Property Development Franchise. Your own Property Development Business. Countrywide.

Asking Price

R500,000

Monthly Profit

R169,063

Asset Value

R 500,000

Stock Value

R 0

Yearly Net Profit

R 2,028,754

Summary

The Franchisor operates as a Property Developer in the GAP market with blueprints for developing residential units which include solar and heat pump/ batteries for uninterrupted energy supply. Developments include a unique renewable energy combination based on the Franchisor\'s European experience in sustainable energy. The objective is to provide this concept, and all the supporting processes, to fifty franchisees across the country. The figures shown are projections for the end of a 12 month period leading into year two.

Give me more information

How long has the business been established?

The Franchisor operates as a property developer in the GAP market with blueprints for developing residential units which include solar and heat pump/ batteries for uninterrupted energy supply. It includes a unique renewable energy combination based on the Franchisor's European experience in sustainable energy. The objective is to provide this concept, and all the supporting processes, to fifty franchisees across the country. It is an initiative to stimulate the SA economy and empower entrepreneurs to assist with the housing backlog in SA. A collective approach to assist with the housing demand nationwide, based on maximum standardization. If you own a pocket of land already which can be developed this will be very beneficial. The Franchisor will however assist with identifying suitable land with the Franchisor and assist in the application of finance through its finance partners. The figures shown in this Report are projections after a 12 month period and moving into year two.

How long has the owner had the business?

The Franchisor started the business because of an MOU between the Netherlands and South Africa. The Franchisor started purchasing land in various parts of SA and started development in 2015. The Company has operational since 2008 - 17 years.

What is the Franchise opportunity about?

The Franchisor currently has a pilot development in Protea Glen under construction. This development is partially occupied, there are 2 x blocks of apartments of about 80 units. Block A has been completely sold out (56 units occupied) Block B has also been sold out (but not fully occupied as yet) and Block C, which is still under construction, has been sold out off-plan.
The head office is in Johannesburg and is fully functional as a back office for the first ten franchisees. We are in the roll-out phase, with an established team consisting of: MD, CFO, Office Manager, Internal Sales Coordinator, Technical Manager, and Brand Manager & PR.

How are the clients attracted to the business?

The Franchisor has partnered with Remax for the sale of units - both off-plan as well as completed units. This allows the Franchisee to concentrate on the development rather than getting bogged down in the paperwork of sales.

What Advertising/Marketing is carried out?

The Franchisor currently uses a website, email, and WhatsApp. The existing franchisees have been sourced from individuals with suitable networks. YouTube exposure and exposure on Business Day TV and Home Channel TV has worked well. Success was achieved at the Reside Summit in 2020. LinkedIn has performed well for them, and they have a newsletter.
Network follow-ups and site visits with interested parties are important. Key networkers in various provinces present the concept to business groups and construction networks.

What competition exists?

There is no competition in the market for this Franchise concept.

How is income derived?

Income is derived by way of sales of units in developments. The Franchisor has partnered with Remax in this respect.

Does the Head Office assist in securing contracts (if applicable) or is it up to the individual franchisee's to do this?

The Head Office assists in securing finance for both land purchase and development costs. The Head Office also operates a back office with an established team consisting of an MD, CFO, Office Manager, Internal Sales Coordinator, Technical Manager, and Brand Manager & PR.

Is the business VAT Registered?

Yes, the Franchisor is VAT registered.

How could the profitability of the business be improved?

The number of projects per Franchisee will increase and more opportunities might arise in other SADEC countries as well. The intention is that the Franchisee runs his or her own property development business with the support of the Head Office.

What is the total staff complement?

The Franchisee will at the beginning be the sole staff member of his business with the support of the back office situated at the Head Office. As the business grows development managers and other staff members may be brought on board. The Franchisor will advise the Franchisee on this.

How involved is the Owner in running the business?

The Franchisee will be involved on a daily basis as the developments progress and it needs his or her input. It will be less time needed in the 1st few months to 12 months - and then becoming a full-time task.

When does the current lease end?

No need for a lease. The Franchisor will run the back office as needed. The Franchisee will be able to operate virtually initially with maybe a site office at the developments.

What are the trading hours?

Monday to Friday: 8.00 am to 5.00 pm.

What are the main assets of the business?

The Franchisor is selling the Intellectual Property to the Franchisee with a back office back-up.

Strengths?

Established proof of concept with a fully functional corporate body.
Strong nationwide partnerships.
A new and fresh concept for a dire national housing crisis in South Africa.
Pilot development sales show the need for this concept to grow it country wide.

Weaknesses?

Normal hurdles of a growing business.
New concept in an existing but growing market.

Opportunities?

Expanding network.
The national focus of government is on infrastructure development and employment creation.
Opportunities for women in construction.
Lots of land available.

Threats?

Government policy changes - but government needs housing - so unlikely to change.
Interest rates and unforeseen delays with land acquisition - this is normal in any Western economy including South Africa. Head Office assistance is helpful here.

What is the reason for the sale?

The objective is to grow a national network of Franchisees who become developers of property and own their own Development Company.

Why is this a good business?

This is an opportunity for small role players in the often demanding development industry to escalate to high density and or renewable energy developments. The ROI is lucrative, and franchisees will benefit from multiple developments in various stages. Long term wealth creation.