Databank helps curb oversupply.

Posted On Thursday, 06 February 2003 02:00 Published by
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SCARCITY of information in the commercial property industry could soon be a thing of the past following the launch of a local branch of the UK-based Investment Property Databank.

SCARCITY of information in the commercial property industry could soon be a thing of the past following the launch of a local branch of the UK-based Investment Property Databank.

A lack of information is largely responsible for inefficiencies in the local commercial property industry. This has kept many potential property investors out.

Analysts believe that with a comprehensive data feed, the commercial property market becomes less vulnerable to oversupply, which is devastating key office property sectors across the country.

'Like other advanced investment asset classes, property needs a benchmark,' says property economist Francois Viruly.

The data bank, which has branches in 13 other countries, last week launched a wholly owned local subsidiary called Investment Property Databank SA.

The bank specialises in the collection of data relevant to making property investment decisions.

It has been used on a contract basis by the SA Property Information Exchange to produce an annual national index called the Sapix/IPD Index.

Sapix was established by 10 major local property owners in 1997.

The establishment of Investment Property Databank SA and its decision to continue with the compilation of an annual national index for the property investment sector signifies a major step forward for investors in commercial property in this country, says MD Stan Garrun.

The Sapix/IPD Index figures are drawn from major institutional and listed property owners representing about 65% of the local market.

'This lends credibility to our index and makes it possible to compare investment in property to other asset classes in an objective way.'

The Sapix/IPD provides property total returns in a given year which can be compared to other investment asset classes such as equities, bonds and cash.

Garrun says the establishment of Investment Property Databank SA gives the local market access to international best practice. 'We are now part of IPD Holdings' worldwide network consisting of 13 countries. We use the same methodologies and technologies and benefit from the international expertise that is used to analyse the investment property market in, for example, the UK, France and Canada.'

Services offered include portfolio analysis on property investment funds, training, seminars, and a quarterly operating costs benchmarking service.

Publisher: Business Day
Source: Sibonelo Radebe

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