Johannesburg — The Cape Town Partnership's four year drive to upgrade the central business district and turn it into a sophisticated inner city residential precinct comparable with New York, London and Dublin is starting to bear fruit.
LOCAL and foreign property developers are snapping up old or under-utilised office blocks in and around Cape Town and turning them into luxury apartments. Old Mutual Properties is in the process of converting Mutual Place, a 63-year-old 18-storey building in Darling Street into a R100m sectional title development and recently added Cartwright's Corner in Adderley Street to the inner city residential market in a R120m project.
Irish investment consortium Eurocape Investments has indicated that it intends building up a substantial portfolio in the Cape Town area. Its West City Precinct project in the St Georges Mall/Wale Street comprises eight buildings that will be converted into a residential and hotel block. Planning for conversion of the offices to apartments, which will enjoy views of Table Mountain, the Company's Gardens or St George's Cathedral, is still under way and construction should start in about three months' time. Completion is scheduled for next year.
Mike Thompson of Nedbank Corporate has welcomed Eurocape's commitment to preserve buildings of historical significance to Cape Town and his group. "They include the premises that housed SA's oldest bank, Cape of Good Hope Bank, established in 1831, and the second oldest financial institution, BOE, and we believe we are leaving them in good hands," he says.
Increased interest in inner city officeto-apartment conversions suggests that estimates of 2000 residents in Cape Town's CBD by 2006 may be conservative. Old Mutual Properties executive director Rowland Chute says: "There are, in our view, three key drivers to the trend in Cape Town: revitalisation of the city, quality offerings and affordability."
The decision to add Cartwright's Corner to its inner city portfolio followed the rapid sell-out of Mutual Place, where 170 apartments were snapped up by local and foreign investors before the conversion started. Apartments in Cartwright Corner range in price between R320000 and R2m for penthouses boasting spectacular views of Table Mountain and Devil's Peak.
Construction of a pedestrian bridge providing easy and secure access to additional parking areas for Darling Street residents has increased the desirability of this lifestyle.
When Mutual Place reaches completion, which is scheduled for October this year, owners will move into a former historical treasure that has been preserved under the watchful eye of a specialist heritage consultant. A variety of one, two and three bedroom suites and rooftop penthouse units, complete with terraces, pools and parking bays, have been designed with quality and tasteful finishes in mind.
Pam Golding Properties Area Manager Laurie Wener says: "Quality expectations of what is emerging as a sophisticated, youngish market are being met. This extends from the level of fixtures and fittings, provision of broadband width internet access and satellite television services in the apartments to accompanying on-site facilities, security and the credentials of the development and marketing team."
Wener says the importance of on-site or nearby facilities for inner city dwellers should not be underestimated.
Recently appointed CE of the Cape Town Partnership Andrew Borraine says: "We need to tackle with a greater sense of urgency the traffic and transport issues that face the city. We're getting closer to reaching our goal of providing a 24-hour city life in Cape Town by focusing on marketing strategies including improved retail and entertainment facilities.
"High quality management of open public spaces is absolutely essential to providing this sought after lifestyle and in this Cape Town is perhaps where Dublin was about 10 years ago. We should learn from them and attract city residents from a broader range of income categories like young professionals with IT skills needed in the advanced services sector, areas to be grown in your economy."
Companies such as Woolworths and Pick & Pay have invested heavily in Cape Town's central business district in the belief that this is justified by an increased number of permanent residents.
Woolworths has a full-line store in St George's Mall, offering the chain's complete range of clothing, home appliances and food. The Pick & Pay store is a franchise operated by partners Nawal Ramasar and Tony Godfrey, who say the project was considered viable because the central business district has become a hub of activity, including "the steady trend of growth in South African tourism and 180000 commuters entering the city on a daily basis".
"For inner city apartment living to be sustainable, a genuine market is needed ensuring that larger proportions of residents are owner-occupiers. With foreign tourists becoming more discerning as to the cost of rentals, one should be cautious with expectations of letting easily and making lots of money. There are instabilities in rentals themselves and long term rentals should provide the more secure option," says Borraine.
The Cape Town Partnership is working with a wide range of retailers to help them find suitable premises in the inner city.