Real estate investment firm REdimension Capital has raised R200 million to fund South Africa’s burgeoning property technology (proptech) start-up companies.
In a statement yesterday, the firm announced the first close of its inaugural fund − the REdimension Real Estate Technology and Sustainability Fund I.
It says this fund, which received support from stakeholders in the real estate sector, will focus on investing in early-stage innovative technology companies that deliver demonstrable improvements in the way property is developed, managed and engaged with.
By strategically aligning with sector stakeholders, it notes, the fund has built an ecosystem of mutual value, aiming to deliver investment and operating returns, while accelerating technology adoption and driving sustainable outcomes.
The fund has achieved its first close target, having received total commitments of over R200 million.
REdimension Capital says it is proud to have gained the trust and support of the fund’s founding investors, including Investec Property Fund, Growthpoint Properties and Rand Merchant Bank, which have anchored the fund.
The fund is further supported with investment from Liberty Two Degrees, Liberty Group and Sphere Holdings, among others.
According to the company, the founding investors provide a significant strategic underpin, with over 650 properties across sectors directly under management.
It notes this portfolio represents over 11 million square metres of gross lettable space and is valued at over R235 billion.
Furthermore, it points out, it is anticipated that additional strategic commitments will be made to the fund before a final close on or before January 2025.
REdimension points out that the fund will target investment in companies developing high-impact solutions that operate at the convergence of real estate and technology.
It will take a thematic approach to investment, focusing on areas which have a clear value proposition and solve the sector’s challenges, it explains.
This includes various built-world technologies that aim to improve the way assets are experienced, streamline management processes and decision-making, and which ultimately accelerate the digitalisation of the real estate industry.
The firm adds that sustainability lies at the core of the fund mandate – it is committed to supporting technologies that promote energy-efficiency, a reduced carbon footprint, and contribute positively to local community engagement, thus helping to enhance climate resilience for the real estate sector and promoting social inclusion.
As a fund backed by the industry’s incumbents, it says the intention is to support early-stage proptech companies with inherently scalable business models and provide a platform for distribution and value creation.
REdimension Capital founders Peter Clark and Matthew Marshall say: “We are thrilled to have achieved a first close for the REdimension Real Estate Technology and Sustainability Fund I.
“It marks a significant milestone in the evolution of property technology investment in South Africa. We are grateful for the support received from our founding investors and look forward to delivering for them, while creating a meaningful and lasting positive impact on the markets in which we operate.”