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Investors only have until 30 June, 2021, to take advantage of the generous tax deductions available by investing in a Section 12J Fund. And by making that investment into the Lucid 12J Retirement Living Fund offered by venture capital specialist, Lucid Ventures, you not only enjoy the tax break, but you also benefit from a solid investment with outstanding long-term growth potential.
While time is running out for investors who want to take advantage of the Section 12J tax breaks, Gidon Novick, founder of Lucid Ventures, emphasises the importance of not rushing into just any Section 12J fund to beat the deadline. Instead he advises the same level-headed approach that a discerning investor would normally take when contemplating any investment opportunity – including rigorous due diligence, and careful consideration of all the factors that typically make up a good investment proposition.
Novick, who is a former CEO of Comair and Discovery Vitality and the founder of two successful airlines, Kulula.com and Lift, urges investors to also ensure that the investment they choose offers the potential for good long-term returns that will continue long after the Section 12J tax incentive has closed.
“While the Section 12J incentive offers a significant saving on tax, it’s worth noting that this is a once-off rebate in the year of the investment,” he explains, “so funds that have based their investment proposition solely on the 12J benefit, and little else, don’t necessarily provide a compelling long-term value proposition.”
Instead, Novick advises prospective investors to fully interrogate the Section 12J investment opportunities they are considering on a number of other essential criteria that, if met, could deliver far more value than just the once-off tax rebate. And he cites the Lucid Ventures Section 12J investment offering, known as the Lucid 12J Retirement Living Fund, as a good example of this combination of tax breaks and proven investment growth fundamentals. The first of which is a robust asset underpin.
The Lucid 12J Retirement Living Fund opportunity is built on prime real estate developments, located in high-value areas. Land parcels for the first two of these developments has already been purchased in the sought-after Houghton and Rosebank suburbs in Johannesburg, and the planning for the buildings has been finalised.
“A strong asset underpin is a tried and tested store of investor value,” Novick explains, “and when those assets are properties with high-end buildings on them, that value element is compounded over time, while also serving as a useful buffer against market and economic volatility.”
Novick also emphasises the importance of selecting an investment in a sector that has a proven track record and a clear long-term growth path. “With over 5 million South Africans over the age of 60 – expected to grow to around 9 million by 2040 – the retirement lifestyle industry is a fantastic investment opportunity,” he says, “and the Lucid 12J Retirement Living Fund has been designed to tap into this burgeoning sector with its high potential for competitive, potentially indefinite returns.”
Novick explains that the premium retirement living facilities developed via the Lucid Fund have been designed to stand out within this sector by offering retirement living and care facilities with a hospitality focus. “These modern and technologically advanced facilities are set to revolutionise the way people think about, and experience, retirement lifestyles,” he says, “offering the flexibility of a living unit for life that is designed to adapt to the changing needs of residents as they advance through their retirement years.”
And Novick has already assembled an enviable team of experts to manage, and extract maximum value from, the Fund and its planned developments. Joining him on the investment management side are Leor Atie, co-founder of very successful Saicom, and Leonard Fine, who has more than 60 years’ business and private equity experience. Between them, this vastly experienced investment team already manages a portfolio with assets in excess of R400 million.
The design, development and construction component of the Lucid offering is also managed by a vastly experienced team of property development and construction professionals, including Andrew Kuming, who founded the prestigious Kuming & Staples and is also a director of Lucid Ventures, as well as the highly experienced architect, Julian Katz.
Furthermore there is a hospitality leadership team in place that will oversee the operations of the Lucid 12J Retirement Living Fund facilities when they have been complete and opened to residents. Corene Breedt and Michael Sieff are the co-founders of the very successful premium retirement living management and consultancy firm, SilverAgE, and they have already begun to apply their many years of experience in the field to designing a retirement living experience that will undoubtedly become the benchmark of quality for the industry in the coming years.
“While the Lucid 12J Retirement Living Fund gives investors access to the tax deductions offered through this structure, this fund is first and foremost a solid investment opportunity,” Novick says, “and we are absolutely confident that it will deliver real returns over time that will extend, and even far exceed, the value of the initial 12J tax deduction.”
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