Apex targets smaller businesses
Pauline Dikuelo | Monday October 5, 2015 10:35
Apex Properties, the company managing the property, said they have availed the smaller office space of between 25 to 37 square metres for sale, as they want to instil the culture of ownership in entrepreneurs.
In an interview with Business Monitor, Time Projects director of commercial development, Brett Marlin said that they decided to venture into this strategy after realising that they have been neglecting the SME sector.
“Historically, we have catered for the middle-income and lower-end when it comes to residential property while our commercial market targeted only the upper-side of the market, which is normally big businesses,” Marlin said.
“We saw that there was a market for smaller businesses that could not afford to buy a 100 or 150 square metre or even rent that size of an office because it is not affordable,” he said.
‘The Office’ building was developed by Time Projects and opened for business two years ago.
Currently the two-storey building, which has 88 offices, has an occupancy rate of 95 percent in which 67 percent of the offices have been sold while the remaining 28 percent are rented.
Marlin added that this cultivated their efforts to come up with a strategy that can cater for SMEs.
“Our office spaces are affordable as they come with amenities, which include a gym, meeting rooms, boardrooms, which are for free, in-house cafeteria, stationary shop, a shared reception, which comes with the receptionist, backup generator as well as 24 hour-security,” he said.
Recently, Apex Properties held an open day at the building, which was attended by potential clients and financial institutions in order to sensitise the public about the advantages of investing in commercial property.
One of the participants, Amos Chakandinakira, head of commercial property finance at First National Bank (FNB) said that they decided to participate in this open day to meet clients and sensitise them about the opportunities that banks can offer.
He noted that there are some requirements needed for them to finance an SME to buy property, adding that their loan ranges from a minimum of P500,000 to an unlimited maximum.
“We look at the financials, cash-flow projections if it is a start-up. We look at the liability of the businesses and how they operate. Mostly affordability comes first as we look if the business qualifies,” he said.
According to Chakandinakira, they can only finance start-up companies, which are owned by a group that has another business operating on the side. He added that at times, the bank could take a risk where a company will have to pay deposit so that they can go in at a lower rate.
For his part, Obakeng Mpete of Bank Gaborone said that SMEs could apply for commercial loan or mortgage bond to purchase the property.
He added that for the business to qualify for a loan it needs to have been trading for some time and have a balance sheet that they can use for screening.
“As a commercial, we can finance you 75 percent of the open market value, so if the open market value is greater than P650,000 we can finance you that,” said Mpete.