Redefine / Spearhead Merger Will Result in New Group Leasing and Development Divisions.

Posted On Wednesday, 22 November 2006 02:00 Published by eProp Commercial Property News
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The Supreme Court on Friday 17th November sanctioned the Redefine Income Fund / Spearhead Property Holdings merger for which an overwhelming majority of the shareholders in both groups had already given their approval.  The merger is therefore now a fait accompli and Spearhead will delist from the JSE within the next week.

Mike FlaxMike Flax, CEO of Spearhead and now Executive Director of the Redefine asset manager, Madison Property Fund Managers, said that as from 20 November 2006, the Spearhead Cape Town offices had become the Cape Town offices of Madison and he and his team will be playing significant roles in the enlarged Madison stable. 

“We will,” he said, “be structuring two new operations. “The first will involve the setting up of a new consolidated leasing operation for the whole Madison stable of funds including Apex-Hi, Redefine and Hyprop.  We will be responsible for achieving satisfactory leasing figures not only in the group’s existing vacancies but also for the 300 000m2 under construction of commercial, retail and industrial space in all new developments that will come on stream.”

These, said Flax, are likely to add some 10% to the current portfolio’s available space annually because, as will become evident, Redefine intends to step-up its development activities. Currently, said Flax, vacancy levels in Madison funds vary from a very satisfactory below 2% in Hyprop Investments to a rather larger 9% in Apex Hi Properties.

But, he added, Apex-Hi has already improved from an even higher vacancy level and, being exposed to a range of CBD properties, can now expect an upswing because in his opinion Johannesburg, Pretoria and Durban CBD values currently offer among the best property in SA and, with upgradings and diversifications, Apex-Hi is likely to see real growth this year.

“Throughout SA the CBD’s are undergoing a revival,” said Flax. A-grade office space in Cape Town, he added, will by the end of 2007 be reaching R120 / m2 and increases of 30% can be expected in B- and C-grade space as demand here is very definitely on the increase.

Former Spearhead Chief Operations Officer, Darren Wilder, will head up and structure the new Madison leasing team to which he will be introducing a number of former Spearhead staff.  In the process, said Flax, he will be ‘mirroring’ the CT operations in JHB and Durban.

“The strength of the Spearhead leasing operation,” said Flax, “has always been based on the service it gives to and the relationships it has with brokers.  Now that we have such large resources it will be possible in Cape Town, Johannesburg and Durban to develop further the broker service, with specialist consultants for specialist brokers and specialist fields operations and with a top-class Broker On-Line Search Engine.”

In all major centres, said Flax, importance will be placed on fast tenant installations.  Former Spearhead and other construction managers will, he said, liaise with clients to speed up, simplify and reduce the costs of the move-in process, thereby getting rental returns quicker and adding to the group’s fee income.

The second big task facing Flax and other former Spearhead staff will be to take full control countrywide (and later beyond SA’s borders) of the group’s development and redevelopment programme which, Flax has already said, could have a budget of in excess of R1 billion per annum. In Cape Town this operation will be managed by Development Managers Anthony Wolpert and Lance Hoffman and supported by  Project Managers Daryl Sher and Arthur Barry who held similar positions at Spearhead.

In Gauteng, Flax is now actively recruiting a team of executives to head up the day to day planning and running of developments. Flax said that the Spearhead team had been made to feel welcome in all the Madison Companies and, he said, it is widely recognised that the new dispensation creates a win-win situation for everyone involved.

Last modified on Monday, 28 April 2014 12:11

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