Property Flash


It feels incredibly difficult to find positives in SA right now. Everywhere we turn, there is a crisis. But crises also bring opportunities. It turns out that some of these opportunities lie in one of the oldest trading practices: auctioneering.

Auctions become popular when businesses are in distress and SA is about to enter an incredibly challenging time as it goes into 2023. Power problems are set to worsen and water shedding looms. Eskom is looking to replace its CEO André de Ruyter who resigned this week and will leave at the end of March 2023. Rolling blackouts and failing infrastructure are putting more companies into distress. Therefore, with more businesses set to close their doors, expect owner occupiers of offices, for example, to put all kinds of properties up for sale. Enter the likes of Galetti, a top-quality corporate property agency which operates in the Western Cape, Gauteng and KwaZulu-Natal. The group hosted its first auction ever at the end of November and now plan to host ten auctions a year.

Galetti will be able to make attractive fees from running these auctions. While not only distressed assets will go on auction, do expect to see them feature as the nature of auctions is that they help people to sell assets quickly and expose a seller to a variety of buyers.

On November 30, Galetti auctioned nearly R400m worth of properties at the stunning Summer Place events venue in Illovo. The company pulled the auction off with aplomb.

A bold mix of properties was auctioned including offices, petrol stations, warehousing space, and convenience retail centres. Even some houses caught bargain prices including a five-bedroom home in Boksburg and a luxury home in Sandhurst.

Galetti has rapidly grown under CEO, John Jack’s leadership and is finding new income streams. One of these is its exciting auction business. The first Galetti auction featured more than 30 properties and was attended by professionals from across the real estate industry and individual investors but also members of the public who wanted to be entertained, and they were.

The largest property in the auction was a Witbank Engen service station valued at R90m. It encompassed a petrol station, Wimpy, Woolworths and a Burger King and is currently under development.

John Jack explains that Galetti is focusing on commercial property as a general segment for its auctions.

“We will also be focussing on the VIP distressed asset sales,” he says.

The group is pursuing new income streams as it grows into the future.

“Our proptech strategy continues to grow and while I do not think anyone has found the golden egg in proptech just yet. I do think we are well ahead of the market in this space,” he says.

Why did Galetti decide to enter the auction arena?

“We noticed that our clients wanted optionality when it comes to their properties. With us we could sell by private treaty and sealed bid, auction was the natural expansion of our offering giving sellers a complete playbook of options for any portfolio. Not one size fits all when it comes to property,” he says.

Expect to see more real estate investment trusts (Reits) and large corporate property owners using auctions as a disposal mechanism in SA.

“Auction is about speed and focus as well as price discovery. Sometimes creating the market where a property has stood still for months auction often creates activity by adding a deadline to the sale,” he says.

Get ready to see Galetti’s auction business soar in 2023.

Editorial for Galetti Corporate Real Estate

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