Realty Africa, a company that deals with funding of real estate investments, last week Thursday held a press briefing in Gaborone where they introduced one of their first local beneficiaries, Enoch Moalusi, who is the Managing Director of Rerothe Haven, a multi-residence in Mogoditshane owned by the Moalusi family.
Speaking at the event, founder and Chief Financial Officer Erik van Eeten said after travelling around different countries, they found that there were so many opportunities for creation and growth that exists, whose potential remain confined and un-noticed. He said they noticed a serious problem of liquidity in that money is scarce and not always accessible. Van Eeten said they found that access to funds was extremely challenging and when acquired was expensive. He said crowdfunding was established to address such financial stumbling block for property investors. He liked crowdfunding to a popular practice already practiced in Botswana and popularly known as ‘motshelo’ where people contribute money to help each other.
Realty Africa Country Director, Sethebe Manake said crowdfunding is meant to assist many people who have viable projects that do not fit into the mould created by traditional funding available in Botswana where true merit of a project is viable and the funding is either too steep or too rigid that it erodes the success of the project. She said her company gives clients options for either the investor who wants to have real estate exposure but not the complexities of running direct real estate or a developer who has a viable project and wants to achieve high levels of returns.
‘‘We have a solution that will breathe life to all of those dreams with approved plans and viable business plans that have been gathering dust hoping for a glimmer of light to give them life’’, Manake said. For his part, Moalusi said his family conceived the multi-residence project in 2013 but never took off as the market research for rental and sourcing of funds for development came back negative as the rental income could not meet the development loan repayments.
After many considerations, the family opted to sell some of the 17 units under sectional title to offset the development costs. With the help of Manake, they managed to secure buyers which guaranteed them anchor clients. He said several financiers only then embraced the project. They were however shattered when their financier reneged on the loan agreement and left them in the lurch. It was only in 2016 when Moalusi was contemplating giving up on the project that Manake approached her again and told him about Realty Africa and how they can assist him. ‘‘Crowdfunding is motshelo on steroids because it brings investors all over the world together to fund viable, meaningful and life change projects for minimal individual contributions’’, Moalusi said with elation.