Multi-use industrial, office and storage space

Business Model

Our business parks offer a mixture of industrial, office and storage space. We acquire and operate industrial zoned properties that are repositioned to enhance the working environments of our clients.

Our management company provides the operational platform that starts with finding new sites, transforms sub-optimal industrial and commercial spaces, fills them up, sells units and runs the day-to-day services for each park.

We significantly add value to these assets using our internal operating platform that does the following:

Leases out vacant spaces through a combination of larger conventional leases at market rates and breaking up spaces into smaller micro units
Changes the use of traditional industrial space into office, storage and retail warehousing space which are segmented
Sets up sectional title schemes at certain parks and sells units to end-user investors at 30% - 50% above the purchase rate per square metre paid on acquisition
Disposes of parks to external investors and we recycle equity into new assets
Manages properties on behalf of third-party owners under long term Park Operator Agreements

Mixed Use Business Model

We either manage parks owned by our property-owning investment companies or we manage on behalf of external property owners or those who purchase sectional title units from us. All parks, irrespective of ownership, are managed in terms of Park Operating Agreements and Park Conduct Rules.

At its core, our business model is that of a real estate business with an operational overlay that benefits from clients and users, who are offered far more than what traditional real estate companies are offering through vanilla leases with no additional benefits.

OUR BUSINESS

Our Story Space as a Service Business Model

Our business model is underpinned by 4 activities overlaid by 7 value-enhancing strategies

We seek out industrial properties that can be converted into secure business parks in terms of our acquisitions strategy. We have created propriety processes and systems to target new locations using a centralized repository of data, analytics, acquisition models and contractual agreements that allow us to directly source opportunities.

Every acquisition opportunity flows through our deal acquisitions team, which standardises approvals and risk, uses data analytics to determine price points and follows a process that is approved and managed by the following Inospace teams:

Asset Management that runs the financial analysis
Project Management that provides optimisation and refurbishment cost
Marketing that provides the costing and strategy for new parks
Finance that provides any operational cost specific to the property

Our optimisation model shares multiple points of coordination through systems designed for speedy approvals, due diligence, budgets, negotiations and contracts. We design and plan each business park according to a business plan and formal model that indicates the park grading and the proposed segmented product mix.

Our internalised project managers use a design manual together with an on-boarding process to create a new business park that is cost-effective to refurbish and maintain. Before we take possession of a new site, we engage with asset management, brand design, marketing and sales to create a comprehensive optimisation plan with budgets and timelines.

Transformation projects are usually light renovations and upgrades completed in a 6-month programme. We continue to develop and redefine our process from possession to opening new parks, and we expect our growth and scale to provide efficiencies in opening new parks for the foreseeable future. We continue to maximize the income and value of mature parks through ongoing asset and property management programmes as further optimisation opportunities arise.

Our in-house sales teams are project, product and geographically focused. They use a wide range of advertising and marketing channels to attract new clients and to market available spaces. Digital marketing, a strong social media presence, in-park sales campaigns as well as an internal sales team who live our values, are all key to attracting and retaining clients and ensuring high levels of client satisfaction.

An in-house and integrated sales team is a critical strategic function that allows us to speedily fill-up-and-sell spaces and generate cash flow. Our sales functions, incorporating leasing, acquisitions and disposals, are a key competency and strength for Inospace.

Our sales functions are aligned with our segmented product offerings in our 3 property sectors: industrial, office and storage. While commonalities exist between products and sectors there are material differences in how we engage different size clients. As an example, micro-units require fast-paced retail sales while mega-units require targeted sourcing, longer negotiations and customised installations.

We thus have focused, specialised experts in geographic regions and in product offerings.

We operate our parks with on-site park management teams who are empowered and incentivised to make decisions that are supported by a set of centralised systems and standards. We have a decentralised property management model with most decisions made on site.

We have an operating standard, encapsulated in the Inospace Way, which details all management aspects of our parks, from conduct, to security, to the use of shared facilities, to events. Ensuring consistent delivery across our portfolio is key to the profitability of each serviced business park.

The managed outcome of each site is driven by the maturity of each site; we define parks that have been open for more than 12 months as being mature. Once a site reaches maturity, tenancy is strong, our initial refurbishment and sales programmes are complete and the business park is generating a recurring revenue stream, contributing to fees and cash flow.