Levitt returns to real estate
Former Auction Alliance chief’s new property fund, Inospace, creates flexible business parks for small companies
Rael Levitt, who has not been seen in real estate since 2012 when he fought with one of the country’s wealthiest women, Wendy Appelbaum, has co-founded a new property fund called Inospace.
Rael Levitt, who has not been seen in the real estate sector since 2012 when he fought with one of the country’s wealthiest women, Wendy Appelbaum, has co-founded a new property fund called Inospace.
This is the first property venture he has been involved in since the company he headed, Auction Alliance, unravelled and was shut down in 2012 after Appelbaum, the owner and chair of De Morgenzon Wine Estate in Stellenbosch, accused him of bid rigging and using ghost-bidding tactics at an auction for Quoin Rock Winery and Manor Estate.
Levitt was not available for interviews on Wednesday.
The new firm, founded with former Investec banker Nicholas van Eeden, is trying to compete with office-owning real estate investment trusts, its management says.
Inospace converts buildings often located outside of Johannesburg and Cape Town’s premier business nodes into flexible office parks designed to appeal to small and medium enterprises. Its parks also include studios, storage and traditional warehouse space.
It has begun to attract companies that are downsizing in a weak economy and want to pay rentals at more flexible terms than traditional landlords would offer, according to Cape regional director and former city councillor for the Atlantic Seaboard, Jacques Webber.
Inospace is the latest property fund backed by Buffet Investments, which was founded by billionaire Jonathan Beare. The company may list within a few years when “economic conditions are stronger and political policy more stable”, Webber said.
Buffet has spent the past two years or so creating private property companies that have business models that differ from traditional large property funds. These firms focus on providing specialised tenant services, such as hot-desking and hybrid designs that include office and industrial space, according to Webber. Tenants can also rent space for a few months at a time at fixed rentals and are not locked into leases for years.
Inospace’s other main shareholder is KLT Holdings, a private fund that invests across real estate and is run by Brad Kark and Terence Lazard, with the financial underpin of Londonbased Tony Tabaznik. Inospace acquired seven industrial parks in Cape Town and Johannesburg for R212m in November. It now owns more than 20 parks.
Webber said Inospace had ambitions to grow rapidly so that its offering could be of the kind of high quality JSE-listed German Sirius Real Estate and UK-based Stenprop brought to tenants in Europe.
Inospace made its first foray into SA business parks when it acquired a site in Epping Industria in Cape Town and shortly thereafter launched the Powder Mill in Ndabeni further north.