CEO tells how he got his Golding moment
Dr Who? | GP had to hang up his stethoscope to get his finger on property pulse, writes Brendan Peacock
ANDREW Golding, chief executive of the Pam Golding property group, was once a Sea Point GP.
As life changes go, it probably does not come much bigger than stepping into your mother’s real estate business as managing director as the property market turns sour.
In the past 18 years, however, Golding has proved himself an astute business manager.
“I loved being a doctor. Medicine was and to some extent is my first love. I was fortunate to be with a partner who was very experienced and showed me the ropes. He’s still there. We had a fantastic practice, one of the oldest in the country at over a 100 years. It’s obviously very different from what I do now.”
Golding says he loved the “instant gratification” of seeing 25 people a day, and helping them within a few hours. Those days are gone, it seems.
“I don’t think practically I can go back, though I try to keep my 50 CPD points required to keep my licence going. I’ve been out of it for 18 years. Sentimentally, there’s something that says I’d like to be a GP in a little town somewhere, but that’s probably a romantic notion,” he says.
Golding says that when his brother, who was managing the business, decided to branch out with the commercial arm of Pam Golding Properties, all eyes turned to him one Sunday lunch in February 1995.
“They looked at me and said that if I was ever going to contemplate joining, now was the time to do it, or they’d have to find a professional business manager. I had always said the one thing I wouldn’t do is join the business, but I spoke to my wife — we had two small kids — and made an impulsive decision to give it a go.”
Golding at the time did not have much experience other than in the medical field.
“I knew vicariously bits and pieces of what went on from day to day, but I had no formal business training and in fact was thrown in the deep end in a fairly dramatic way.
“Soon after I joined, interest rates went to 25%, the phones stopped ringing. I suddenly learnt about the Labour Relations Act and had to retrench people who’d been in the business for 15 years. It was a tough time from 1996 to 1998,” he says.
In 1998, the pressure eased and the market began to turn.
From 2000 to 2007, it appeared as if nothing could go wrong in the property market.
“From my first days, the business has grown from 30 offices to 300.
“In terms of turnover, it’s probably the same order of magnitude.
“It also happened to coincide with a big acceleration in capital growth in houses so the turnover increased exponentially,” says Golding.
I had always said I wouldn’t join the business ... but made an impulsive decision to give it a go
With his sister not interested in real estate and his brother spun off into another division, it made the decision to appoint him easier.
“My mom began to slow down her involvement soon after I took over, taking on a more ambassadorial role than an executive one.
“She would say she’s never actually stepped out of the business, though she’s in her late 80s now.”
Golding’s experience in medicine helped prepare him to some extent.
“The thing that general practice prepared me for was dealing with people. However, the first shock for me was that when you have a stethoscope around your neck you come from a position of strength.
“When you’re an inexperienced business manager with no real-estate knowledge, and you try to tell an estate agent to do something, they generally won’t listen,” he said.
Golding had to find new strategies. Some worked and some did not, as you would expect with any entrepreneur.
“I looked at ways of growing and diversifying the business. Our involvement in [mortgage originator] Ooba was a completely new business genre. I initiated quite a few business units over time.
“The spread into Africa was something I spearheaded; the various initiatives in London; the sale of international property to South Africans, Mauritius and the Seychelles with specific components around opportunities for South Africans to diversify, particularly where residency was an issue.”
Other ventures were less successful.
For example, Pam Golding’s ill-fat- ed foray into fractional ownership. It was an experiment that Golding now describes as “painful”.
The company has since been trying to push rentals too.
“It’s more labour-intensive and potentially fraught with reputational risk, but over the years we’ve figured out ways of managing that risk. As a referral generator, it’s really important,” he says.
The basic principle of real estate has not changed since Golding got involved: you broker a property sale between a buyer and seller.
What has changed, however, is technology in the field.
“Before, digital estate agencies held and guarded all the information, and people used individual company websites to search.
“Now, information is freely available, and the portals are where people browse. Agents have had to adapt to focus on being skilled negotiators and to use technology to ensure a convenient and hassle-free transaction,” he says.
You might think that would endanger companies like Pam Golding, but he says that is not the case.
“The trust implicit in a relationship between seller and agent is a fundamental part of the business.
“While a lot of the browsing process can involve someone else at an agency, agents now need to interact with the suburbs or part-suburbs in which they specialise to develop and maintain trust with potential clients,” Golding says.
“You can use technology to streamline as much as possible, but you still need a specialist to negotiate a sale, conduct valuation and marketing.”
Golding still sees strong demand in the market. The banks are also still taking a positive view on lending, which is helping keep property affordable and the market oiled.
New big international estate agent franchises have opened up in South Africa too. While this has squeezed medium-sized agencies, it has still given the large and small agencies scope to compete.
And the benefit of these overseas companies is that they’ve broadened the market, and increased demand for South African properties overseas, leaving the market in pretty good shape.