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Welcome to The Property Pod, South Africa’s premier property investor podcast. On this weekly podcast show, we gain insider insights from leading executives, analysts, developers and entrepreneurs in SA’s property industry.
We are looking at the ethics, professionalism, and transparency side of the industry on this latest episode. It may seem a bit academic or technical, but it’s an important part of the industry.
The UK-based Royal Institution of Chartered Surveyors – or the RICS – is a global professional body for those working in the built environment, construction, land, property and real-estate sectors. It was founded way back in 1868.
On this week’s podcast show, we are speaking to a familiar name in our local property industry – TC Chetty, who’s the head of partner development and public affairs at RICS in South Africa. TC is a former president of the SA Property Owners Association – quite a while back, in the mid-2000s, when he was working at Moreland.
For people who have a long memory, Moreland used to be the property development arm of Tongaat Hulett, which was listed on the JSE in its heydays (currently suspended).
TC has a master’s degree in town and regional planning from the University of KwaZulu-Natal and has been at RICS for several years. He has also been on a few company boards, including JSE-listed Fortress Reit currently.
Highlights of his interview appear below. You can also listen to the full podcast above or download it from iono, Spotify or Apple Podcasts.
Old Mutual’s Gateway Theatre of Shopping in Umhlanga, north of Durban, sparked the development of the Umhlanga New Town Centre precinct by Tongaat Hullet 25 years ago. Image: Supplied
Highlights
To kick off TC, can you give us some insights into RICS and its history? What does it actually do?
“As you’ve mentioned, the RICS is not new. We’ve been going now since 1868, so some 156 years, and we’ve been growing a market presence across all world regions. Our global presence is growing – I think sitting currently at around 134 000 qualified and trained professionals or trainee professionals globally. So a very well-expanded body around the globe, well respected and one of the world’s leading professional bodies.”
“Historically, surveyors used to refer to quantity surveyors and valuers predominantly as building measurement people mainly in the UK, and we in South Africa I think had difficulty in understanding that term. But that has all changed now and to a point where the membership has widened, where now our members come from almost all of the built-environment professions and associated professions, including architects, engineers, bankers, ecologists, town planners and the like.”
“All of these people and [the] technology have changed to the extent where even valuations are done by flying drones through buildings, virtual-reality models of buildings using big data. So the professions are changing all the time, and I think an organisation like ours really ensures that our professionals remain on the forefront of that.”
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What is your role at RICS in South Africa?
“You touched on it earlier. Officially, I’m the partner development and public affairs manager for the RICS in South Africa. But generally you could read ‘country manager’ for that role.
“That really entails increasing brand awareness of the organisation in South Africa, engaging with various professional bodies in the country, lobbying government around issues of professionalism and standards, and engaging with tertiary education institutions in the country.
“That’s one of our big roles in order to make students, particularly those coming into the built environment, more aware about their responsibilities, and to ensure the future of the professions going forward.”
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You mentioned the number of professionals globally that have some sort of certification from RICS. But in South Africa, how many people are actually linked to RICS in terms of these certifications?
“In South Africa at the moment we have roughly 1 500 members. It fluctuates a little from time to time because some of our people go and work depending on where their firms move them. So some move temporarily to the Middle East, or back to the UK, and come back here. So the membership changes. But on average, about 1 500 overall, with sub-Saharan Africa having about another 1 000, so 2 500 in sub-Saharan Africa. They are recognised by the various statutory bodies in the country.”
“We are recognised here as a voluntary association. A large majority of our members in South Africa work in the construction side of things, mainly QS-ing [quantity surveying], although we have quite a few in valuations.”
“And we’re seeing more and more of an increase in our membership in the real-estate and facilities-management professions. So we are fairly well spread.”
“We have three different types of membership. This is globally, not just in South Africa, where you can become an associate member of the RICS where you might not necessarily have all of the degree qualifications and that, but you have some experience and a certain level of experience, or you can become a member, which is our most popular (category), a standard member, and then a fellowship where you have to have achieved certain things in the industry in order to become a fellow of the RICS.”
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On to the core topic at heart for this podcast. Why are ethics, professionalism and transparency – and I could even add training to that in terms of the property sector – so important in your view?
“It was a lot easier a while back. A few decades ago, it was possible pretty much for each jurisdiction or country or region to have their own standards and ways of doing things. But with globalisation and the way the world operates these days, market efficiency requires much more market consistency, transparency, and particularly comparability given multi-locational firms and entities.”
“International standards, we believe, are the backbone of this approach. It’s imperative that everybody is speaking the same language.”
“If you take the analogy of football, for example, football is played around the world, and if everybody was playing the game under different rules, it would just be impossible. And the way we like to see the built-environment sector is everybody playing by the same rules. And what we as the RICS do is we collaborate to set global standards.”
Enforcement
“You talked about training. We train professionals to those standards and then hold them accountable to those standards. That includes enforcement, and we believe in many professional bodies that is lacking, that element of enforcement.”
“We do that really to protect the public interest and to provide a sound platform for that transparency that I mentioned – and therefore sound decision-making in business.”
“Ethics is an integral part of that. It really is what drives trust in our professions and drives confidence.
“But it’s more than that. It’s about respect and responsibility. You need to respect the people that you work with, and you need to accept accountability and responsibility for what you do. So it really is about protecting our members, protecting clients, and protecting the public.”
“In this day and age with corruption, and with more and more legislation coming on around that and money laundering, and around regulations like IFRS [International Financial Reporting Standards] or the valuation standards, I think all of this ties into a common understanding of what we need to achieve and the rules we need to play by.”
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You piqued my interest a little bit there when you talked about enforcement. What do you mean? Enforcement, within the context of you also mentioning earlier that RICS is a voluntary body in South Africa?
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“I mean globally anybody who becomes a member of RICS is held accountable to certain standards. So irrespective of whether you are a member of any other professional body, globally or in South Africa, if you’re a member of RICS and you carry out work, or if you are engaged as a professional and if somebody complains, we have a process whereby the complaint is investigated.”
“If you are found to have contravened either the ethical standards or the standards [by] your conduct for whatever reason or in whatever form, then you are held accountable. There are penalties.”
“You can be dismissed as a member or there may be ways that you have to make reparations.
“But there is enforcement to a point where we ensure that these are not common activities – certainly among our membership. So we rarely, if ever, have to end up enforcing the standards by virtue of the importance people place on our membership.”
Is your RICS role your core focus? Are you involved in anything else in the industry? I did mention some of your board roles earlier.
“I love what I do. Having been in the property sector – I’ve been in it now for over 30-odd years – I still have a passion for what I do. So I’m very fortunate and I learn new things every day.”
“Apart from the RICS role, I remain involved in the industry in a consultancy role, so I consult in development broadly, especially where problems need to be resolved. I seem to have developed a niche for that.”
“You mentioned that I do sit on the board of Fortress and some of their committees. And generally I like to get involved in the sector with students, speaking to students and sharing experiences, and generally to be a mentor to particularly younger people in the industry to share some of my passion and to help other people learn new things.”
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TC, I can’t let you go without asking you this, because people in the industry for a while will know that TC Chetty was at Tongaat Hulett – back in its heydays, one would argue. But considering the fact that you were involved with Tongaat Hulett’s old Moreland division in its heyday … You must be one of those who are sad to see what’s become of the company with Tongaat Hulett Developments not really operating currently, in the context of the broader group being in business rescue?
“Suren, I left there in 2008, so 16 years ago now. It seems not that long ago, but you’re quite right. It’s more than sad what has happened to the company. I think it’s quite tragic, really, what has happened to a once-proud brand, not just for KZN but for the country as a whole.”
“It’s especially sad for me from the property side and with what we achieved as a team. We built that brand over the years. Again, it comes back to what we spoke about earlier, where the brand of Tongaat in those days – not just as a group, and Moreland beyond – did change to sort of Tongaat Hulett Properties and Tongaat Hulett Developments when I was still there for a year or two.”
“But at the end of the day, it comes back to the whole issue around standards and ethics; people had trust in the organisation in those days.”
“If you bought a property from Tongaat you knew what was coming up next to you, and you knew what was coming up around you. Tongaat delivered on what it promised, basically, back then.”
“And somewhere along the line – it’s difficult to pinpoint exactly what happened; I think the ethos changed, the philosophy changed somewhere along the line. And one can’t ignore the fact that there were clearly some significant governance failures both at a properties board or development board level and at a group board level.”
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“It has resulted now in a situation where the property side of the business is completely changed from the level of detail and the level of passion that went into creating places like Zimbali and Mount Edgecombe or the work we did further around the north coast creating the Umhlanga New Town Centre, La Lucia Ridge Office Estate.”
“All of those are flagships; people talk about new urbanism, and they see Melrose Arch as this fabulous development. The fact of the matter is we were doing that kind of thing long before they thought about it …”
“They learned from places like the New Town Centre with the super basement and those kinds of things.”
Zimbali Coastal Resort, near Ballito on the KZN North Coast, was initially spearheaded in the mid-1990s by Moreland, which later became the Tongaat Hulett Developments division. Image: Supplied
“Now we have a company that, from a land perspective, is looking to just sell out as much land as possible without really doing much to it or lease it to other people. It doesn’t have the same control, the same integrity, people who come in now and buy and develop that land …”
“And secondly, [they] probably don’t want to [impart] confidence about what’s coming up around them, or what’s going to be done in the future, the level of service that you were [previously] assured of with Tongaat. So it’s sad.”
“I still talk to some of my colleagues from the old days at Tongaat, and we all agree that it’s a waste of a lot of hard work. It’s sad.”
“Personally, it was sad for me to see what happened to so many of the people I’d worked with who were still there, who in the end ended up having to leave as the business went into business rescue.”
“So it’s really very difficult to comprehend. I hope that the broader group can survive. It seems to be heading in that direction, so fingers crossed. But from the property side, you don’t know what will become of that at this stage. Seemingly, the intention is not really to look at going back into the development side of things – and that is really tragic.”
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TC, one last question before I let you go. Are there any highlights just in terms of your work at RICS coming up that you’d like to share?
“Yes, two items. The one is some work we’ve been doing at the moment. The whole issue around sustainability is key at a global level these days.
“One of the things that we’ve developed as the Royal Institution of Chartered Surveyors recently is a whole-life carbon assessment tool, which really was created to provide a better and further understanding and accuracy regarding carbon costs and the benefits of design choices in the construction and infrastructure projects that are happening.”
“At the moment it’s one of the few standards at that level in the world, and we’ll be promoting that. That was launched literally earlier this year, and we’ll be running a whole series of workshops just to make people more aware of that. It’s already starting to be adopted at a global level. So that will come with tools and so on.”
“And then one of the key things that we are working on, in partnership with the Women’s Property Network coming up, is our Africa Summit. The last time this was held was before Covid in 2019, so we are keen to get that up and running again.”
“It will be held in Sandton on the 19th of June at the Sandton Convention Centre this year. So we are really excited and looking forward to that …”
Listen to the full episode here.
