Real Estate Investor Magazine South Africa September 2014 | Page 51

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of the building; popularity of the premises and tenant
waiting lists; and the time it takes the landlord for
tenant installation.
Tenant mix
“Tenant mix is a further important aspect as it is
essential that a building generates a viable cash
flow. Management agents such as JHI have years of
experience and research on how to compile the correct
tenant composition for a specific building area and
industry type. The right tenant mix also ensures the
sustainability of the premises.”
National and anchor tenants are very important to
ensure a stable long-term rental income, and also have
an influence on the rest of the tenant mix. National
tenants are those that occupy space in excess of
2000sqm and sign long-term leases. Anchor tenants,
such as department stores, are large stores that rent
space in a mall or shopping centre. An anchor tenant
naturally has the ability to attract more people to
the mall than the other tenants, and because it rents
more space, it will generate more of the mall’s revenue.
Agreements with anchor tenants must be in place
before most banks will finance the construction of a
mall or shopping centre.
As the Occupational Health & Safety Act regulates
tenant and customer safety in buildings and needs to be
complied with to ensure the property owner’s insurance
stipulations are met, this is an important priority for
landlords and property management. Covering aspects
such as fire hydrants, fire extinguishers, emergency
exits, sprinkler systems and building structures, the Act
is enforced and inspected by the City Council.

some signs of improvement; nevertheless, it remains
difficult to get a development off the ground due to
several factors. These include delays in municipal
provision of services as well as challenges in accessing
development finance. This places the emphasis on
revamping existing premises to attract new tenants
and retain anchor tenants. JHI has a project and
development department that specialises in assisting
landlords with suggestions and plans for such projects.”
Technology also plays a larger role in managing
property, especially when it comes to security, which
has become a priority and a major expense. “This
resource must be managed carefully, so as a company
we utilise operational managers to ensure that
surveillance cameras and security guards are optimised.
Security and security management are also a major
focus when negotiating with new tenants. Increasingly,
CCTV cameras are utilised to secure and monitor
premises, providing an important defence mechanism
in assisting law enforcement agencies to fight crime.”
Adds Swanepoel: “When vetting a new prospective
tenant we make use of IT technology though credit
bureaus and other electronic aids to determine
a tenant risk rating. This rating is used
to determine the amount of surety
and deposit needed to protect the
landlord’s risk.”

RESOURCES
JHI Properties

Trends and technology
Swanepoel says previously, the trend was to build
new premises to cater for changing requirements,
however, the current economic climate and
municipal governance issues are slowing
this sector. “The construction sector
has been through tough times with

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September 2014 SA Real Estate Investor

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