Over the last couple of years, South African inner-cities went
through an extended period of decline. While businesses relocated
to newer parts of the cities, inner-citieswere left with growing
population numbers which resulted in overcrowding and illegal
occupationof buildings. The central-business district (CBD) of
Johannesburg especially has experienced the migration of big
corporations to safer areas north of the CBD. According to
Johannesburg executive mayor Amos Masondo’sreport on the
2000-2005 mayoral term of office, launched late last month,
business’s preference foroffice space in the northern suburbs
is reflected in office vacancy rates. In Sandton and Midrand it
averages around 8%, compared to an inner-city vacancy rate of
around 23%. However, the report also says that some business
decided not to move out of the inner city and that the city is
currently experiencing a positive influx of businesses in its CBD.
It is stated that the formal business sector in the inner city of
Johannes-burg remains significant, with 8 700 formal businesses,
comprising a turnover of R87-billion, which are still located in
the inner city.
The South African Property Owner’s Association estimated that the inner-city still boasts around 2,15-million m2 of prime-gradeoffice space, compared to 1,06-million m2 in Sandton.
Johannesburg inner city is also a major transport hub with around 800 000 people commuting through, while a normal week-day can hostan average of a million people. Currently, official statistics put the residential inner city population at around 230 000.
The inner city of Johannesburg, embracing the CBD and Braam-fontein and residential areas, such as Yeoville, Bertrams, Troyeville, Jeppestown, Fordsburg, Pageview and Vrededorp, has been suffering decaying residential buildingsbecause of a lack of reinvestmentand maintenance, overcrowding and illegal occupation, followed bysocial problems, such as high levels of crime and poverty.
Given the fact that there is little land for greenfields developments, the city is strongly focusing on brownfields projects.
Freeing up distressedbuildings
However, reinvestment and maintenance are issues being tackled by the City of Johannesburg Property Company (JPC) and the Johannesburg Development Agency (JDA) through a Better Buildings programme, which aims at freeing up distressed buildings forredevelopment.
The programme aims at refurbishing up to a thousand buildings over a period of three years.
Buildings that are being identified as ‘bad’ buildings – if the amount of arrears owned in rates exceeds the market value – will be refurbished. The programme, which previously only focused on high-density buildings in Hillbrow, Berea, Joubert Park and the CBD, will also now include the Greater Ellis Park Precinct.
Greater Ellis Park Precinct
This project will entail a revamp of the Greater Ellis Park Precinct to attract investment to the area in order to successfully market it as a place that is ready to host the 2010 soccer World Cup.
The project will see the business offices and commercial and light industrial areas in Doornfontein, Troyeville and Lorentzville also being given a facelift. Neighbouring residential areas have also beenincluded. The City of Johannesburg,through its utilities, agencies and corporate entities is expected to provide over R500-million to upgrade engineering services andinfrastructure. However, the private sector is expected to contribute over R800-million. The rest of the funding will be sourced from donors, the South African Railway Commuter Corporation and Intersite.
JDA is an agency of the Johan-nesburg City Council, which supports area-based economic development initiatives throughout the Johannesburg metropolitan areain support of Jo’burg 2030 – avisionary plan that aims to boost investment and raise economic growth, turning Johannesburg into a world-class African city.
JDA marketing and communications executive Tshepo Nkosi tells Engineering News that the company already completed the regeneration of Jeppestown, Faraday, Metro Mall and the Main street area. It has now targeted Braamfontein, Randburg, Greater Ellispark, Soweto, Jewel City, Fashion district and its main focus area – Newtown.
Randburg regeneration
A joint effort by the city and the local business community has led to the birth of a number of development projects currently being run in the Randburg area. The project aims at developing Randburg as an attractive and vibrant mixed-use node, particularly focused on increasing and enhancing this area’s role as a public-transport node and centre for small business. Among other things, this project includes upgrading the physical infrastructure of the area’s CBD. It is expected that the upgrade will reduce vacancy levels, which, between 2000 and 2003, posted the fastest-growing vacancy rates compared to nodes such as the Johannesburg CBD, Sandton and Rosebank.
Johannesburg’s cultural hub
The JDA is also involved in creating a cultural hub for Johannesburg by investing in regeneration programmes in Newtown. The public sector has already invested around R300-million in re-establishing Newtown as a cultural hub, to increase the range of cultural attractions in the area and toleverage investment into the area. In the process of public investment, an environment and infrastructure platform for private sector investment has also been created. Private sector investment iscrucial to the success of Newtown’s development and it is for this reason that the land release process has been structured to encourage investment and development aligned with the Newtown vision. The Newtown Urban Design Frame-work, developed by the JDA andapproved by the City of Johan-nesburg, identified a need for aflexible indoor venue that will complement the existing large outdoor events on Mary Fitzgerald Square and smaller event and exhibition facilities available at Bassline, Museum Art and the Bus Factory. The Transport House in Newtown has been identified as a venue for this purpose. The City of Johannesburg Property Council (JPC) is currentlyseeking proposals for the develop-ment of the 9 867 m2 Transport House to accommodate a wide range of popular events, such as exhibitions, flat floor sports and concerts. JPC is expecting to award tenders in May. Newtown has already attracted big corporate companies, such as mining giant AngloGold Ashanti, which is relocating its corporate head office to the area. The mining house will move into the historic Turbine Hall, whichillustrates the industrial architecture of the 1920s and 1930s. Construction on this R200-million development has already started.
Nkosi also highlights the fact that JDA recognises the need for residential property in an area as it ensures critical mass and sustain-ability. Newtown currently hoststhe Johannesburg Housing Com-pany’s Brickfields estate.
Rezoning Constitutional Hill to a suburb The Johannesburg executive mayor report on the 2000-2005 mayoral term of office also highlighted some other projects undertaken to ensure the rebirth of the inner city of Johannesburg. One of these is the investment in the Constitution Hill project,located in Braamfontein, which aims at bringing the heritage site intoviable and sustainable economicuse. This development, which is expected to be completed by the end of 2007, comprises 95 000 m2 of publicly-owned land and houses the Constitutional Court. It is now also in the process of being rezoned to become a suburb, which will be registered at the deeds office as a new suburb, neighbour-ing Braamfontein and Hillbrow. It is speculated that this site might be used either to erect luxury apartments or to build a luxurious hotel, which could host high-profile guests, such as judges, who visit the Constitutional Court.
Property availability squeeze
Although upgrades will be rolled out soon, the 2005 Trafalgar Inner City Property report indicates that a strong demand and little property development in Johannesburg’s inner city are causing a squeeze on availability. This is pushing upprices and is making tenants more aware of competition for units. The regeneration of the inner city may see prices of sectional title units in Hillbrow soar to R100 000 within the next three years, analysts say in the yearly report. It also indicated that the strongest demand for property in the Johannesburg inner city still comes from investors looking to buy an entire building, as opposed to buyers looking to purchase residential buildings, apartments and housesin the inner city. However, both local and foreign investors are currently investing in a number of blocks of flats which are being upgraded to offer a new lifestyle of apartments, restaurants, valet parking, room service, gymnasiums and fully-equipped communication and business centres. Trafalgar’s Johannesburg inner-city portfolio comprises around 2 500 rental units and, compared with the average 100 leases a month being signed a year ago, the report says that about 140 leases are being signed monthly. It is a portfolio which has a vacancy of less than five per cent. Johannesburg’s inner-city regeneration scheme is protecting its asset base. Nkosi notes that it will cost R30-billion to reconstruct the inner city’s infrastructure, which is attracting businesses and thereby improving the quality of the city’s residents. Revamping the city will enable it to meet the 2030 goal. It will assistJohannesburg in becoming a world-class city – the ‘New York of Africa’.
The South African Property Owner’s Association estimated that the inner-city still boasts around 2,15-million m2 of prime-gradeoffice space, compared to 1,06-million m2 in Sandton.
Johannesburg inner city is also a major transport hub with around 800 000 people commuting through, while a normal week-day can hostan average of a million people. Currently, official statistics put the residential inner city population at around 230 000.
The inner city of Johannesburg, embracing the CBD and Braam-fontein and residential areas, such as Yeoville, Bertrams, Troyeville, Jeppestown, Fordsburg, Pageview and Vrededorp, has been suffering decaying residential buildingsbecause of a lack of reinvestmentand maintenance, overcrowding and illegal occupation, followed bysocial problems, such as high levels of crime and poverty.
Given the fact that there is little land for greenfields developments, the city is strongly focusing on brownfields projects.
Freeing up distressedbuildings
However, reinvestment and maintenance are issues being tackled by the City of Johannesburg Property Company (JPC) and the Johannesburg Development Agency (JDA) through a Better Buildings programme, which aims at freeing up distressed buildings forredevelopment.
The programme aims at refurbishing up to a thousand buildings over a period of three years.
Buildings that are being identified as ‘bad’ buildings – if the amount of arrears owned in rates exceeds the market value – will be refurbished. The programme, which previously only focused on high-density buildings in Hillbrow, Berea, Joubert Park and the CBD, will also now include the Greater Ellis Park Precinct.
Greater Ellis Park Precinct
This project will entail a revamp of the Greater Ellis Park Precinct to attract investment to the area in order to successfully market it as a place that is ready to host the 2010 soccer World Cup.
The project will see the business offices and commercial and light industrial areas in Doornfontein, Troyeville and Lorentzville also being given a facelift. Neighbouring residential areas have also beenincluded. The City of Johannesburg,through its utilities, agencies and corporate entities is expected to provide over R500-million to upgrade engineering services andinfrastructure. However, the private sector is expected to contribute over R800-million. The rest of the funding will be sourced from donors, the South African Railway Commuter Corporation and Intersite.
JDA is an agency of the Johan-nesburg City Council, which supports area-based economic development initiatives throughout the Johannesburg metropolitan areain support of Jo’burg 2030 – avisionary plan that aims to boost investment and raise economic growth, turning Johannesburg into a world-class African city.
JDA marketing and communications executive Tshepo Nkosi tells Engineering News that the company already completed the regeneration of Jeppestown, Faraday, Metro Mall and the Main street area. It has now targeted Braamfontein, Randburg, Greater Ellispark, Soweto, Jewel City, Fashion district and its main focus area – Newtown.
Randburg regeneration
A joint effort by the city and the local business community has led to the birth of a number of development projects currently being run in the Randburg area. The project aims at developing Randburg as an attractive and vibrant mixed-use node, particularly focused on increasing and enhancing this area’s role as a public-transport node and centre for small business. Among other things, this project includes upgrading the physical infrastructure of the area’s CBD. It is expected that the upgrade will reduce vacancy levels, which, between 2000 and 2003, posted the fastest-growing vacancy rates compared to nodes such as the Johannesburg CBD, Sandton and Rosebank.
Johannesburg’s cultural hub
The JDA is also involved in creating a cultural hub for Johannesburg by investing in regeneration programmes in Newtown. The public sector has already invested around R300-million in re-establishing Newtown as a cultural hub, to increase the range of cultural attractions in the area and toleverage investment into the area. In the process of public investment, an environment and infrastructure platform for private sector investment has also been created. Private sector investment iscrucial to the success of Newtown’s development and it is for this reason that the land release process has been structured to encourage investment and development aligned with the Newtown vision. The Newtown Urban Design Frame-work, developed by the JDA andapproved by the City of Johan-nesburg, identified a need for aflexible indoor venue that will complement the existing large outdoor events on Mary Fitzgerald Square and smaller event and exhibition facilities available at Bassline, Museum Art and the Bus Factory. The Transport House in Newtown has been identified as a venue for this purpose. The City of Johannesburg Property Council (JPC) is currentlyseeking proposals for the develop-ment of the 9 867 m2 Transport House to accommodate a wide range of popular events, such as exhibitions, flat floor sports and concerts. JPC is expecting to award tenders in May. Newtown has already attracted big corporate companies, such as mining giant AngloGold Ashanti, which is relocating its corporate head office to the area. The mining house will move into the historic Turbine Hall, whichillustrates the industrial architecture of the 1920s and 1930s. Construction on this R200-million development has already started.
Nkosi also highlights the fact that JDA recognises the need for residential property in an area as it ensures critical mass and sustain-ability. Newtown currently hoststhe Johannesburg Housing Com-pany’s Brickfields estate.
Rezoning Constitutional Hill to a suburb The Johannesburg executive mayor report on the 2000-2005 mayoral term of office also highlighted some other projects undertaken to ensure the rebirth of the inner city of Johannesburg. One of these is the investment in the Constitution Hill project,located in Braamfontein, which aims at bringing the heritage site intoviable and sustainable economicuse. This development, which is expected to be completed by the end of 2007, comprises 95 000 m2 of publicly-owned land and houses the Constitutional Court. It is now also in the process of being rezoned to become a suburb, which will be registered at the deeds office as a new suburb, neighbour-ing Braamfontein and Hillbrow. It is speculated that this site might be used either to erect luxury apartments or to build a luxurious hotel, which could host high-profile guests, such as judges, who visit the Constitutional Court.
Property availability squeeze
Although upgrades will be rolled out soon, the 2005 Trafalgar Inner City Property report indicates that a strong demand and little property development in Johannesburg’s inner city are causing a squeeze on availability. This is pushing upprices and is making tenants more aware of competition for units. The regeneration of the inner city may see prices of sectional title units in Hillbrow soar to R100 000 within the next three years, analysts say in the yearly report. It also indicated that the strongest demand for property in the Johannesburg inner city still comes from investors looking to buy an entire building, as opposed to buyers looking to purchase residential buildings, apartments and housesin the inner city. However, both local and foreign investors are currently investing in a number of blocks of flats which are being upgraded to offer a new lifestyle of apartments, restaurants, valet parking, room service, gymnasiums and fully-equipped communication and business centres. Trafalgar’s Johannesburg inner-city portfolio comprises around 2 500 rental units and, compared with the average 100 leases a month being signed a year ago, the report says that about 140 leases are being signed monthly. It is a portfolio which has a vacancy of less than five per cent. Johannesburg’s inner-city regeneration scheme is protecting its asset base. Nkosi notes that it will cost R30-billion to reconstruct the inner city’s infrastructure, which is attracting businesses and thereby improving the quality of the city’s residents. Revamping the city will enable it to meet the 2030 goal. It will assistJohannesburg in becoming a world-class city – the ‘New York of Africa’.
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Edited by: Mariaan Webb
Creamer Media Deputy Editor Online
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