This SA property company is making a killing selling gravesites, with 'family plots' now going for up to R360,000
- The low-income housing developer Calgro M3 saw a sharp increase in plot sales at its memorial parks across the country.
- Its cemeteries offer high-tech security, free wifi and landscaped gardens.
- At the company's Nasrec Memorial Park, the cheapest grave site costs R24,500.
- For more, go to Business Insider SA.
In the past year year, the property group Calgro M3 saw a 66% increase in revenue from its “memorial parks” - landscaped cemeteries across the country.
Founded in 1995, Calgro launched its first memorial park five years ago, and it now has cemeteries in Fourways, Nasrec, Springs, Bloemfontein and Durbanville.
Sales from its memorial park business increased to R20.9 million in the past year, mainly due to increased sales prices, Calgro M3 said in its latest annual results, released on Monday.
It sold almost 1,500 grave sites in the past year. The company’s memorial parks offer high-tech security, free wifi, landscaped gardens and water features. The sites are lit by streetlights at night.
The cheapest grave plot on offer at the Nasrec Memorial Park Cemetery costs R24,500, which can go up to R48,600 depending on location and gravestone. An 8-plot "family estate" costs R360,000.
Alternatively, you can buy a plaque displayed on a wall for R10,700. For funerals, Calgro also hires out tents (R2,000 for two hours) and a chapel (R3,000 for two hours).
In the past year, Calgro launched payment plans whereby clients can pay over several months at no interest or fees. It is now looking for a partner to develop funeral policies.
The company, which earns the bulk of its income from low-end housing, will now start building memorial parks as part of its resident developments.
Construction on the Witpoortjie Memorial Park (with an estimated 16 000 graves) in Roodepoort, which will be part of the residential estate of the same name, will start next year. The group has also applied for rights to build a memorial park with 22,000 graves at its Fleurhof development in Gauteng, and (estimated 22 000 graves) and at KwaNobuhle (estimated 48 000 graves) in Uitenhage.
South Africa’s largest cities are facing a shortage of available grave sites, as population growth and migration to urban areas puts pressure on both available land and the number of graves needed.
Last year, the City of Johannesburg urged residents to consider alternative burial methods.
Tough times for Calgro
While its memorial parks may be expanding, the company's traditional business is currently under pressure, with revenue down 43% to R997.1 million in the past year.
This was due to working capital constraints and a decline in public spending. In addition, it had to fork out R71 million in security and other costs after land invasions at its Scottsdene and Fleurhof sites. Work on these developments has been disrupted.
Calgro's share price has lost more than 60% of its value over the past year.
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