Viruly Consulting

The Property Investment data bank ( IPD ) has released the returns for the South African property Sector in 2011. It shows that total returns have declined to 10.5%, compared to the the 13.3% rcorded in 2010. The industrial sector continues to outperform  the market with a return of 11.9%. What is possibly of greater importance is that the difference in returns between the sectors has become marginal with the industrial , office and retail sectors recording .11,9%, 11.2% and 10.1% respectively. For the asset manager it  means that greater focus needs to  be placed on the effective management of properties. The outperforming asset manager will not so much be the one that chooses the right sector but rather the one that identifies the correct properties and "sweats" these assets themost effciciently . According  to the IPD, operating costs increased by 17% in 2011 , whcih is well above the inflation rate of some 5% in 2011.   It is becoming clear that containing the rise in operating costs  will remain the most important issue for the sector in the years to come.