Flyt Hospitality Fund launched for 12J investors

Anuva Investments, SA’s first Section 12J company, has launched a new property/ hospitality fund. It allows for diversification from traditional 12J private equity into the property sector via a hospitality fund created in partnership with Capebased property developer Flyt Property Investment.

Anuva Investments founder and CEO Neill Hobbs says the company’s investment mandate with Flyt Property Investment is focused on quality hospitality. “Our strategy is to find outstanding opportunities in the sector: good-quality, strategically located properties with a focus on sectional title serviced apartments and student accommodation.”

Property was excluded as an asset class for 12J investing until recently, when a few venture capital company (VCC) specialists included the hospitality sector in qualifying VCCs. Investment in venture capital vehicles of this nature has boomed over the past 24 months because of its tax incentives. Section 12J provides local taxpayers with a 100% deduction on the invested amount, so they can claim tax relief of up to 45% on the investment amount.

The partnership will issue shares in selected qualifying property developments. Two Cape Town developments have been structured into the fund. The issued shares give the holder access to all benefits of the property. A minimum R1m investment is required from private investors, trusts, stokvels, investment syndicates or companies. The investment is locked for five years.

Eaton Square in Deep River, Cape Town, will be available to Section 12J investors via the Flyt Hospitality Fund. The project is due for completion by January 2020.