After buying Marriott's share of Motseng Marriott Property Services last week Sandile Nomvete's Motseng Investment Holdings is now the 100% owner of the largest black empowerment property management business in South Africa.

This makes him one of the most significant black entrepreneurs in the local property industry, and one of very few with the skills and track record to capitalise on the BEE opportunities likely to be created by the property charter.

His company, Motseng Property Services, will now be in sole charge of two of the country's largest shopping centres, the R800-million Westgate in Gauteng and the R800-million Pavilion in KwaZulu-Natal.

This might be enough for most 31-year olds, but not for this young live wire.

Property management is important, he says, but it is not where the action is.

"It is a foot in the door."

Offering services to property owners is something he will continue to take extremely seriously. As we speak he is about to jet off to the US to learn about new trends and technologies from the companies that run the largest shopping centres in the world.

But property management does not create wealth, he says. At least not the kind he's dreaming of.

"Real wealth-creation is owning those properties."

You get an idea of Nomvete's dreams when he tells you with palpable excitement that he has just finished Anton Rupert's biography.

"It's fascinating."

He's amazed at the close parallels between the Afrikaners' struggle for economic power and the economic empowerment of blacks today.

Except that "Rupert actually built something", he acknowledges, which cannot be said of many BEE beneficiaries, although it can of Nomvete.

From the moment he got his first job his dream was to be an entrepreneur and build his own business "from scratch". He has done this. Now, with a R50-million interest in the industrial group of South Africa's largest single foreign investor, Claas Daun, to add to his property interests, his own empire is beginning to take shape.

Nomvete grew up in the Durban township of Hammersdale. He went to a private prep school in the Midlands and then to St Charles, a private high school in Pietermaritzburg.

He was "never an academic", he claims. What gave his life meaning in those days was sport. He captained the tennis team, played first team cricket and first team rugby, and ran for Natal schools. "10.8 for the hundred," he can't resist telling me. "On grass, nogal." Also the 400 metres, "one of the races that separates the men from the boys".

Afterwards he wanted to be an attorney but his father "almost forced" him to study computers instead. "It's the next big thing," he said, pre-empting the information technology boom by a couple of years.

With a diploma in computer programming under his belt, Nomvete joined NBS bank as a junior programmer.

His cousin was an attorney and when he walked into his office one day and saw a chaos of papers and concertina files, he decided to develop a software programme which would handle the irksome but necessary paperwork for small law firms.

Truth and Reconciliation commissioner Dumisani Ntsebeza was his first client.

He sold the business for about R100,000 in 1996 to concentrate on his work for the bank, but he had been "bitten by the entrepreneurial bug".

After a couple of years with the Tongaat Hulett Group as a senior programmer and systems analyst, he joined a small black IT firm, Everest Systems Solutions, which had won a project to do the year 2000 conversion for Kenya Power and Lighting, Kenya's answer to Eskom.

When he returned from Kenya in late 1997 his desire to run his own business was stronger than ever.

It seemed there were zillions of "special-purpose vehicle" BEE transactions going on, and he wanted to be part of the action.

"Every single black guy I ran into was doing a deal. There was money for jam to be made."

Nomvete quickly spotted a glaring gap in all this.

"No one was bringing the youth into these deals. You had all these senior guys with connections, but there was no youth."

In 1998 he and two colleagues started Motseng Youth Investments. None of them had any particular financial skills, but Ipeleng Mkhari, who he had known when she was head girl of St John's school next door to St Charles, was a whizz at presentations and "could sell ice to an Eskimo".

And Jabu Mriga, a security guard who studied at night to better himself, knows how to get the best out of "the average worker" and became "our operations man".

Nomvete and Mkhari are now worth around R45-million each, and ex-security guard Mriga a handy R2.5-million.

The gap they saw was that while people were doing deals left, right and centre through SPVs, no one was doing anything operational in the companies in which they invested.

"We said, 'when you do deals bring us in to be junior managers and get involved in operating these companies'."

They went to "every merchant bank in town" for seed capital but were turned away.

"We don't see the space for you guys right now," was the typical response.

Mkhari had just started a small company that installed CCTV systems, and they used that as a platform for Motseng.

They installed cameras for the Airports Company of SA, Telkom and the Reserve Bank. Without much capital they had to get overdrafts from the bank to buy stock.

But they got some cash flow going and expanded into the provision of manpower to monitor the cameras, and guards to provide security.

They merged with an established security company, Enforce, in KwaZulu-Natal, which provided services to property management companies.

This eventually led them to Marriott, an old, Durban-based property fund management company whose client Pareto, 60%-owned by the Eskom pension fund, told them they needed to get a BEE partner.

A 50-50 joint venture property management company called MotsengMarriott resulted, and they benefited from a "vigorous" property management skills transfer process.

In 2002 they decided to offer Daun their services, and were given one hour with the great man to state their case.

They found him "very intense, very hard, not easily pleased", says Nomvete.

He told them if they had come to sell BEE to him then the meeting was over. "I'm a foreigner. I don't know much about this BEE thing."

But if they were coming as young entrepreneurs who wanted to grow, "then we can talk".

Now they are his official BEE partners in South Africa. When he listed his businesses as Kap International Holdings last year Nomvete, Mkhari and Motseng chairman JB Magwaza became directors of the R3-billion company.

They own 51% of Daun's Mooi River Textiles, and run a R70-million a year business supplying linen, uniforms and takkies to the hospitals, prisons, army and police.

Nomvete's gaze is now focused on part of Transnet's 26% of the V&A Waterfront.

Then there is cash-strapped Denel also looking to offload its commercial and retail properties.

Business Times
Publisher: I-Net Bridge
Source: I-Net Bridge