SUREN NAIDOO: With June being Youth Month, in this episode we are speaking to Monedi Lefakane, the co-founder and current chairperson of the Youth in Property Association. The organisation, or Yipa, as it is also called, promotes youth entering South Africa’s property sector. It’s quite a youthful body, being only a few years old and run virtually entirely by young people. One of them is Monedi Lefakane.
Hi Monedi, welcome to The Property Pod.
MONEDI LEFAKANE: Thank you very much for having me … It’s nice to be out here.
SUREN NAIDOO: Let’s get into it, Monedi. Yipa was established a few years ago. Give us a little bit more detail on the organisation and why it was set up.
MONEDI LEFAKANE: We were established originally in 2017, although the idea for Yipa really came about in 2016. I was studying a BSc Engineering and Property Studies at UCT at the time. One of the issues that I saw was that, in my class of 30 to 40 individuals, the majority of the students were white and students from families that were already established within the property sector. You had people who came from families that were developers, property developers, architects, engineers. But the few – probably seven or eight – black people who were there had no direct relationship to the property sector.
What that meant was when it was time for internships, vacation work, a lot of the black people weren’t getting access to those opportunities, whereas the white students, our white counterparts were getting them very easily.
So I thought to myself, let me create an organisation. I called five friends who were studying property-related degrees at the time. We said: “Let’s come together and create an organisation which could help us bridge the gap between students at university and the private sector, which is particularly focused on giving young black people access and opportunity.”
We launched officially in 2017. We had a very successful launch we were quite proud of. [We had] the deputy minister of public works at the time, Jeremy Cronin; we had Nedbank’s [former] corporate property finance head there, Robin Lockhart-Ross and other individuals. It really helped us to establish ourselves and put our name out there, which was very good and something we’re very proud of.
We’ve been able over time, I think, to analyse the issues that are out there that are barriers to transformation in the property sector, and have formed ourselves around three core initiatives, being employment, education, and our longer-term initiative of entrepreneurship.
SUREN NAIDOO: That’s really exciting and it’s quite impressive that you took the initiative. You don’t have any links to other organisations. It was all a firestarter on its own.
MONEDI LEFAKANE: Yes, when we started it was really ourselves standing on our own. We weren’t kind of having a mother body or a subsidiary of a large organisation. Today there are definitely one or two youth organisations that have a mother body, but when we started initially we were all on our own.
Over time we’ve been able to get a lot of support from the private sector, government, other associations and organisations out there in the property sector who realised that we were youth and we definitely needed some assistance, whether from a strategic perspective or whether from a financial perspective.
Liberty Two Degrees was definitely one of the organisations, and particularly Amelia Beattie, who’s the CEO, has really held our hand, ensuring that we have almost a blank cheque to financial support at Liberty Two Degrees. But at the same time from a strategic perspective, because she was Sapoa [South African Property Owners Association] president [at the time]. She understands how to almost build and run an organisation in ensuring that from a governance perspective it’s run well, particularly in a non-profit [entity] in the context of South Africa.
Yes, we’ve had a lot of strategic support and been able to build affiliations and partnerships over time with organisations like Sapoa, with organisations like the Property Sector Charter Council [and] SA Reit Association.
SUREN NAIDOO: We’ve kind of run a bit on to some of my other questions, but where does the organisation stand at the moment? What do you offer young people, black youngsters who want to get into the property industry? What differentiates Yipa from the likes of Sapoa and others which have a broader mandate, but also offer things like bursaries and that sort of thing.
MONEDI LEFAKANE: I think over time we’ve been able to craft a niche area for ourselves. You mentioned Sapoa and its bursaries. It’s a fantastic programme, but something that we’ve come to realise is Sapoa has a lot of funding for bursaries but is not able to distribute them. We’ve taken the time to say, what is in this chain of a young person entering the sector? Where are the gaps, where are the barriers to them entering it? You can have a bursary for university students to study property studies, but not have initiatives focused on ensuring that children in high schools know about property as a degree or as a career opportunity.
That’s where we’ve tried to fill the gap – at least from a Stage 1 perspective; it’s saying let’s run a job-shadow programme, which we do, and we’ve been able to partner with a number of different organisations in the private sector. And we give young people an opportunity to shadow and understand that property is definitely a career option and somewhere where you can build a long-lasting career for yourself.
The second element that we looked at was from a university perspective, saying, all right, as an individual in university you’re studying but you want to get an internship. How do you find that internship? Again, through our relationships, we’ve been able to provide those. And then for someone who’s working and has graduated from university, we’ve been able to provide opportunities to get tickets to conferences like the Sapoa Conference, like the SA Reit Association. We get them at a discounted rate and distribute them free of charge to our members. But we additionally host educational events for young people, to hear from people that you don’t normally hear from on a daily basis. So whether that’s Sindi Mabaso Koyana, or Amelia Beattie, or Sisa Ngebulana, whether it’s hosting a workshop with social housing organisations – or a variety of aspects where you could learn educationally.
SUREN NAIDOO: It’s quite an extensive programme you have there. You mentioned Liberty Two Degrees, but from whom else are you getting backing financially as a public benefit organisation? You have your events and other avenues of income but, besides Liberty Two Degrees, what other avenues are you looking for? Do you have a membership, for example?
MONEDI LEFAKANE: We do have a membership. Membership in our association is free. One of the challenges that we identified from the beginning in the property sector is that cost capital for a young person is something we want to alleviate or help reduce the burden. So, we don’t charge a membership fee at our organisation and we generally don’t charge even for events or anything like that additional support, other than from Liberty Two Degrees.
We find that, on an ad hoc basis, if for example we need sponsorship for T-shirts or something like that, we’ll definitely approach, and we have in the past, organisations like Anchor Stockbrokers, organisations like Delta Property Fund, and sometimes even the National Department of Public Works for funding support.
SUREN NAIDOO: You talked about access to the property industry. Maybe you want to zone in on some of the issues – both challenges and opportunities – for you to get into the property industry, because the property industry is quite substantial. But it’s also quite broad. You have the listed, you have the residential – all the various sectors that the youth can get involved in as a career opportunity.
MONEDI LEFAKANE: Yes. I think of some of the opportunities out there right now. I was thinking to myself that Covid has brought a number of opportunities in the property sector because of the need for us to think differently about how we develop property; how we’re configuring the space and our property. Ster-Kinekor, for example, is going into business rescue. They may shut down certain cinemas and that requires certain malls to reconfigure that space – and that creates opportunity for people. So I think Covid has brought definite opportunities from that perspective in terms of just thinking about how you develop property.
But we’re finding a lot of listed-property companies having to dispose of assets because of their high loan-to-value ratios, and needing to improve their balance sheets. That again brings opportunities for a young person to approach a listed company and say: “I know you’re disposing. Can we think of innovative ways within which you could dispose to someone like myself, who doesn’t have all the capital from an equity perspective that’s required, but could maybe pull together some senior debt and some mezzanine – and potentially you’re looking at vendor-financing someone like myself.”
Those are some of the opportunities that definitely come in a scenario of the challenge of Covid-19. But I would really say that I think for young people just generally, the issues that they face now are really, I think from a relationship perspective, the property sector is based on relationships. If you just look at its history and how Growthpoint … and some of the big listed Reits were established – they really kind of came from Investec originally, and those relationships were formed there. So, it requires a young person to build those relationships, which takes a lot of time.
Speaking of time, an additional challenge would be experience. You can have capital as a young person to buy a property, but the challenge of experience is in terms of analysing whether this is a good deal, how do I fund it in a way that’s going to be optimal for my return? How do I find the best tenant to occupy the space and ensure I sign a good lease with them? Those are all challenges that you can only solve if you have a level of experience in the sector.
Capital is as well a third and big issue for a lot of people, not just young people in the sector.
Those are some of the challenges that we face out there which require innovative thinking for you to solve.
SUREN NAIDOO: There are a myriad of challenges. We’ve reported on some of them. Just to pick up, you talked about youth getting into property … Recently, we reported about Balwin Property; a component of the BEE deal they say will include youth. So, there’s an opportunity. You mentioned Investec. I see beside the UCT qualification, you have been involved with Investec.
As a parting shot before we go, give us a little bit of background about yourself and maybe some of the other people that are involved with the Youth in Property Association.
MONEDI LEFAKANE: Sure. I do want to touch on Balwin. Deals like those empowerment deals, by the time you see them in the paper they are already completed and done. That again highlights the need for relationships, because you would have needed to know three or four months ago had you wanted to participate in something like that as a young person.
As for my own background, I studied a BSc Engineering and Property Studies at UCT, and from there spent some time at Investec Asset Management – now Ninety One – as a listed-property analyst. That was probably the best way for me to enter the sector because it gave me a top-down approach in terms of understanding the sector generally from a listed perspective, from a financial perspective, and from a strategic-thinking perspective in terms of the companies.
From there I left and moved back to Johannesburg and focused on creating a broad-based youth-empowerment company in partnership with the Cyril Ramaphosa Foundation. The aim there is really to target equity stakes within untransformed property companies specifically; and acquire those. That’s really my history. I do that alongside spending time as an analyst and assisting the Encha Group in building up a new property portfolio. That is my history as a whole.
From the perspective of the broader team, we have an exco, made up of again a grouping of five individuals. Some of the original founders have gone out to spread their wings, some are studying at the University of Cambridge and other places, but the team that’s here today comprises young people who are valuers, young people who are leveraged finance transactors at RMB – really smart capable individuals who are passionate about seeing the sector transform, but who also want a foot in the door and see Yipa is the best place to do that.
SUREN NAIDOO: Thank you so much, Monedi. Time has run out, but I look forward to hearing some of the future deals – not just from yourself, but from other participants in the Youth in Property Association. That was Monedi Lefakane, chairperson of the Youth in Property Association and future CEO of a major property company.