With August being Women’s Month, The Property Pod is profiling leading women in South Africa’s commercial property industry.
In this episode I have the pleasure of speaking to Ipeleng Mkhari, founder and CEO of Motseng Investment Holdings. She is a mover and shaker in the industry, and has made her mark both through her own company, as well as leadership positions in the sector.
Motseng’s history goes back more than 20 years. In 2002 Mkhari secured an empowerment deal with Marriott Corporate Property Services in a joint 50:50 venture for a property management company.
Mkhari has thus played a pioneering role in the early transformation of the commercial property sector and is also a former president of the South Africa Property Owners Association (Sapoa).
Besides being a former president and board member of Sapoa, she was among the first black women to be on the board of a JSE-listed property company, when she was a non-executive director at SA Corporate Real Estate Limited (now SA Corporate Property Fund) in the mid-2000s.
Highlights of this special Women’s Month podcast in which Mkhari shares her story appear below.
You can also listen to the full podcast above or download it from iono, Spotify or Apple Podcasts. Alternatively you can watch the video here or on the Moneyweb Youtube channel.
“Motseng has really vertically integrated into three key verticals. Outside of property, we have an infrastructure business that is called Motseng Concessions, very much allied to property because, when you think of the infrastructure space that we’ve been in, it’s really public-private partnerships developing these large assets that government requires, and looking at long-term project-finance projects. So that is the one space we’ve gone into.”
“The second, which is also quite linked to property, is the acquisition of a company called Selmec in 2012. Round about the same time that we listed our property fund, we acquired a business called Selmec. We converted the name to become Motseng Selmec and that’s a business in the telecommunications space, which really looks at managed services for the mobile network operators – not just in South Africa, but also outside the country in Mozambique and Lesotho …
“More recently, we have been very excited by our entrance into what we call ‘smart building solutions,’ which is I suppose still property-related … Last year we acquired a business called Mott MacDonald Africa, which was the most recent acquisition in our business, and which we’ve renamed MPAMOT, which is also a services business, but mostly in the engineering and infrastructure space; also touching on property.”
Motseng’s deal with Marriott, at the time (2002), was one of the biggest empowerment deals.
“We started [Motseng] in 1998 and our first transaction just before Marriott was the Enforce (Security) transaction. We acquired equity into the Enforce security business. I think that catapulted us to the KZN investor base because after that … in 2002, we then concluded the Marriott transaction.”
“I think what was quite exciting at the time  was that David Green and Craig Ewin were looking for a BEE partnership where they could essentially start a new company from scratch called Motseng Marriott Property Services. So it was a 50:50 joint venture focusing on their asset base where clients were really pushing transformation as a requirement.”
“It was one of the largest BEE transactions … Because at that time there were very few other black-owned property management outfits in the country. In fact, if I recall, I think there was one other established party, and that was Dijalo Property Services.”
“In the last 23 years, we have shifted the business fundamentally from purely a property management focus …
“We very quickly, after getting into property management, diversified into facilities management. That was a natural organic kind of move. And then we got into this concessions infrastructure-management space, where we developed probably the largest accommodation PPP [public-private partnership] in this country, some 100 000 square metres of building under roof, which we still today are owners in and manage in terms of our facilities-management business.”
“Property management or property per se has grown within Motseng. We continue to be a very strong and leading facilities-management provider. But property management as a discipline – maybe less than 10% of our work is pure property management, even maybe less than that …
“Today we own properties, so we’ve become a landlord of our own. We obviously listed a portfolio called Delta [Property Fund], but the company was not invested at Delta. Delta really became an arm that was listed outside of Motseng.
“Post the Delta listing we focused on corporate-backed leases with, say, lease-back transactions with OEMs [original equipment manufacturers] and the like – and really that’s where our focus is today from a property standpoint.”
“We manage some very large recognisable assets nationally on the facility side.”
“I think … that the quality of earnings within property management to my mind, from our experience as recently as 2019, when we did probably our last property-management contract, is far surpassed by the facilities-management operation.”
“I suppose the market dictates where you go in many respects, and we have also had the benefit of creating our own opportunities and will continue to do that. I think it’s very important, as an independent operator, to be able to create your own funnel of work, so to speak.”
How big is Motseng Investment Holdings, considering all the different units, and how many people does it employ?
“The number has vacillated; probably the largest we were ever in terms of employment numbers was 600. And today I would say as a business on its own, as MIH without our other associated businesses, we probably sit at about 300 numbers. And if we consolidate the numbers between our recent acquisition of MPAMOT, we are certainly over 400.”
“We are a boutique, almost, property and investment business. We don’t invest in anything that is really outside of the value chain of property.”
“We love the fact that telecoms and energy assets still in our mind have a very strong property portfolio – or property profile, put it that way. There’s still a strong revenue stream in a telco asset. There is still a strong revenue stream in a project-finance asset.”
“I think the other element, when you talk of size within Motseng, is that our asset base at the last count in terms of assets under management is probably just under R20 billion. So it has also come down with some of our projects we’ve possibly handed back over to clients when the contracts have ended.”
How was it in the beginning, being a woman coming into the industry – not just a woman, but a black woman making some really big moves, especially from the transformation side?
“I think that’s an important question, especially now in Women’s Month. It was tough. It wasn’t easy. In the early days, one was Ipeleng Moloto, a very, very unknown individual.
“I found it tough but, at the same time, because I suppose there was a lot of policy support, and in those days anything between the late ’90s and mid-2000s, the economy and policy convergence and the support was really strong.
“I think that that combination allowed for entrepreneurs like myself to thrive, to be creative, to build businesses, to dream a bit bigger.”
What would you say has been the highlight in your career?
“Two very key roles have been very important to me in my career, and I think there’ve been many, many stellar moments. But I have had the benefit and have worked very hard in two specific organisations: Women’s Property Network [WPN], as well as Sapoa.
“If I look at this 23-year journey at a personal level and at a career level in terms of the whole business, those have been phenomenal highlights for me personally, leading WPN in 2007 and then Sapoa in 2018/19.”
“It has been about being able to establish oneself as a business leader in an industry that’s quite cliquey, quite small, but very impactful and a massive contributor to the GDP of our country. That takes a lot of grit, a lot of hard work, a lot of relationship-building, a lot of delivery, a lot of mistakes as well.”
“When I started, there were very few black women … In 1998 you would walk into meetings and they were practically nobody. Today I’m very proud of the fact that I think that, together with many other women, we have demonstrated and allowed many other women to enter the industry and not to feel afraid, because they’ve seen other women getting into the senior ranks.”
“That has been my career journey. It’s making sure that we really, really begin to transform just the representation within our industry, particularly the gender representivity.”
“WPN recently, together with Anchor [Stockbrokers] and Growthpoint, did a nice research report on the state of gender equality in our industry.”