Old Mutual to Offer Corporate Property Solutions

July 10 - While many corporations own one form of property or another for investment purposes in South Africa today, a significant proportion are not getting the most out of their properties and require guidance regarding the best type of solutions for their individual needs.

Old Mutual Investment Group Property Investments (OMIGPI) has recognized the demand for this type of service and has announced the launching of a special unit to provide property solutions to the corporate sector.

The executive who heads this new division, Sibongele Bapela, said: "Corporate South Africa has R600 billion in property assets. Our aim is to help business and government make the most of these assets. There is a corporate mindset that says owning property assets is the right way. But there are other options that can relieve pressure on balance sheets, align corporate strategy with best deployment of assets, ensure tenure of space and reduce risk associated with ownership."

With many businesses considering relocation for a wide number of reasons, Bapela says that there is need for corporations to realize that things are never as simple as they seem. "Businesses need to carefully consider all aspects on any proposed relocation and its impact on productivity," she said. "The division recently researched a relocation proposed by a people-intensive business from what it perceived to be an expensive office block to a more decentralized address. The research showed that the relocation would mean a loss of productivity through longer traveling times for most staff who would also be paying more to get to work."

Bapela did not rule out the offloading of property assets as a means to protect business interests. "For some businesses, this may mean offloading property assets to restructure balance sheets," she said. "For others, shrinking or closing a division, or changing business focus may mean a need for alternative space, or a development to suit the strategy and productivity requirements."