2017 will be an important year for Pam Golding. The real estate agency announced new developments, mainly in Grand Bay. Its Operations Manager gives more details on these projects and shares his views on the construction sector as well.
Richard Haller
What is role and how do you fit into Pam Golding?
I joined the Pam Golding Property Group in 2004 after working for Goldman Sachs Investment Bank in London. For over 10 years, I have been involved in the international operations of the group, with a specialised focus on launching residential real estate developments based in Southern Africa and the Indian Ocean islands to the international market. I have also been responsible for the general management of traditional real estate businesses (residential sales and letting markets) in these areas. I decided to join the team following the change in legislation in Mauritius in 2004 that allowed foreigners to purchase real estate on the island and to qualify for permanent residency. It was when PGP had the privilege to successfully launch the first ever IRS development, Tamarina Golf and Beach estate.
Within the past five years, my attention has been shifted to the noticeable opportunities in the Mauritian real estate market. I have been actively involved in the successful launch of over 20 new real estate projects as well as overseeing the Pam Golding Properties operations on the island. Most recently, I have played an integral role in the successful launch of the prestigious Mont Choisy Le Parc Golf and Beach Estate, with sales in excess of USD 250 million since March 2013. I will be moving to Mauritius in January 2017 to focus my full attention on our Mauritian business.
What are the upcoming real estate projects of Pam Golding in Mauritius?
We aim to launch Phase 3 of our flagship development, Mont Choisy Le Parc, in the early part of 2017. We have sold over USD 250 million (Rs 9 billion) since we launched in March 2013. We expect Phase 3 to be a mixture of villas and apartments which we anticipate will be very well received by the local and international market. Another project we are launching now is Ki Villas, a PDS situated in a prime location in Pereybere. It consists of 22 villas of 3 and 4 bedrooms, 19 of these being single storey homes.
A new local project launching shortly exclusively by Pam Golding Properties is Excelsior Sodnac. Situated in the vibrant heart of Sodnac, it consists of just 18 units, 12 standalone homes and 6 duplexes. With a 360-degree view of the surrounding mountains, each unit will benefit from its own private garden and a parking area.
Why is FDI important for the sector?
The three main sectors that generate FDI into Mauritius are real estate, tourism and construction. The IRS legislation implemented over 10 years ago which allows foreigners to purchase real estate on the island is a strong contributor to FDI and has been a significant strategy by the government to attract investment and wealth into Mauritius.
Similarly, the driving of tourism by the Mauritius Tourism Board is paying dividend. For the first time ever, the number of tourist arrivals crossed the 1 million mark in 2014 and for 2015 increased by 10.9% to reach almost 1.2 million. Similarly, the trend for the first half of 2016 is a 9.9% increase versus the same period last year. If tourism arrival growth continues at the current rate, the number will reach close to 1.9 million per year by 2020, which is tremendous growth in one of the country’s main sectors.
It is noticeable that Mauritius now boasts one of Africa’s highest per capita incomes and has moved from a lower income economy to a middle income economy.
Is Mauritius putting enough effort to attract investment in the real sector?
I feel that the authorities are doing an admirable job in terms of attracting investment into the country. The approach by the Board of Investment to attract business and industry from other countries is noteworthy, coupled with the attractive corporate and personal tax rates and relative ease of doing business. Mauritius has positioned itself well as a gateway to do business in Africa. So when you look at the entire picture, then the puzzle starts to come together. Furthermore, attention is being given to education and attracting international schools and universities to the island. This is important from a foreign talent acquisition perspective and for providing quality education for local Mauritians.
From my viewpoint, Mauritius has taken a strong multipronged approach to attracting investment which is now paying dividend and personally I am optimistic that Mauritius is on a good growth path for to next 5 - 10 years.
What are your views on the slowdown of the construction sector during these last years?
When looking at the RES and IRS development market, 2015 was a good year for registrations. However, looking forward, we do not see any new large property developments on the cards that will trigger large scale construction. Many of the existing IRS projects are towards the end of their construction life cycle. In order to keep the construction industry busy, it will take the larger IRS and Smart City projects – especially those with good momentum – to launch new phases to keep construction going. Also, we are not seeing PDS projects having the same impact as RES projects did. However, with the recent positive change to the PDS rules (removal of prescribed 25% local buyers), the supply of PDS should improve and thus contribute to the construction sector.
The large retail developments of Bagatelle Mall, La Croisette and Cascavelle Mall have completed and little appears in the planning phases of retail developments. It’s likely that the construction sector will be somewhat reliant on IRS and PDS and importantly public works to make up for the slowdown.
From a more general perspective my view is that the strategic endeavour of Mauritius to make the island an inviting place to work, live and do business will bode well for the construction sector over the medium to long term. The creation of friendly policies that support the new smart cities and Freeport zones and the drive to attract business, innovation, education, talent and so on into Mauritius, will play an important role in supporting the construction sector.
On another note, real estate operators are noticing a rise in demand for office space. What are the reasons for this?
Underpinned by the drive of the country to be the gateway for business into Africa, we have within the last 12 months noted an increase in office space enquires. I have spoken to a number of clients who are investigating moving their manufacturing or financial businesses to Mauritius due to the various incentives and attractive tax initiatives in place.
Government intends to attract retired Mauritian citizens from abroad so that the country can benefit from their experience and purchasing power. What is your take on this initiative?
Mauritius introduced the retired citizen permanent residency visa which requires retirees to bring in USD 40,000 per annum. It is difficult for retired citizens to relocate as it is. So the possibility of not having the visa renewed is a concern for them. Permanent residency through real estate is a more certain way for foreigners to reside in the country because residency is linked to the property. So the vast majority prefer the real estate option.
In terms of attracting purchasing power, not only from retired people, the latest statistics suggest that the number of United States dollar millionaires living in Mauritius has increased by 340% since 2000. It is expected to rise by a further 130% over the next 10 years making it the fastest growing African market for millionaires over this period. There have been a significant number of wealthy individuals who have moved to Mauritius from France and South Africa since 2007.
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