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.

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.

Cape-based Flyt Property Investment has announced the official launch of Quivertree, a trendy new property offering in the university town of Stellenbosch, featuring 102 self-catering, fully-furnished apartments for long- and short-term rentals or for purchase, geared not only for the student market also but for young professionals, transient  workers and business travellers.

Shoe-box living and hostel-like halls of residence are a thing of the past, with recent property trends paving the way for next-level accommodation that encompasses clever use of space, furnished offerings, shared work and living areas, on-site amenities, hospitality services and security.  “We wanted to create self-catering pods with all the extra bells and whistles for students, businessmen, golfers and everyone in between!”  says Zane de Decker, MD of Flyt Property Investment.

Quivertree is a 3-storey, mixed-use development that is a blend of student accommodation and short-term stays, bolstered by a strong corporate market comprising 102 studio/one- and two-bedroomed, fully-furnished apartments, some with balconies.    On-site services include a laundry, housekeeping, 24-hour security, a reception desk, underground parking and communal entertainment areas.  WINK Café, launching next  year will serve breakfast, lunch and dinner daily, providing a cool space to catch up with friends, do some work or make a few calls – all made eaiser with complimentary, uninterrupted wi-fi.

Quivertree’s location is super-convenient with Stellenbosch city centre just a 5-minute drive away and is in close proximity to the University’s campuses.  Cape Town International Airport and both national roads are all within a 20-minute radius – added to which the town is abuzz with shops, restaurants, cafes, boutiques, galleries and museums, and, of course, its wine routes.

De Decker adds that with price points starting at R979 000, Quivertree definitely makes for affordable living in Stellenbosch.  All 102 apartments are up for sale through the group’s Section 12J Hospitality Select Fund, making this an even more attractive investment, what with the associated tax breaks and benefits.    Furthermore, a rental pool, managed on-site, will give investors a hassle-free, hands-off investment.

The talk on the hospitality street is what Level 1 is going to do for the industry – how has lockdown affected the hotel landscape and its offering,  will it recover, and what does the future hold?  Local tourism is likely to drive this recovery until our international borders re-open, but what is this post-Covid guest looking for in terms of accommodation?

The  upside is that the downtime has allowed for some re-thinking and re-invention from the hospitality sector – behind closed doors much has been deliberated and carefully considered and despite the odds the industry has rallied and risen from the ashes – they are ready to open their doors again and offer the excellent service and facilities that have become synonymous with the hospitality sector in South Africa.

Enter WINK Aparthotels, an exciting new hospitality group launched by Flyt Property Investment, who have pooled their existing and ever-growing property portfolio into a hospitality offering that ticks all the boxes in terms of innovation, functionality, affordability and accessibility, perfectly positioned to offer short- and long-term accommodation solutions in Cape Town.

Zane de Decker, MD of Flyt Property Investment, says that their offering aims to provide guests with the convenience of apartment living combined with the luxury and comfort of a hotel.   “Pre-Covid we already saw a turn towards aparthotels, self-catering apartments and Airbnb type accommodation – more and more people are opting for aparthotels versus full-service hotels as they prefer that home-away-from-home atmosphere which allows them more flexibility, privacy and/or a fully-serviced option.”

WINK Foreshore and WINK Eaton Square in Diep River both feature fully-furnished, self-catering apartments and studios with kitchens and kitchenettes for short- and long-stay rentals.   A  meal delivery service is available to guests and tenants, as well as a daily or weekly cleaning service in line with National Health and Safety requirements.  There is fast, stable Wi-FI connectivity and on-site facilities include a concierge and innovative common areas,  along with the newly launched WINK Café that is open throughout the day for a healthy fix.

Head of Hospitality, Lauren Barnard says that they have created a bespoke, contemporary accommodation solution that caters to domestic and international business and leisure travellers, digital nomads and migrant workers: “There is something for everyone.”

Plans are afoot to add another aparthotel in Stellenbosch to their portfolio within the year.

Moving into Level 1 of lockdown we have started to see signs of what appears to be normality returning as we collectively breathe a sigh of relief (without steaming up our sunglasses). But can we – or should we – remain twice-shy with the bite of COVID-19 still fresh in our minds, albeit 180-odd days in?  Have we become more risk-averse, and should we be?  What has this pandemic meant for property purchasing decisions and is there still money to be made from investing in property?

The mood in the property market seems pretty upbeat lately – five rate cuts within the space of seven months have taken the prime lending rate to a 50-year low of 7%, making purchasing a home much more accessible and achievable.  For example, on a bond of R1 500 000 (at prime on a 20-year term) the repayment amount will have dropped from  R14 475 at the beginning of the year to R11 629 after the recent rate cut.

Estate agencies are achieving record sales months, bond originators report that home loan applications are up close to 60% year-on-year, and banks are regularly (or at least half of the time, according to Ooba) giving up to 100% bonds.   There also seem to be more vacancies than usual, definite pressure on rentals and a lot of people are selling.

So this raises the question – should we be fearful or greedy – is it a good time to invest in property?  Ryan Flowers, Fund Manager at Flyt Property Investment, says it’s definitely a buyer’s market and that with interest rates at a record low, you can expect borrowing to increase, which will reflect in increased buying activity in the market.

“Coupled with the abundance of well-priced stock, some incredible tax-saving property investment opportunities using SARS’ Section 12J incentive,  and the willingness of banks to lend to the consumer, these factors mean that buyers are certainly in the driver’s seat and can cherry-pick the dream home that may have been out of reach until now,”  he explains.  These conditions have already impacted property prices by as much as 2%, and should, at least in the short-term, continue to increase, as we have seen already seen on FNB’s House Price Index.

Although it is difficult to predict what the longer-term impact of the pandemic will be and whether we will see a muted recovery in house prices, what is clear is that the current market conditions do not come around every day.  For investors who have a stable income and/or reliable, paying tenants, can afford to borrow from the banks and, more importantly, do not rush their investment decisions – it is certainly worth considering.

Cape-based Flyt Property Investment has recently announced an inventive means for South Africans to take advantage of Government’s Section 12J tax incentive when the chips are down. Flyt Partnership Fund, which is restricted to R300 million, allows investors to take part in the fund on a 100% loan basis. The R300 million has been made available as loan capital to investors to participate as partners in the fund. A minimum investment of R1million is required; however, an investor need only contribute 35% (i.e. R350 000 per R1 million), with Flyt Property Investment contributing the remaining 65% on the investor’s behalf. To add to the offering, Flyt may also extend a loan for the 35% required to qualifying investors.

In essence, investors can make a R1 million Section 12J investment by putting down only R350 000, which will be returned to individuals via their SARS tax refund (subject to investor’s own tax rate). The company has also incorporated a bridging loan facility for qualifying investors who would like to borrow the 35% portion while waiting for the SARS refund.

Comparing South Africa to a global tax haven, Zane De Decker, MD of Flyt Property Investment, describes the opportunity as “a fantastic way to get your tax back via Government’s 12J incentive and invest it into property.” De Decker reports that his team tested the market in with their Partnership product in February 2020 and raised R24m via word of mouth within a few days with investors showing huge interest. “We increased our capacity to provide funding for this product and expect a keen uptake before the SARS Section12J cut-off in July 2021,” he proclaims.

Section12J investments have caught the eye of many South African investors, with government having had to do an about turn and limiting the amount permitted to be invested to R2.5m per annum. Section 12J of the Income Tax Act was introduced in 2009 to encourage South African taxpayers to invest in local companies and receive a 100% tax deduction of the value of their investment. The investor receives a share certificate together with a tax certificate, allowing the invested amount to be deducted from the investor’s taxable income, in the year that the investment is made. To date, South Africans have invested an estimated  R10 billion into the 12J sector.

The fund, which is managed by Section12J specialist investment firm Anuva Investments, holds assets in hotel apartment developments or ‘aparthotels’ located in Diep River, Foreshore, Rosebank and City Centre, Cape Town.