Balwin in push for online sales

Ever the optimist, Balwin Properties CEO Steve Brookes is undeterred by the coronavirus-induced doom and gloom gripping most sectors of the South African economy.

Despite the initial lockdown bringing the residential property market to a virtual halt, with restrictions on trade and the deeds office closed for five weeks (to the end of April), Brookes says Balwin is still securing sales within its developments countrywide.

“Through online sales, we signed around 200 deals in April,” he said. “While the Covid-19 lockdown has had an impact, it has not stopped our business. We moved online and are doing about 60% of the sales that we achieve during a normal month.”

Brookes, the founder of South Africa’s largest sectional-title developer, was speaking following the release of Balwin Properties’ full-year results to February 29, 2020, on Monday.

The group posted an 11% increase in revenue to R2.9 billion, compared with the prior financial year.

Despite local headwinds and the country going into a recession, Balwin sold 2 715 apartments within its developments countrywide, which was up by 278 units for the year.

SA’s poorer economic conditions, however, did eat into Balwin Properties’ operating profit, as the group invested more in marketing and increasing its staff complement to compete in the market. Operating profit for the year declined by 9%, from R630.1 million to R574 million.

Group financial director Jonathan Weltman pointed out that while expenses increased to R235.6 million, this was in line with market guidance. “This was largely as a result of the bolstering of staff at mid and top management level, as well as strategic marketing-related costs.”

Breaking sales records

Brookes says post year-end, the group has secured more than 800 newly-signed deals for its apartments, with 600 of these linked to the flagship new R9 billion Munyaka development.

“The launch of Munyaka in Waterfall resulted in Balwin breaking all sales records in March this year.

“We achieved over 807 sales for the month and around 600 were related to Munyaka, which will be home to the largest man-made lagoon in the southern hemisphere, featuring ‘Crystal Lagoons’ technology,” he added.

Moneyweb

About 150 employees at JSE-listed property and private memorial parks developer Calgro M3 Holdings have been retrenched, following a decision by the group to close its construction division.

These retrenched employees could not be absorbed by Calgro M3’s new outsourced contractors.

Calgro M3 has also decided to sell its entire residential rental portfolio and use the proceeds to settle debt.

In October last year, it valued this portfolio, comprising about 400 occupied rental units and a further 400 rental units it was then tenanting, at about R500 million.

Shares in Calgro M3 slumped by 51.25% to R3.90 a share on Monday, despite the group reporting a turnaround to profitability and a significant improvement in its cash generation and reserves in the year to end-February.