Harnessing technology to navigate South Africa's property market 

‘Navigating the complexities of South Africa's property market requires a blend of innovative technology and market insights’, writes Myurie Naidoo, Principal of Property Finance, Sustainability, Reporting and Automation at Nedbank Corporate and Investment Banking (NCIB). 

In the ever-changing landscape of South Africa's property market, 2024 presents challenges and opportunities. As the climate crisis escalates, the importance of financial institutions in fostering a sustainable future has reached a pivotal point. 

As the country’s leading commercial property financier, Nedbank is fully aware of these responsibilities. The crucial question is: How does Nedbank use technology and data analytics in such a complex environment? 

Understanding the climate geolocation tool

Physical risk to property assets due to climate change poses a considerable challenge. NCIB’s approach is its cClimate gGeolocation tool, an interactive map that is quickly becoming essential in property finance. This map isn’t just another digital tool; it pulls together data from various sources, giving a complete view of the bank's financed portfolio. At the core of its development was the need to understand properties that are more at risk of climate change due to their location.

Incorporating climate scenario overlays and property risk scores

Nedbank has taken a forward-thinking approach by integrating climate scenario overlays through these climate risk assessment tools. These overlays offer detailed insights into how specific climate events such as floods, wildfires, hail, and lightning could impact the bank’s mortgage portfolios. Each property is given a risk score based on its exposure to these events, allowing for a more nuanced understanding of potential risks.

This data-driven strategy goes beyond merely recognising risks; it enables Nedbank and its clients to address and reduce those risks proactively. By embedding these insights into strategic planning, Nedbank ensures that it remains at the forefront of sustainable property finance in South Africa, enabling the bank and its clients to navigate the challenges that a changing climate poses.

The tool’s functionality was extended to provide essential insights into client concentrations, sector trends and nodal development activity. For development projects, Nedbank partnered with OpenSpace  to provide a value-added service to clients.  

Real-time monitoring with OpenSpace

Nedbank’s partnership with OpenSpace shows how modern technology can change how things are done. OpenSpace’s technology allows for real-time monitoring of construction sites through 360-degree street views, accessible via an app. This isn’t a tech gimmick but a real improvement in project management. 

Real-time tracking allows project teams to resolve issues quickly and ensures stakeholders get timely and accurate updates. Although the adoption of this technology was slow at first, when its benefits had become clear, demand grew. Today, Nedbank is the largest user of OpenSpace technology globally, reflecting its commitment to innovation in property finance.

Leading the way in sustainability in property finance

Nedbank’s commitment to sustainability goes far beyond technological tools. The bank has set up a team of green-accredited experts specialising in the International Finance Corporation’s Excellence in Design for Greater Excellence (IFC EDGE) certification – a globally recognised green building standard. 

This team has already reached significant milestones, such as the certification of Attacq’s Nexus 1 building in the Waterfall precinct. This project spans 7 363 square metres and is South Africa’s first commercial building to achieve EDGE and Green Star certifications. 

Nedbank’s involvement in the Nexus 1 project clearly shows its role as a driver of change in the real estate sector. By promoting resource-efficient construction and strong environmental standards, the bank responds to market demands and leads the industry towards more sustainable practices.

Nedbank’s role in sustainable property finance

For Nedbank, green finance is not just a trend but a core part of its strategy. As the bank continues to grow its in-house expertise and use data analytics, it remains committed to helping clients navigate the complexities of climate change. 

This focus ensures that Nedbank is assisting its clients with today’s challenges and preparing them to thrive in the future. Ultimately, Nedbank’s approach to property finance is about more than managing risks. It is about leading the way towards a sustainable future.

By leading in technological innovation and sustainable practices, Nedbank establishes itself as a responsible and progressive financial institution within South Africa’s property market. Strategic real estate investment not only offers potential financial returns, but also plays a crucial role in promoting environmentally responsible development practices.