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1 Welcome

2 SCOPE OF PROPERTY SECTOR CODE

3 Property Sector Code - Scope Residential Property Industry Houses Community schemes Flats, Clusters, Town Houses etc Zoned land Commercial Property Industry Office Property Industry Industrial Property industry Retail Property Industry Leisure Property Industry Zoned land

4 Property Sector Code - Scope Property Services Property Ownership Property Letting Property Management Property Sales Property Valuation

5 Focus of application Clause If you own property merely for the execution of your primary business Not included in the scope If you lease/rent any portion of that property you are included in the scope (income generation)

6 DEVIATIONS PROPERTY SECTOR CODE

7 GAZETTING UNDER SECTION 9 SECTOR CHARTER Property Sector deviations Weighting our of 107 Ownership New code: Economic Development Property Complex Structures QSE Threshold (code 800) Use COGP as base document Where PSC is silence COGB applies

8 PSCC & COGP ELEMENT PROPERTY SECTOR CODE CODES OF GOOD PRACTICE Ownership 20 points 20 points Management control 10 points 10 points Employment Equity 15 points 15 points Skills Development 15 points 15 points Preferential Procurement 20 points 20 points Enterprise Development 10 points 15 points Socio-Economic Development 2 points 5 points Economic Development 15 points TOTAL

9 PSCC & COGP ELEMENT PROPERTY SECTOR CODE CODES OF GOOD PRACTICE Ownership 20 points 20 points Management control 10 points 10 points Employment Equity 15 points 15 points Skills Development 15 points 15 points Preferential Procurement 20 points 20 points Enterprise Development 10 points 15 points Socio-Economic Development 2 points 5 points -5 Points -3 Points Economic Development 15 points +15 Points TOTAL

10 PSCC & COGP: Code 800 ELEMENT Companies (Big Companies) Qualifying Small Enterprise (QSE) Micro Enterprises (EME) CODES OF GOOD PRACTICE Revenue QSE exceeding R35M Turnover R5M-R35M Turnover R5M and below PROPERTY SECTOR CODE QSE Revenue exceeding R35M Estate Agents/Brokers Turnover/Rev R2.5-R35M Services Based R5M-R35M Asset Based Net Assets R30M-R280M Turnover R5M and below/r2.5m-r5m

11 QSE Threshold ASSET BASED SERVICE BASED ESTATE AGENTS/ BROKERS QSE enterprises whichever is higher NET ASSETS R30M-R280M GROSS INCOME OR TURNOVER R5M-R35M R2.5M-R35M

12 Purpose OWNERSHIP Code types of companies Property owning companies All other companies All other companies Follow the ownership as per the COGP Property owning Companies Have a defined ownership codes with deviations from COGP

13 OWNERSHIP Code 100 (All other Comp.) CATEGORY OWNERSHIP INDICATOR WEIGHTING POINTS PROPERTY OWNING COMP. Voting Rights Exercisable Voting Rights in the Enterprise in the hands of black people Excercisable Voting Rights in the Enterprise in the hands of black women 3 25% +1 vote 2 10% Economic Interest of black people in the Enterprise 4 25% Economic Interest of black women in the Enterprise 2 10% Economic interest Economic interest of the following black natural people in the enterprise: 1. black designated groups; 2. black Participants in Employee Ownership Schemes; 3. black beneficiaries of Broad based Ownership Schemes; or 4. black Participants in Co-operatives 1 2.5% Ownership fulfillment 1 Refer COGP Realisation points Net equity Value 7 Annexure C paragraph 4 of the codes of good Practice 20 points

14 OWNERSHIP Code 100 (Prop. Owning comp) CATEGORY OWNERSHIP INDICATOR WEIGHTING POINTS PROPERTY OWNING COMP. Voting Rights Exercisable Voting Rights in the Enterprise in the hands of black people Excercisable Voting Rights in the Enterprise in the hands of black women 5 25% +1 vote 2 10% Economic Interest of black people in the Enterprise 5 25% Economic Interest of black women in the Enterprise 2 10% Economic interest Realisation points Economic interest of the following black natural people in the enterprise: 1. black designated groups; 2. black Participants in Employee Ownership Schemes; 3. black beneficiaries of Broad based Ownership Schemes; or 4. black Participants in Co-operatives 1 2.5% Ownership fulfillment 1 1 Net equity Value 4 Yr1-3% Yr6 24% Yr 2-7% Yr7-30% Yr 3 10% Yr8-36% Yr 4-15% Yr9-43% Yr 5 19% Yr10-50% 20 points

15 OWNERSHIP Code 100 (Prop. Owning comp) Weighting CATEGORY OWNERSHIP INDICATOR Prop Owners COGP Voting Rights Exercisable Voting Rights in the Enterprise in the hands of black people Excercisable Voting Rights in the Enterprise in the hands of black women Points Economic Interest of black people in the Enterprise 5 4 Economic Interest of black women in the Enterprise point Economic interest Economic interest of the following black natural people in the enterprise: 1. black designated groups; 2. black Participants in Employee Ownership Schemes; 3. black beneficiaries of Broad based Ownership Schemes; or 4. black Participants in Co-operatives 1 1 Realisation points Ownership fulfillment 1 1 Net equity Value Points 20 20

16 NET EQUITY VALUE YEAR PERCENTAGE Year 1 3% Year 2 7% Year 3 10% Year 4 15% Year 5 19% Year 6 24% Year 7 30% Year 8 36% Year 9 43% Year 10 50%

17 NET EQUITY VALUE YEAR Prop COGP Sector Code Year 1 3% 10% Year 2 7% 20% Year 3 10% 40% Year 4 15% Year 5 19% 60% Year 6 24% Year 7 30% 80% Year 8 36% Year 9 43% 100% -7% -13% -30% -41% -50% -57% Year 10 50%

18 Deviations Ownership The exclusion of mandated investments up to 40%. Different calculation for Net value

19 Deviations Ownership: Mandated investment Given that the majority of the listed share register have a mandated investments that are far beyond 40%, a special consent is given for only property listed companies and property unit trusts to cap the mandated investment at 70%. Despite this provision, the cap shall remain 40% as in Generic Codes for those Listed Companies and Unit Trusts, unless there is consistent evidence of 60% or more of the mandated ownership 3 years prior to being verified of their BBBEE status

20 Deviations Ownership For verification Your organisation needs to provide: Monthly average share register for 3 years (36 month) from an accredited share reading company

21 EMPLOYMENT EQUITY Code 300 CATEGORY MEASUREMENT CATEGORY & CRITERIA WEIGHTING POINTS COMPLIANCE TARGET Years 6-10 Black practitioners as % of total practitioners using the adjusted recognition for gender 7 50% Property brokers/ Estate agents Black people in Management as % of total Management using the adjusted recognition for gender 7 35% Black women in management as a total of management 1 18% Black practitioners as a % of total practitioners using the adjusted recognition for gender 1 60% Bonus Points: (Property brokers/estate agents) Black people in management as a % of total practitioners using the adjusted recognition for gender 1 40% Black women in Management as a % of total Management 1 15 points 30%

22 15 points EMPLOYMENT EQUITY Code 300 CATEGORY MEASUREMENT CATEGORY & CRITERIA WEIGHTING POINTS COMPLIAN CE TARGET Years 6-10 Disabled Black Disabled Employees as a percentage of all employees 2 3% Senior Management Black Employees in Senior management as a percentage of all employees using the adjusted recognition for gender 5 60% Middle Management Black employees in Middle Management as a percentage of all employees using the adjusted recognition for gender 4 75% Junior Management Black employees in Junior Management as a percentage of all employees using the adjusted recognition for gender 4 80% Bonus Points: Bonus points for meeting or exceeding the=eap target in each category (Snr=1, Middle=1 & Junior= 1 Point) 3

23 Deviations Estate Agents Can either be an employee or supplier Estate Agents as employees They are not unique Insurance brokers If an agent only working for 1 agents s/he is an employee Estate agent is defined as practitioner counted under EE Estate agents as suppliers If the agent works for more than one agency she is a supplier Counted under procurement NB: Estate Agents must be counted somewhere

24 CRITERIA BEE Procurement Spend from all Suppliers based on the BEE Procurement Recognition Levels as a percentage of Total Measured Procurement Spend PREFERENTIAL PROCUREMENT Code 500 WEIGHTING POINTS COMPLIANCE TARGET 10 70% BEE Procurement Spend from Qualifying Small Enterprises or Exempted Micro-Enterprises based on the applicable BEE Procurement Recognition Levels as a percentage of Total Measured Procurement Spend BEE Procurement Spend from any of the following Suppliers (regardless of their BEE Procurement Recognition Level) as a percentage of Total Measured Procurement Spend: 1. Suppliers that are more than 50% black owned (3 out of 5 points); and, 2. Suppliers that are more than 30% black women owned (2 out of 5 points). 2 15% 5 20% (12%) (8%) % spend property services Enterprises (Level 1-4) of total property Services spend 3 40%

25 20 20 CRITERIA PREFERENTIAL PROCUREMENT Code 500 BEE Procurement Spend from all Suppliers based on the BEE Procurement Recognition Levels as a percentage of Total Measured Procurement Spend Prop Sector Code COGP Points BEE Procurement Spend from Qualifying Small Enterprises or Exempted Micro-Enterprises based on the applicable BEE Procurement Recognition Levels as a percentage of Total Measured Procurement Spend point BEE Procurement Spend from any of the following Suppliers (regardless of their BEE Procurement Recognition Level) as a percentage of Total Measured Procurement Spend: 1. Suppliers that are more than 50% black owned (3 out of 5 points); and, 2. Suppliers that are more than 30% black women owned (2 out of 5 points). 5 5 % of procurement spend with Black owned services Enterprises (Level 1-4) of total property Services spend Points

26 Measurement Principles of Procurement Qualify for recognition in all 4 criteria in the Preferential procurement scorecard BEE Procurement Spend from all Suppliers based on the BEE Procurement Recognition Levels as a percentage of Total Measured Procurement Spend BEE Procurement Spend from any of the following Suppliers (regardless of their BEE Procurement Recognition Level) as a percentage of Total Measured Procurement Spend: 1. Suppliers that are more than 50% black owned (3 out of 5 points); and, 2. Suppliers that are more than 30% black women owned (2 out of 5 points) % spend property services Enterprises Black owned enterprises (Level 1-4) of total property Services spend

27 DEVIATIONS: ECONOMIC DEVELOPMENT CRITERIA Disposal of assets to B-BBEE enterprise (Level 1-3) as a % of total asset disposal (private) which are Black Development Investment in underresourced areas as a % of total annual investment WEIGHTING POINTS COMPLIANCE TARGET 8 35% 7 10%

28 Deviations Economic Development (3 Scenarios) If no disposal of assets Take away 8 points from numerator Take away 8 points from denominator If no development in under resourced areas Take away 7 points from numerator Take away 7 points from denominator If no disposal of assets and no development Take away 15 points from numerator Take away 15 points from denominator

29 Transformation Infrastructure For Development in under resourced areas FSC matrix Incorporated all Local Municipalities Variables Income Water Sanitation Electricity Housing Index Ranking Definition of development is included in the document

30 Internal Management PLSA Unlisted Public mandated collective Investment Prop Management services Estate Agents Asset Management PLSA Prop Owners APUTS COMPLEX STRUCTURE Ownership Management Control Employment Equity Skill Development Preferential procurement Enterprise development Socio-Economic Development Economic Development

31 Internal Management PLSA Unlisted Public mandated collective Investment Prop Management services Estate Agents Asset Management PLSA Prop Owners APUTS COMPLEX STRUCTURE Ownership Management Control Employment Equity Skill Development Preferential procurement Enterprise development Socio-Economic Development Economic Development

32 COMPLEX STRUCTURE PSC GENERIC CALCULATIONS Generic Codes Qualification Property Sector Charter BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 32

33 Internal Management PLSA Internal Management PLSA Internal Management PLSA Internal Management PLSA PLSA INTERNAL MANAGEMENT- COMPLEX STRUCTURE Ownership Management Control Employment Equity Skill Development Preferential procurement Enterprise development Socio-Economic Development Economic Development

34 1. PLSA INTERNAL MANAGEMENT- COMPLEX STRUCTURE Generic Codes Qualification PLSA Internal Management BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <32

35 2. PLSA INTERNAL MANAGEMENT- COMPLEX STRUCTURE Generic Codes Qualification PLSA Internal Management BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <30

36 3. PLSA INTERNAL MANAGEMENT- COMPLEX STRUCTURE Generic Codes Qualification PLSA Internal Management BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <30

37 4. PLSA INTERNAL MANAGEMENT- COMPLEX STRUCTURE Generic Codes Qualification PLSA Internal Management BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <28

38 Unlisted Pub Mandate collective Investment Scheme Unlisted Pub Mandate collective Investment Scheme- Disposal Unlisted Pub Mandate collective Investment Scheme- Development Unlisted Pub Mandate collective Investment Scheme- Economic Dev INTERNAL MANAGED PLSA- COMPLEX STRUCTURE Ownership Management Control Employment Equity Skill Development Preferential procurement Enterprise development Socio-Economic Development Economic Development

39 1. COMPLEX STRUCTURE Unlisted Pub Mandate collective Investment Scheme Generic Codes Qualification Unlisted Public Mandate collective Investment Scheme BEE Recognitio n level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <26

40 2. COMPLEX STRUCTURE Unlisted Pub Mandate collective Investment Scheme Generic Codes Qualification Unlisted Public Mandate collective Investment Scheme BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <24

41 3. COMPLEX STRUCTURE Unlisted Pub Mandate collective Investment Scheme Generic Codes Qualification Unlisted Public Mandate collective Investment Scheme BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <24

42 4. COMPLEX STRUCTURE Unlisted Pub Mandate collective Investment Scheme Generic Codes Qualification Unlisted Public Mandate collective Investment Scheme BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <22

43 COMPLEX STRUCTURE Unlisted Public Mandate Collective Investment Scheme Generic Codes Qualification Unlisted Public Mandate collective Investment Scheme BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <26

44 PROP MANAGEMENT SERVICES COMPLEX STRUCTURE Generic Codes Qualification Property Management Services BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <28

45 COMPLEX STRUCTURE Estate Agents Generic Codes Qualification Estate Agents BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <28

46 COMPLEX STRUCTURE Asset Managers Generic Codes Qualification Asset Management BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <28

47 PLSA PLSA-Disposal PLSA- Development PLSA Economic Development PLSA- COMPLEX STRUCTURE Ownership Management Control Employment Equity Skill Development Preferential Procurement Enterprise Development Socio-Economic Development Economic Development

48 1. COMPLEX STRUCTURE - PLSA Generic Codes Qualification PLSA Property Loan Stock BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <23 PLSA Including Economic Development (Development + Disposal)

49 2. COMPLEX STRUCTURE - PLSA Generic Codes Qualification PLSA Property Loan Stock BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <21 PLSA + Development in under resourced areas

50 3. COMPLEX STRUCTURE - PLSA Generic Codes Qualification PLSA Property Owners BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <21 PLSA + Disposal of assets to level 1-3

51 4. COMPLEX STRUCTURE - PLSA Generic Codes Qualification PLSA Property Loan Stock BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% 55-65% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <19 APUTS +Disposal of assets to level 1-3

52 Prop Owners Prop Owners - Disposal Prop Owners- Development Prop Owners Economic Development PROP OWNERS -COMPLEX STRUCTURE Ownership Management Control Employment Equity Skill Development Preferential procurement Enterprise development Socio-Economic Development Economic Development

53 PROP OWNERS -COMPLEX STRUCTURE Generic Codes Qualification Property Owners BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <23

54 PROP OWNER -COMPLEX STRUCTURE Generic Codes Qualification Property Owners BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <21

55 PROP OWNERS- COMPLEX STRUCTURE Generic Codes Qualification Property Owners BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <21

56 PROP OWNERS- COMPLEX STRUCTURE Generic Codes Qualification Property Owners BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <23

57 APUTS APUTS-Disposal APUTS- Development APUTS Eco Dev APUTS- COMPLEX STRUCTURE Ownership Management Control Employment Equity Skill Development Preferential procurement Enterprise development Socio-Economic Development Economic Development

58 1. APUTS- COMPLEX STRUCTURE Generic Codes Qualification APUTS Property Unit Trust BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <20 APUTS + Economic Development (Disposal + Development)

59 2. APUTS- COMPLEX STRUCTURE Generic Codes Qualification APUTS Property Unit Trust BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <17 APUTS -Disposal of assets

60 3. APUTS- COMPLEX STRUCTURE Generic Codes Qualification APUTS Property Unit Trust BEE Recognition BEE level Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <17 APUTS -Development in under resourced areas

61 4. APUTS- COMPLEX STRUCTURE Generic Codes Qualification APUTS Property Unit Trust BEE Recognition level BEE Score PSC Score Level One 135% Level Two 125% Level Three 110% Level Four 100% Level Five 80% Level Six 60% Level Seven 50% Level Eight 10% Non-Compliant 0% <30 <15 APUTS Economic Development

62 PSCC -QSE SCORECARD SAME AS Ownership ELEMENTS Management control Employment Equity COGP CODES OF GOOD PRACTICE 25 points 25 points 25 points This applies companies with revenues as defined by PSCC Skills Development Preferential Procurement Enterprise Development Socio-Economic Development 25 points 25 points 25 points 25 points Do only 4 codes each out of 25points = 100 TOTAL 100

63 PSCC & COGP: Code 800 ELEMENT Companies (Big Companies) Qualifying Small Enterprise (QSE) Micro Enterprises (EME) CODES OF GOOD PRACTICE Revenue QSE exceeding R35M Turnover R5M-R35M Turnover R5M and below PROPERTY SECTOR CODE QSE Revenue exceeding R35M Estate Agents/Brokers Turnover/Rev R2.5-R35M Services Based R5M-R35M Asset Based Net Assets R30M-R280M Turnover R5M and below/r2.5m-r5m

64 QSE Threshold ASSET BASED SERVICE BASED ESTATE AGENTS/ BROKERS QSE enterprises whichever is higher NET ASSETS R30M-R280M GROSS INCOME OR TURNOVER R5M-R35M R2.5M-R35M

65 EMPLOYMENT EQUITY Code 300 CATEGORY MEASUREMENT CATEGORY & CRITERIA WEIGHTING POINTS COMPLIANCE TARGET Years 6-10 Property brokers/ Estate agents Black practitioners as % of total practitioners using the adjusted recognition for gender Black people in Management as % of total Management using the adjusted recognition for gender 11 50% 11 35% Black women in management as a total of management 3 18% 15 points

66 THANK-YOU Questions? Website: Inquiry info@propertycharter.co.za My portia@propertycharter.co.za Office: Cell: