’s enduring appeal perfectly illustrates the delicate balance between cultural preservation and tourism growth. As visitor demand rises, the role of short-term rentals becomes central to Cape Town’s visitor economy. In 2023, more than 700 000 travellers used short-term rental platforms in the city, contributing billions of rand to the tourism value chain. Industry data indicates that a single short-term rental unit in Cape Town achieved a median 71% occupancy rate between August 2023 and July 2024, generating more than R420 000 in gross income over the year. Communities like Bo-Kaap stand to benefit from this economic momentum—but only if growth is channelled responsibly and in partnership with residents.

The rapid expansion of the sector has also reshaped housing dynamics. A City of Cape Town Local Spatial Development Framework report found that approximately 70% of inner-city units are now operating as hotels or short-term rentals, significantly reducing long-term residential availability. As listings increase, so too do calls for structured, accountable and community-aligned management.

Ryan Flowers, Managing Director of Flyt Property Investments, emphasises that short-term rentals must actively contribute to neighbourhood resilience if they are to be sustainable: “A short-term rental should contribute meaningfully to its surroundings. It’s not simply accommodation—it’s an opportunity to showcase the culture, spirit and unique fabric of an area in a way that brings shared benefit. When operators take this responsibility seriously, the impact is tangible: local eateries draw more foot traffic, independent retailers gain momentum and micro-economies begin to flourish. Our work at Eaton Square in Cape Town’s Southern Suburbs demonstrates this clearly. Through our hospitality management brand, WINK Aparthotels the development has been managed in a way that attracts complementary businesses that now serve both residents and visitors, strengthening the neighbourhood rather than disrupting it.”

Flyt has intentionally designed its Bo-Kaap development at 150 Buitengracht to mirror this integrated model, collaborating extensively with the local community during the development’s design phase. With 70% of units already sold before public release, the mixed-use development will be managed by WINK Aparthotels to ensure consistent standards, professional oversight, community engagement and alignment with the cultural and heritage values of Bo-Kaap. The objective is to create a responsible hospitality presence that brings economic activity to the area while safeguarding what makes the neighbourhood unique.

Flowers adds that progress must be collaborative: “Bo-Kaap’s heritage is irreplaceable. Its preservation must sit at the centre of how tourism and development evolve in the area. Regulation, operators, residents and the tourism sector need to move in the same direction. When short-term rentals are professionally managed and aligned with community priorities, they can add genuine value to neighbourhoods rather than placing them under strain.”

As one of Cape Town’s most important economic drivers, tourism can only remain sustainable if its benefits are shared and its impacts carefully managed. Moving ahead, meaningful collaboration between short-term rentals, hotels, community representatives and local businesses will be essential to ensure that neighbourhoods remain vibrant, resilient and culturally intact.
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City of Cape Town approves 150 Buitengracht development after rigorous redesign and community collaboration

The City of Cape Town has officially approved the 150 Buitengracht development by Flyt Property Investment, bringing to a close a rigorous multi-year process marked by extensive design revisions, heritage considerations, and community collaboration.

Originally launched in 2021, the project has evolved significantly in response to public engagement, heritage concerns, and insights raised by the Bo-Kaap Civic and Ratepayers Association. Situated at 150 Buitengracht Street, the development lies adjacent to the culturally significant Bo-Kaap and the historic Auwal Masjid, which prompted heightened scrutiny and a high level of design sensitivity to preserve the integrity of the area.

“The engagement process reflects a remarkable effort by the facilitators, Bo-Kaap community representatives, and the developer,” said the City of Cape Town’s Municipal Planning Tribunal (MPT). “It resulted in consensus on the form the development should take.”

A facilitation process led by the South African Heritage Resources Agency (SAHRA) between 2022 and 2023 resulted in a substantial redesign, documented in a 63-page report dated 30 June 2023. The revised proposal reflects significant adjustments aimed at preserving the integrity of the Bo-Kaap’s heritage while addressing community concerns.

Key changes include:

Element Pre-facilitation Proposal Current Proposal
Maximum Height 8 storeys 6 storeys (reduced by 6.6m)
Buitengracht Street Façade 5 storeys 3 storeys (40% less)
Site Coverage 652m² 493m² (24% less)
Floor Factor 3.9 3.6
Total Floor Area 2,586m² 2,385m² (201.5m² less)

The City found the final design to be “context-sensitive,” striking a careful balance between modern urban renewal and the preservation of Cape Town’s unique cultural and architectural heritage.

“This has been a long and rigorous process,” said Ryan Flowers, Managing Director of Flyt Property. “But we are proud to have worked alongside the City, the Bo-Kaap community, and heritage bodies to ensure 150 Buitengracht honours its surroundings while adding value to the urban fabric of Cape Town.”

Flyt Property Investment has committed to creating a thoughtfully designed mixed-use building that blends with its environment while meeting the needs of a modern, vibrant city. The project will feature:

  • 67 residential units, ranging from studios to two-bedroom apartments
  • Ground-floor retail spaces, fostering a dynamic streetscape
  • A rooftop restaurant and entertainment area, offering panoramic views of Table Mountain and the city
  • Secure underground parking, ensuring convenience for residents and visitors

The City of Cape Town praised the process in its final remarks, stating: “The concerted and meaningful effort to accommodate residents’ concerns has resulted in a context-sensitive development that both protects heritage and promotes sustainable development.”

In his endorsement, Executive Mayor Geordin Hill-Lewis commented, “This is a positive and important milestone. The project is a model for how we can manage sensitive infill development that meets our city’s growing housing and business needs without losing the essence of who we are. The outcome reflects how collaboration can shape a more inclusive and heritage-aware Cape Town.”

With final authorisations now confirmed and all appeals now concluded, construction of 150 Buitengracht is expected to commence later this year, with completion targeted for 2026.

 
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Cape Town CBD property market sees surprisingly high demand

Investment into Cape Town’s CBD property market seems to be enjoying the first signs of post-pandemic optimism, with buyers keen to get in on the action, notably in the buy-to-let space. Justin van der Poel, investment consultant at Flyt Property Investments who are currently marketing units at One Thibault off Long Street, says that the sales team has been pleasantly surprised at the interest and closing rate of units in the development.

The firm initially offered units to investors via their popular Section 12J Flyt Select fund, which accounted for the majority of sales, but van der Poel says that the units have been popular since the expiry of SARS’s Section 12J tax incentive. Speaking at a media site inspection of the property, van der Poel confirmed the ongoing activity: “We continue to see strong interest week in and week out with only 20 units of the 167 still available,” he said.   “The sales team have achieved 31 sales in the past three months, bringing the total sales up to 147 since we launched off-plan in May.” Show units will open this week and the team are expecting a further uptick in sales.

With currently as many as six new developments or refurbished buildings on offer in Cape Town’s CBD, Property Fund Manager Ryan Flowers says that the success at One Thibault can be attributed to the competitive selling prices and Flyt’s offering. “We could definitely say that the view has a lot to do with it, but our product offering at One Thibault is extremely attractive to investors,” he explains. Flyt have stuck to their Section 12J hospitality structure, with investment into One Thibault wrapped with on-site hospitality management company, WINK ApartHotels, taking care of rental management and administration. Entry level into their studio apartments kicks off at R895 000 where an expected rental return on Investment of 6-7%.

Residential apartments, which start from the fifteenth floor of the historic building, are almost complete and studio, one- and two-bedroom units are available for viewing. The property has been designed to include co-working space, laundry facilities, an on-site restaurant, a swimming pool and roof deck, reception and concierge as well as storage space, parking and high-speed internet.   
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WINK ApartHotels opens One Thibault to guests

One Thibault, a familiar icon of Cape Town’s skyline will open its aparthotel facilities to the travel industry on 1 November 2022.  The property was recently redeveloped to incorporate co-working commercial space, city apartments and will now include an accommodation-offering by WINK ApartHotels.

Cape-based management company, WINK ApartHotels has commenced with the management of 102 rooms at One Thibault, ranging from studio apartments, to one- and two-bedroom units, situated on floors 15 to 20 of the building. Units are all fully kitted to be self-catering, a popular option for short and long- stay guests and plans are in the mix to develop food and beverage offering within the next few months. General Manager and hotel specialist, Peter van Rensburg says that booking enquiries have already been excellent and interest in the units is high as the city enjoys a tourism recovery phase thanks to the so-coined post Covid ‘revenge travel’. “One Thibault wins the location race hands down, and the breathtaking views which can be enjoyed from every unit available are going to make many an Instagram story,” he said.

Towering over the CBD, One Thibault enjoys access to all that Cape Town has to offer; the natural amenities of Table Mountain, the nearby leisure parks, beaches, and vineyards; all enjoyed with the convenience of being in the city. The property is within walking distance of the Cape Town Convention Centre, is on the MyCity Bus route, and neighbours some of Cape Town’s best restaurants and nightlife in the famous Bree Street vicinity (La Parada, Sza Sza and Villa 47  to name a few).

One Thibault Square, originally known as the BP Centre was completed in 1972 and was designed with a 34-degree diagonal twist, which puts it on a north–south axis which means that all the facades have views of either the mountain or the harbour. WINK One Thibault is the tallest residential building in Cape Town and the hotel accommodation-offering, with its contemporary decorated apartments make the most of these panoramic views of the vibrant city and all it has to offer.

Opening rates start at R1120 per room per night and bookings can be made at www.winkaparthotels.co.za

Ends

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About WINK ApartHotels

The WINK Aparthotels group manages a collection of trendy aparthotel properties throughout Western Cape, South Africa. The group currently manages four properties; WINK Foreshore, which is situated in Cape Town’s CBD, WINK Eaton Square, in the southern suburbs of Diep River, WINK Quivertree which services the student market in Stellenbosch and more recently WINK One Thibault, towering over Cape Town’s CBD.

WINK Aparthotels provides travellers with the convenience of apartment living, the comfort,  and luxury and convenience of a hotel.

Website          :           http://winkaparthotels.co.za  

Email               :           info@winkaparthotels.co.za  
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Flyt Property Investment and TriStar Construction join forces on Rosebank development

Flyt Property Investment have negotiated a partnership with TriStar Construction at the recently launched Saxon Square.   Situated in Rosebank, Saxon Square is Flyt Property’s first managed development in Johannesburg and their partnership with TriStar translates into an appealing investment opportunity for investors looking for a comprehensive short-term hospitality rental management solution with excellent returns.  

Flyt’s Development Manager, Ryan Flowers says, “We believe in adding value to property through joint ventures and we’re very happy to be involved in creating this investment opportunity with TriStar on a really outstanding development.”

Saxon Square’s 134, fully-furnished studio and one-and two-bedroomed apartments will offer tenants the privacy and comfort of apartment living along with all the conveniences and services of a hotel – suitable for business and leisure travellers looking for short- and long-term rental options with easy access to transport links, retail outlets, restaurants and bars.  Amenities include a 24-hour concierge, biometric access control, coffee shop, rooftop garden and co-working lounge. Utility costs are low, with eco-friendly and cost-saving elements built into the design.

Flyt’s management team will oversee all functions required to run a unit including the paying of levies, and rates and taxes on the owner’s behalf, with on-site management being taken care of by the group’s long-standing management partner and Aparthotel specialists, WINK Aparthotels.  Additionally, with a Flyt-managed VAT refund claim, investors will receive 40% of the VAT on their purchase price back in the first year, in cash, providing investors with a bonus cashflow of 6%; the remainder of the VAT is used to fund the furniture pack and fit-out costs which means that the investor is  not out of pocket.

“The property’s location, excellent price point (with no transfer costs) and great returns combined with our on-site rental management option makes investment into Saxon Square a smart buy,” states Flowers.
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Property investment firm provides a waiting room for Section 12J opportunities

Property investment firm provides a waiting room for Section 12J opportunities

Cape-based investment property specialists, Flyt Property Investment, have made investment into hospitality property accessible for future projects via their Section 12J finance-facility fund, the Flyt Partnership 2022 fund. Subscription to the fund will provide investors access to the Section 12J tax-break before the 30 June cut-off, and allow them to park the funds while they wait for new projects to come on board.

The Section 12J tax incentive, which expires on 30 June 2021, could very well see South African investors suffering the “you don’t know what you’ve got, until it’s gone” blues, as last-minute realisations seem to have hit the investment arena. Investors eager to make use of the final opportunity SARS is affording taxpayers are looking to sign on any dotted Section 12J line, as the 100% tax deduction is the latest must-have item in any up-to-date investment portfolio.

Described by specialist Section 12J firm Anuva Investment’s Neill Hobbs as “hands down the best tax-saving opportunity imaginable”, the Section 12J incentive was introduced by SARS and treasury in 2009, as a means to boost investment into small-to-medium-sized enterprises and, in doing so, stimulate the economy and improve job creation. The incentive initially received little attention, as it seemed limited to the extremely wealthy and out-of-reach for average investors. However, as experts began to realise the nature and merits of the opportunity, so too did smart portfolio and investment managers and, over the last 8 years, the Section 12J sector has developed some attractive investment products. In response, property and Section 12J specialists married the handsome tax deduction with clever hospitality-suited property ownership and a new 12J asset class caught the eye of traditional investors.

However, at the eleventh hour, many Section 12J funds are pulling out all the stops to attract investors, and the scurry for last-minute offerings might result in an “anything goes” scenario, as fund managers hustle for attractive options. Ryan Flowers, Fund Manager at Flyt Property Investment, warns that investors should tread carefully as they shop for 12J investments, and make sure they are confident in the fund manager and happy with their underlying investment. The firm have sold out of their initial Section 12J hospitality property investment options leading up to the 2021 tax season deadline and have since received considerable interest in their ancillary tranche of property ownership via 12J at Cape Town’s One Thibault and The Upper East Side hotel apartments in the Woodstock area.

Flowers explains that the popularity of their offering was due largely to the finance facility offered through their Flyt Partnership Fund, which was fully subscribed and sold out of 3 developments by SARS’s February deadline. The Flyt R190 million-strong Partnership Fund provided investors with the funds to invest upfront while they waited for their tax refund. “The problem with any Section 12J investment is that you need the cash upfront to invest in order to receive the tax certificate and then the tax refund,” he points out. During a recent webinar Flowers announced that due to demand from current investors the firm has launched a 2022 Partnership Fund. “The Flyt Partnership Fund 2022 is aimed at making sure investors don’t miss out on the final Section 12J tax rebate, with a simple 5% deposit while they wait for the next Flyt project to come onboard. We enable qualifying investors to finance the portion of their 2021 income or company tax in our Section 12J fund and wait in the wings for the next exceptional Flyt property investment to become available, essentially providing a very easy way to make a 12J investment while acting as a tax cushion by shielding investors from their next tax contribution, without rushing in,” he stated.

According to the firm the Partnership Fund has, to date, saved investors R60 million in tax which has been used to acquire hospitality properties. Subscriptions to the 2022 fund will be capped at R300 million, and investors can contribute via their R2.5 million allowance for individuals or R5 million company allowance.

Property investment firm provides a waiting room for Section 12J opportunities
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Afrirent Holdings acquires Flyt Property’s WINK Aparthotels

Looking to broaden their hospitality offering into South Africa, WINK Aparthotels, part of Flyt Property Investment group, a property development and investment team, has been acquired by Afrirent Holdings (Pty) Ltd a Level-1BEE 100% black, female- owned company, via its subsidiary  Indalo Hotels and Leisure, effective 1 May 2021.

“The primary driver for the acquisition is to see growth beyond Cape Town for the WINK brand and to become a major player in the serviced apartments and long-stay markets,” explains WINK General Manager Lauren Barnard.    WINK’s focus on international trends specific to the modern traveller ensures that its aparthotel offering ticks all the boxes in terms of innovation, functionality and accessibility, offering short- and long-term accommodation solutions catering to domestic and international business and leisure travellers, digital nomads and migrant workers.

WINK Aparthotels currently operates two locations: WINK Foreshore and WINK Eaton Square in Dieprivier, with an additional two new properties in the pipeline.  The recently launched WINK Cafe eateries will also provide an excellent add-on to their offering.

CEO of investment house Afrirent Holdings Senzo Tsabedze says that besides being a perfect fit for the Group’s business model, the main aim is to elevate the WINK Aparthotel brand and roll out its offering throughout South Africa.    The company structure and management will largely remain the same, falling under the leadership of Barnard and her team, working closely with hospitality industry veteran Andrew Rogers, CEO at Indalo.

Commenting on the sale, Zane de Decker, MD of Flyt Property Investment, states that the launch of WINK in 2019 with a view to providing a modern, new hospitality offering to the industry to operate and manage properties in the group’s highly successful 12J property investment portfolio, despite Covid restrictions and enormous pressure on the hotel sector, has seen WINK grow into a successful hospitality management company.  “The sale of the business to Afrirent via Indalo, whose focus is on high-end international and domestic tourism and travel, is a solid decision that will benefit both WINK and its shareholders and see the brand flourish even more,” he comments.

WINK Aparthotels will continue to operate and manage all future properties in the Flyt Property Investment portfolio in Cape Town.
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Sold Out – property sector gets a boost, thanks to tax break

Property sales in the first quarter of 2021 enjoyed a significant boost thanks to SARS’ Section 12J tax incentive. Demand for investment opportunities into qualifying property developments that include hotels, lodges, student residence or serviced apartments resulted in some developers selling out all units via the Section 12J structure. Qualifying section 12J investments offer individuals, trusts and companies resident in South Africa a tax rebate on investments (up to 45% for individuals), if made through an approved venture capital company.

Cape-based Flyt Property Investment reported that all units at Eaton Square in Diep River, WINK Aparthotels in the CBD precinct of The Foreshore, and Stellenbosch student accommodation development, Quivertree, sold out over 150 units via their structured fund, managed by Section 12J specialist fund managers, Anuva Investments.  Fund Manager, Ryan Flowers details that his sales team saw significant interest in their 12J structured products with a flurry of investors signing up once Finance Minister Tito Mboweni announced that the incentive would not be extended beyond the June cut-off.  “There was keen interest in our Flyt Select and Partnership funds whereby investors can take part in the 12J incentive, enjoying 100% tax deduction when investing in either a specific sectional title unit individually, or share in the ownership of a number of units along with Flyt and other investors/partners,” Flowers explains.

The popularity of the fund can largely be attributed to the 100% loan facility that has been made available to investors and taxpayers who do not have the finance upfront. A 5% deposit secured the investment; and a loan was made available for the balance to qualifying taxpayers while waiting for their SARS refund. This loan is repaid partly by the investor’s tax refund from SARS and the balance settled either in cash or with a replacement home loan.

Zane de Decker, CEO of Flyt Property Investment says that for anyone interested in property investment, there really is no better time to take advantage of this remarkable incentive. “Investors have the unique opportunity to allow SARS to put down the deposit on their property investment for them (up to 45% depending on the investor’s tax bracket). This not only aids in investors’ cashflows upfront but has huge implications on interest savings as in most cases the required home loan is significantly reduced, boosting property rental cash flows further.  For those investing cash this equates to major discount on the purchase price of the unit,” he points out.

The Section 12J scheme expires on 30 June 2021, thereby affording interested investors one last opportunity to receive the tax deduction via a qualifying investment.  The industry expects huge interest in the final period; Flyt Property Investment will soon launch 3 new projects that will be made available to investors via their Section 12J products.