Background

Telkom, a major telecommunications company in South Africa and partially owned by the government, has explored a significant transformation of their vision and strategy, to capitalize on none-core properties across the country. As part of this process, Telkom decided to dispose of selected properties across the country, managed by its property division, Gyro. In2Assets, a leading property specialists’ firm, was entrusted with the task of disposing a large number of properties by using auction as a way of selling. 

 Scope and Objective

One of the objectives was to achieve the highest possible prices for the properties, while also ensuring a smooth and efficient disposal process. In2assets were tasked with assessing, evaluating and finally marketing the properties to local national and international markets, leveraging their expertise and network to reach potential buyers.

The portfolio consisted of 127 properties during 2023/2024 scattered across various regions in South Africa, including vacant land, transmission stations, telecommunication hubs, single and double-storey buildings, offices, client service centers, warehouses and even residential dwellings. 

The primary objectives were to unlock value from the Telkom property portfolio, reduce the property footprint, optimize operating costs, and realize significant cash proceeds for Telkom.

 Marketing Strategy

In2Assets employed a multi-faceted marketing approach, tailored to each local market, to reach a wide range of potential buyers. The strategy included:

Local Market Focus where Properties were grouped by region, and targeted marketing campaigns were implemented to reach local buyers, investors, and businesses.

Digital Marketing via online advertising platforms, social media, and email marketing were used to promote the properties, leveraging In2assets' existing and extensive database and online presence.

Print Media in local newspapers, property magazines, and industry publications were used to reach a wider audience.

Direct Marketing via personalized letters, emails, and phone calls were made to potential buyers, investors, and businesses in each region.

Open Houses and Viewings on the relevant properties were conducted, allowing potential buyers to inspect the properties firsthand.

Multiple livestreamed auction events were held across the country, providing a platform for buyers to bid on properties in a competitive and transparent environment.

The portfolios comprised a large variety of properties in almost every province of South Africa. 

 The Auction Process

The auction process was designed to be transparent, efficient, and competitive. Properties were offered on an "as-is" basis, with buyers required to conduct their own due diligence. The auction process included live bidding, livestreamed bidding, telephonic bidding and proxy bidding.

 Sales Results

The portfolio sales of the selected Telkom Properties achieved remarkable results, with:

Record Prices - Most properties sold for record prices exceeding expectations and demonstrating the effectiveness of In2assets' marketing strategy combined with expert auctioneering services. 

Turnover - The total turnover exceeded R 1.1 billion, a testament to the success of the auction process.

Buyer Diversity - A diverse range of buyers participated in the auction, including local businesses, investors, and individuals transforming undesirable properties to new use. 

Regional Success - Properties in each region achieved strong prices, demonstrating the effectiveness of In2assets' local market focus.

Out of 127 properties 123 were sold immediately at the auction, resulting in a staggering 97% success rate. The results achieved at each of the four portfolio property auctions substantially exceeded the pre-auction expectations and the actual knockdown prices surpassed these initial expectations on average by over 45%. 

Conclusion

The collaboration between In2Assets and Telkom on the sale of so far five Telkom property portfolios serves as a prime example of effective property marketing and property auction management. By understanding and catering to local markets, utilizing multiple marketing channels, and executing a well-planned auction process, In2Assets was able to achieve overall record prices and a turnover of over R 1.1 Billion. This case study highlights the importance of precision marketing, local expertise, and efficient property knowledge in realizing significant value from a diverse and geographically scattered property portfolios.