The South African Multifamily Residential Rental Association (SAMRRA) has officially launched with thirteen members representing more than R40 billion in property assets and over 75 000 residential rental units across the country.
Multifamily residential properties are housing units built for rent, not for sale. These commonly include apartment buildings and multiple housing units within a single complex or estate. Often, institutional investors own these large-scale rental properties which are managed by professional and specialist residential property operators.
The asset class is characterised by consistent long-term income for investors, and it is a well-established, sought-after investment in many developed markets including the US, UK, and Europe.
Institutional investment in South Africa’s multifamily housing is, however, still relatively small, representing around 2% of the property market.
This is set to change. The South African multifamily residential property sector is well positioned to grow enormously over the next decade and beyond. It has already demonstrated stability and low risk in the SA market by largely outperforming other property subsets during the COVID-19 pandemic.
“There is a mounting demand for quality, affordable housing in South Africa that provides safety and amenity, seldom offered by residential developments in the past. Demand is accelerating with rapid urbanisation, a growing middle class, affordability constraints, decreasing household sizes and a shortage of housing supply,” says SAMRRA’s founding CEO, Myles Kritzinger.
“Our association represents businesses that deliver quality, well-managed rental housing, driving sustainable and social value for all stakeholders. By ensuring investors’ interests are protected, SAMRRA aims to generate additional investor interest in multifamily housing and grow the sector.”
SAMRRA will represent its members’ collective interests with regulators, government entities, other associations, and the broader public. It will promote transparent governance and information on members’ social, environmental, financial, and economic objectives.
The ultimate function of SAMRRA is to support inclusive investment, consistent returns, and stakeholder satisfaction. Through transparent industry value promotion, it aims to shape a resilient future asset class. Its first order of business has been to commission a white paper from MSCI and the Centre for Affordable Housing Finance in Africa (CAHF) – sponsored by Absa Commercial Property Finance and Divercity Urban Property Group – to position South Africa’s multifamily housing market locally and globally. Research findings will be published and presented as part of a national roadshow in March 2024.
Members currently include institutional landlords who own and manage large-scale, multifamily residential estates and other entities closely aligned with their common interests.
“SAMRRA has been constituted to meet opportunities and challenges within this sector, which is consistently growing, becoming more sophisticated and attracting greater investor interest. We are excited to represent and institutionalise the multifamily residential rental property in SA as it enters its next, compelling phase and look forward to actively engaging with long-standing and new stakeholders alike,” says Kritzinger.
