ARTICLES – Cape Town CBD

Central CT regenerating

Article By: Angelique Ardé

Tue, 05 Feb 2008 15:55

Its occupants are the first to agree that it is by no means the best-looking building in town, but what Media24 employees can boast is a canteen with spectacular views of the MotherCity.

From the north-facing side of the top floor of the Naspers building in Heerengracht, the view embraces the Cape Town foreshore, the International Convention Centre and the Victoria & Alfred Waterfront towards RobbenIsland and Bloubergstrand.

The south-facing side oversees the city centre and City Bowl stretching to the foot of TableMountain, while District Six and Woodstock lie to the east and Bo-Kaap and Green Point to the west.

Yet, most critical from this vantage point are the cranes lugging concrete through Cape Town’s landscape, bringing to reality a city under construction. You can almost smell the money.

R24-billion will be pumped into the CBD in the next three to five years.

Cape Town Partnership CEO Andrew Boraine says in the past seven years the cumulative investment into the city centre has touched R14-billion while another R24-billion is scheduled to be pumped into the area in the next three to five years.

A sizeable chunk of this capital expenditure will develop public infrastructure ahead of the country’s hosting of the World Cup Soccer in 2010 with projects including the Cape Town station refurbishment, station precinct redevelopment and a R500-million upgrade to the electrical infrastructure.

Upgrades to Grand Parade, Greenmarket Square and St Andrew’s Square are also in the pipeline while the parliamentary precinct is facing a multi-billion-rand redevelopment that encompasses a hotel, convention centre and parliamentary village in the traditional central business district.

However, Boraine says it is the office and retail accommodation investment that has generated the highest levels of excitement. Likening it to 'experiencing a retail revolution', he says the residential drive peaked at 3500 inner city apartments and the pendulum has returned to office accommodation.

Despite healthy rentals of R115-120 per m² for A-grade office accommodation, vacancies are negligible at three to four percent. The R600-million expansion to the International Convention Centre is the latest project unveiled and involves demolishing the old Customs House on Table Bay Boulevard to add another 10000m² of exhibition space, more office accommodation and a potential hotel site. Boraine believes hotels will continue the accommodation trend with another 10 to 12 hotels expected to come on-stream. Yet, these developments are not happening in isolation and other big projects underway or on the cards include:

  • The R2.2-billion investment into the Strand on Adderley Street as office and retail developments.
  • The R500-million Golden Acre upgrade.
  • Mandela Rhodes Place phase three.
  • Significant new developments in Woodstock, Green Point and Kloof Street.

The inner city has attracted strong international investor interest.

Boraine says Cape Town generally and the inner city specifically has attracted strong international investor interest from the Middle East, India, Ireland and Germany.

“However, this picture of prosperity is a far cry from five years ago when the city was experiencing capital flight, rising crime rates and a general lack of confidence. It is like chalk and cheese,” Boraine says, attributing the city’s reversal of fortunes to several initiatives aimed at making Cape Town safe and clean as well as raising public awareness.

He credits the strong partnership between the public and private sectors for being the key success factor. In the past seven years, the two parties have met monthly, effectively building trust between the role players and achieving levels of confidence across a host of issues.

Boraine clarifies it is not just private sector-led development. There has been vital public sector input and more than 300 kilometres of fibre optic cable will be laid in the next three years in a move expected to reduce the cost of doing business.

“We need the public sector,” he says. The reality is the government has benefited significantly from the inner city rejuvenation. Collectively the City of Cape Town, provincial and national governments own around 40 percent of the properties in the area and these properties have experienced an exponential increase in value.

Yet, despite the obvious benefits of inner city revival, urban designer Jacques Theron expresses scepticism shared by many local residents. “I am not sure a flood of money to the central business district (CBD) is the way to go. The biggest problem with (South African) cities is that we are not changing the flows of people,” he says.

The greater majority still utilise private transport into the CBD for work, meaning those living outside the inner city waste more than an hour travelling to and from their place of employment.

“From an urban design point of view, we need development outside the CBD in Bellville and Claremont,” Theron says.

Theodore Yach, a Cape Town Partnership founding member and Central City Improvement District chairman, emphasises the city is ‘still in early days’. Cape Town has only invested 10 years into a 30-year strategy with the long-term objective being to create an environment in which people can work and play.

"Let's add more people."

“Our mantra is: Let’s add more people,” he says.

Yach says the Partnership is engaged in high-level discussions to bring low-cost housing into the CBD with Culemborg mooted as a potential suburb for providing affordable accommodation to between 40000 and 50000 people.

Currently 70000 people live in the City Bowl/CBD/Bo-Kaap area, but doubling that figure will introduce economies of scale and encourage people to walk rather than drive to work.

City of Cape Town acting development co-ordinator Kendall Kaveney says while many people clamour for a piece of Cape Town, the city fathers have realised the need for a co-ordinated development approach.

Borrowing from the best practice principles used by Kagiso Urban Management when Sandton underwent its revival several years ago, the city is compiling a set of agreements to consider every aspect of the impact proposed developments will have on city infrastructure.

“Presently, we do not have coherent, long-term maintenance strategies for possible inner city infrastructural upgrades. Rather, we have a range of departments and they have not been talking to each other about development,” he says.

He believes this project will address this issue by bringing to fruition a project-definition report and steering committee and by December the city aims to have a set of guidelines and principles that developers can use when building in the city.

Trafalgar Inner City Report

CT high-rise selling fast

Article By:

Tue, 04 Nov 2008 15:22

An artist's impression of The Pepper Club

Article By:

The Pepper Club, touted as the hottest address in Cape Town, will forge an unique investment opportunity together with a burgeoning new lifestyle trend in the CBD. This sophisticated Long Street development, due for release in 2009, offers private as well as corporate investors a chance to get their piece of the very trendy pie that Cape Town’s city centre has become.

Set on an entire block between Long and Loop Street, this unique investment boasts panoramic views of the best that Cape Town has to offer. It's part of the vibrant Long Street life and a short drive away from the V&A Waterfront, cable car, many world famous beaches as well as offering easy access to transport routes headed for the Winelands. This development not only offers an affordable yet sophisticated physical asset for first-time investors, but also allows tenants to experience first-world exclusivity in an exciting, cosmopolitan environment.

Luxury amenities of a top hotel

The development, a 20-storey tower with 250 apartments, boasts all the important luxury amenities of a top hotel including a state of the art fitness centre, laundry and cleaning services, swimming pool and sun-deck, private movie theatre, 24-hour security, undercover parking and a concierge to attend to your every indulgent need.

“Recent development trends have seen the conversion of old office blocks into apartment complexes. The Pepper Club is unique in that it moves away from this trend to redefine the notion of elite apartment living with the construction of a brand new high-rise, with state of the art amenities and finishes, to lift the standard to a level not previously seen,” says David Solomon, chairman of Solomon Brothers Property Holdings.

At a time when investment potential in the property industry is hard to find, the launch of The Pepper Club development might just be the opportunity for savvy, young investors to gain a strong financial asset that promises both growth as well as the premium lifestyle that this up-and-coming jet-set have come to expect of the Mother City.

As an investment, the apartments are leased out on short-term lets, which allows for a projection of positive cash flow revenue from day one. The developers guarantee an interest rate of prime minus five percent on the mortgage finance, making it easier to own an income generating asset in the soul of modern downtown Cape Town.

The Pepper Club has also come along at the right time. With popular financial press stating that we are reaching the top of the interest rate cycle, it is a good time to buy, as property prices are expected to rise in the near future. “Its proximity to important tourist landmarks, beaches and shopping centres, as well as the Greenpoint stadium, puts it in the ideal position to take advantage of the major anticipated shortage of accommodation for the 2010 World Cup,” enthuses Solomon.

20 percent of the apartments sold within the first week

Solomon revealed that 20 percent of the apartments sold within the first week. "This clearly demonstrates the value and popularity of this unique investment opportunity. Each apartment features the very best of exclusive contemporary finishes with granite kitchen tops, plasma screen televisions, air-conditioning, plate-glass windows and balconies allowing for panoramic views over the city.”

There is an exclusive shopping mall on its ground level which will include the likes of health, beauty and other speciality stores. Coffee shops, fine dining restaurants and bars will spill over onto the best of night life, café culture, boutiques and antiques that Long Street has to offer.

Apartments range from studios of 34m² to luxurious penthouses of 400m² with prices ranging from R799000 to R16.5-million.

The hottest address in CT

Article By:

Wed, 10 Dec 2008 07:19

There is no time like the present to invest in Cape Town city centre living. Due to a weak South African property market there are a number of extremely affordable options currently on the market in central Cape Town, ranging from studio apartments to luxurious penthouses. When the market turns, however, expect values in the Central Business District (CBD) to skyrocket.

Safe, clean city living

Cape Town's city centre has famously regenerated and offers an unparalleled lifestyle to its trendy residents. It is a very different story today from five years ago, says Pam Golding Properties MD for the Western Cape metro region, Laurie Wener. "In the past five years crime in the CBD has dropped by 60 percent and the area has undergone a significant facelift," she says. "Billions of Rands have been invested in residential densification and there have been huge improvements in the overall cleanliness of the city. Plans are now underway to improve the internal transport network within the Central City including the upgrade of Cape Town station, the introduction of the new Bus Rapid Transport System and decentralised multi-storey parking garages allowing for a park and ride system as well as investment in pedestrian and cycling zones throughout the city. Money is also being spent upgrading public spaces such as the Grand Parade and Church Square and updating the Golden Acre shopping centre.

"The chief executive of the Cape Town Partnership, Andrew Boraine, indicated late last year that there was between R28-billion and R30-billion worth of new private and public sector investments planned for the Central City over the next three to five years. All these projects will have a significant impact on the area and can only improve the prospects for capital growth for property owners."

Electric, cosmopolitan atmosphere

The Central City area is now home to over 30 residential developments including apartments, townhouses, penthouses and smaller studios. It also boasts an eclectic collection of fashionable restaurants, coffee shops, internet cafes and designer boutiques scattered among its modern office blocks and historical facades. Buyers in this area to date have included a mix of full-time city residents, Gauteng-based commuters and some foreigners and the result is a character-filled environment with an electric, cosmopolitan atmosphere – the perfect place for young professionals to live, work and play.

PGP’s area manager for the Atlantic Seaboard and City Bowl, Basil Moraitis, says entry level prices in the Central City now stand at their most affordable level in years. "Current prices represent great opportunities for young professionals wishing to live close to work and close to the buzzing city nightlife," says Moraitis, "and also for investors wishing to take advantage of the slowdown in the market and buy at the most affordable levels in years, then earn rental income. There is a strong and consistent demand for rental properties in the city, both on long- and short-term lets, and from a variety of sources. For example, we see parents of students seeking rentals (and purchases) in the affordable buildings close to the Cape University of Technology campus while businesspeople tend to prefer the developments situated close to the Cape Town International Convention Centre and key office buildings. For tourists, proximity to the V&A Waterfront is a key factor as well as ease of access to transport and other leading tourist attractions. Investment buyers can also opt to purchase an apartment and rent it out, furnished, on a daily basis via the many developments offering a rental pool such as Fountains Suites, Icon, Circa and Mandela Rhodes Place. Our City Centre rental agent is exceptionally busy at the moment letting both furnished and unfurnished apartments in the city, many of them to foreign visitors. With the depreciation of the Rand we are definitely seeing renewed foreign interest in this market."