Intersect Sectional Title Services has, recently, substantially grown their management contracts in the suburb of Hout Bay – becoming regional specialists in the area.
Martin Bester, Managing Director of Intersect, who is a member of the Residential and Sectional Title Committee of SAPOA, the National Association of Managing Agents and the Sectional Title Regulations Board, explains that Intersect has recently been awarded management contracts for Sea Glade and Silvermist Mountain Lodge, both of which are in Hout Bay.
“Sea Glade is beautifully situated on the Disa River in Hout Bay and consists of 66 upmarket town houses,” explains Bester, “and Silvermist Mountain Lodge is situated on the forested Southern slopes of Table Mountain and within the Table Mountain National Park.”
Hout Bay is a beautiful suburb and a growing one, with increasing residential developments as well as increasing industry. Intersect has identified it as an area in which we wish to focus.
Other current Hout Bay management contracts within the Intersect stable are Villa di Legno and Princess Beach.
Prime new commercial and industrial project managed by Intersect
Intersect, the sectional title subsidiary of the Spire Property Group has been awarded the management contract for Glenkey Mews, a light industrial sectional title scheme that is situated within the prime commercial and industrial development of Sheffield Business Park – also managed by Intersect.
“The newly built Glenkey Mews is situated in a great location and consists of six units that average between 217 and 434 square metres in size – all secured by monitored access as the Sheffield Business Park itself has security controlled 24 hour access,” explains Martin Bester, Managing Director of Intersect.
Sheffield Business Park is a 56-hectare development, situated on the corner of Lansdowne and Ottery and adjacent to the Spar distribution centre. It is one of the largest single, multi-use commercial and industrial projects seen in the Cape in recent years and falls within the Lansdowne Corridor redevelopment programme – a government initiative focused on upgrading one of the busiest arterial commuting routes.
“Intersect administer the Property Owners Association for Sheffield and now manage the Body Corporate for Glenkey Mews within the Park.”
Antony Payne, developer of Glenkey Mews, says that he has been working with Intersect, who manage several of his companies’ properties, for several years. “Intersect have always been a professional organisation and their experience and willingness to share their knowledge is a great ‘value-add’ to the developments that they manage.”
For those needing custom manufacturing and light industrial space, Glenkey Mews, within the Sheffield Business Park, is one of the most attractive options currently in terms of location and value. “Intersect are proud to be involved in this development and are confident that we can add value through our services and expertise,” concludes Bester.
Welcome tax relief for Body Corporates
South African body corporates have been given some welcome tax relief through the Taxation Laws Amendment Act, which was promulgated by SARS in July of last year.
The Act states that all taxable income received by body corporates, i.e. income other than that derived from levies, will be granted a R50 000 exemption per annum.
According to Martin Bester, Managing Director of Intersect Sectional Title Services, a subsidiary of the Spire Property Group, up till now, taxable income earned by body corporates was subject to taxation at prevailing company rates. This included inter alia interest earned on investments and rental income.
“We have always encouraged the schemes we administer to build healthy cash reserves but these reserves were being eroded by the taxation that was payable on the interest earned. Now that the first R50 000 of such income is exempt from taxation, we are seeing a welcome relief for all schemes.”
”Building cash reserves, to meet unexpected expenses and allow for reasonable contingencies is sound practice.” “At Intersect we ensure that our client’s funds are invested at the best possible rates, whilst ensuring liquidity and, given our membership with the Estate Agency Affairs Board, with fidelity fund cover as well.”
“Interest earned on investments is not the only income that body corporates could earn, they might also derive income from sources such as rentals, and this too will be subject to the exemption.”
VAT and the Home Owners' Association
In finance minister, Trevor Manuel’s budget speech in 2008 it was announced that the annual threshold for VAT will be increased from R300 000 to R1 million.
According to Martin Bester, Managing Director of Intersect Sectional Title Services, a subsidiary of Spire Property Group, this is potentially good news for residential home owners associations whose levy income is below the new threshold as they may now opt to deregister for VAT as some were registered due to confusion in the past on this topic.
“Levy income at home owners’ associations is subject to VAT at the standard rate in terms of section 7(1)(a) of the VAT tax Act, No. 89 of 1991, therefore, historically, all schemes with an income of over R300k per annum were obliged to register. But in residential schemes there is little, if any, material benefit to being VAT registered and deregistering will reduce the admin burden on the scheme.”
“Furthermore,” says Bester, “schemes can also save money as most managing agents charge additional fees for completing the VAT returns and the audit should be less complicated and costly too.”
Of course not all home or property owners associations will opt to deregister and Bester advises that an accountant would be the best person to direct the trustees and/or Directors in this regard as the net input and output VAT of the scheme should also be considered.
“Intersect constantly strives to reduce the administrative costs of the associations that they administer.”
In this light, Bruce Kerswill, the managing director of Spire Property Group and Bester, concur that, from an administrator’s point of view, they believe that deregistration should be seriously considered.