Petro Heydenrych: CEO, IProp

Posted On Wednesday, 04 December 2002 10:01 Published by eProp Commercial Property News
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MONEYWEB: Welcome to Petro Heydenrych, the chief executive of Iprop –financial results out today for the year to end-September. But you can’t really read to much into these results, Petro, because the company has changed so in the past financial year. Just explain to us – at a board level what made you take the decision to sell off your portfolio and then to move more aggressively into property development?

 

Property-Housing-ResidentialPETRO HEYDENRYCH: Alec, initially, when we acquired the portfolio, our decision was to grow that portfolio. We could either do it by developing more properties or acquiring other portfolios. The way other portfolios were acquired was to lump our portfolio together with that of various other people, and do the new listing in iFour.

MONEYWEB: So what do you have left now?

PETRO HEYDENRYCH: We’ve got left a small property portfolio left, which didn’t fit the investment criteria for iFour, and we are focused on our main business of land development.

MONEYWEB: Perhaps you could give us a good feeling on how land development is going at the moment. One part of your result says that you had to write down undeveloped land in the East Rand by R1.7m. So clearly, in that area, things are not going too well.

PETRO HEYDENRYCH: Let’s address that one first. That’s property that we’ve had for quite a few years. The initial estimate of high development on the East Rand didn’t materialise, therefore we had to have a relook at those values.

MONEYWEB: Is this residential property or industrial?

PETRO HEYDENRYCH: It is industrial, with a potential that the use can be changed to residential. The rest of our core business, how we were formed in 1968, the market is quite active. I think people have had a new look at the area where we are. You get a lot of congestion on the roads to the north, and people have decided to look afresh at our area.

MONEYWEB: Where’s that?

PETRO HEYDENRYCH: We are operating primarily south of the M2 east/west.

MONEYWEB: The old RMP, Rand Mine Properties?

PETRO HEYDENRYCH: Correct. And, in our area, it’s people who come to live there, that want to be in the area, people that run their businesses from the area. They need to be there or they want to be there. There’s no fashionable angle to that land. It’s because people want to be there.

MONEYWEB: There’s been a lot of development around that over that area, the Mondeor, Crownwood, Robertsham. That’s pretty much where your properties are?

PETRO HEYDENRYCH: Yes, and that’s also where our offices are. We have previously talked about the Crown City Development – that is behind Edgardale at the Crown interchange. That’s been very active this year.

MONEYWEB: How big is that, Petro?

PETRO HEYDENRYCH: The total area is about 68 hectares. So that will take quite a long time to complete.

MONEYWEB: And, once it is completed, in rand terms, how big a development would it be?

PETRO HEYDENRYCH: That is very difficult to say, because in the period over which we develop, the property prices will hopefully increase quite a bit over that period. We are also busy with a residential development, which we hope to bring on the market by the middle of next year, which is adjacent to the Crown Mines golf course and overlooking the golf course.

MONEYWEB: How would that compare? If you can start at the development near the Crown Interchange with, say, Melrose Arch?

PETRO HEYDENRYCH: It is something completely different. We’ve got a mixed development – in other words, we can provide for offices, industrial, commercial. It’s driven by market forces and we’ve found that it’s in demand for industrial and distribution uses. And we’ve seen that quite a few cash ‘n carry operations have come and established themselves in the area.

MONEYWEB: So for shareholders in Iprop, why would they buy into your business?

PETRO HEYDENRYCH: it’s probably a belief in the property market that can meet the demand of property uses at this time.

MONEYWEB: And very much in the Southern suburbs of Johannesburg?

PETRO HEYDENRYCH: Yes, very much so.

MONEYWEB: Petro Heydenrych, chief executive, Iprop. A fascinating story.

Last modified on Saturday, 26 April 2014 15:43

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