One of JHC’s most significant achievements is that it has reached a position of financial sustainability while it has succeeded, too, in fulfilling its social mandate. Operating within a framework of sound governance and strict business principles it has achieved its defined financial and social objectives.
When JHC was conceived it had few models in the South African context to work from. With an initial capital grant of R50 million from the European Union and further funding from the Flemish Government, JHC has been able to grow its asset base to establish a balance sheet currently valued at R700 million (YE June 2012), comprising debt, equity and grant funding.
It has a steady rental income stream of now over R100 million a year (R132.8 million YE June 2012). Direct expenditure on buildings amounts to about 42% of rental turnover, providing for rates and utilities and building management, security and maintenance. Overhead administration costs amount to just 25% of turnover. While JHC continues to grow its property portfolio and the number of housing units under management annually, staff numbers are contained to optimise performance efficiencies as far as possible.
The company currently has a total staff complement of 70 people. Employment equity is monitored on an ongoing basis and the demographic profile of staff and management is maintained broadly in line with the national profile.
In terms of broad based black economic empowerment (BBBEE) JHC’s business structure and practices are aligned with government’s BEE Codes of Good Practice and the measures defined in the Property Sector Charter. JHC has been especially successful in empowering black-owned emerging enterprises, including local building contractors and building maintenance, security and cleaning services providers.
Since it began operating JHC has made a practice of keeping vacancies, arrears and bad debt at levels which are recognised as exceptionally low in the social housing sector, and in the rental housing sector as a whole. On all these indicators, the company consistently maintains levels at nil or close to nil.
For the year ended June 2012, arrears amounted to -0,07% of total rent billings and vacancies at 2.93% of total residential units.
While strict management practices ensure that these minimum levels are maintained, this achievement is supported by the quality of accommodation and service that JHC provides to tenants.