Multifamily residential rental properties are poised to become a cornerstone of South Africa’s institutional investment landscape. The inaugural research, commissioned by the South African Multifamily Residential Rental Association (SAMRRA), in collaboration with ABSA and Divercity Urban Property Group, provides a comprehensive analysis of residential property investments locally and globally.
The study, conducted by MSCI to uphold global standards, ensures direct comparability and benchmarking with 33 other markets under scrutiny. This quantitative analysis equips stakeholders with essential data to fuel capital influx into the burgeoning multifamily residential property sector in South Africa.
These properties, characterized by built-to-rent (BTR) housing units like apartment buildings and complexes, are predominantly owned by institutional investors and managed by specialized residential property operators.
SAMRRA’s CEO, Myles Kritzinger, underscores the significance of this research in building a credible knowledge base for local institutional investors. Eileen Andrew, Vice President of Client Coverage and Real Estate at MSCI, notes the growing importance of residential property investments globally, highlighting their stability and consistent performance.
Globally, residential real estate comprises a substantial portion of fixed capital, surpassing investable commercial real estate by a significant margin. The research attributes the growth of this asset class to its reliable performance and lower risk profile compared to other property sectors.
In South Africa, despite the multifamily residential sector’s nascent stage, its performance has been noteworthy. The report indicates higher and more stable returns from higher-quality residential properties, signaling attractiveness for institutional investors.
Carel Kleynhans, CEO of Divercity, emphasizes the value of well-developed residential portfolios amidst the country’s housing challenges. Amelia Dieperink, Head of CPF Affordable Housing at Absa, lauds the research’s contribution to understanding and shaping South Africa’s multifamily residential sector.
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By Proptechbuzz
By Ravi Kumar
