October 11, 2005
By Lucille Davie
THE rejuvenation of Gandhi Square is being finalised with the creation of an arcade from the square through to Marshall Street.
The square, revamped in 2002, was part of developer Gerald Olitzki's broader plan to develop a west-east spine across the central CBD, a contribution to the renewal of the inner city.
Formerly an untidy bus terminus, it has been transformed into a leisurely piazza where restaurants and fast-food outlets spill out on to the open area; tables, chairs and bright umbrellas provide welcome sit-down-and-relax places for office workers. Buses still pass through the square, but make a quick stop and move on.
The retail space created in the arcade was let within days, says Olitzki. Tenants include an optometrist, a pharmacy and a cobbler. It is scheduled to open in a month.
The row of fast-food outlets and restaurants along the southern edge of Gandhi Square
"The arcade will be like a bypass operation, feeding new blood into Marshall Street," he says.
Marshall Street, a block south of the square, has a rundown air to it, exacerbated by the shell of the Marshall Street Barracks, directly opposite the exit of the arcade.
The derelict barracks was gutted by fire in October 2002. The building, built in 1913 and used by the Transvaal Scottish Regiment, was vacated in the mid-1990s and subsequently occupied by vagrants and hawkers. It is owned by the Department of Public Works.
Above the entrance to the arcade is a long balcony, already taken by a restaurant. The aim is to create a beer garden overlooking the square. This will be complete in time for Christmas, Olitzki says.
A major step in creating the spine was to pedestrianise and green Main Street, from West Street in the west, through to Gandhi Square. The last section of Main Street leading on to the square was recently paved and greened, completing the spine.
The blocks beyond the square, until Polly Street in the east, are still to be pedestrianised. This will be done by Transnet and Absa, whose offices are in this section of Main Street.
Demand for space
Olitzki owns the six buildings along the southern edge of the square, and has transformed them from rundown, squatter buildings to A-grade office accommodation.
He has a policy of renaming the buildings he owns, and the building on the south-western edge of the square, formerly Burlington House, has been renamed Umoya (winds of change).
"This building housed about 3 000 squatters, who had open fires on the floor, with loose wiring hanging from the walls," Olitzki says.
The developer bought the building from its slumlord owner, cleared the squatters and now has a building with 3 000mē of office space, all leased.
"There is massive demand for retail and office space," he says. The ground level of Umoya, on the square, is filled with tenants - a mix of fast-food outlets, a Spar, ATMs and credit agencies.
The building in which he has offices, on the corner of Loveday and Main streets, is nearing completion. Previously called Maritime House, Olitzki has renamed it Kuyasa (or dawn) House.
He has created two levels of 300 parking bays on the first and second floors, incorporating the other buildings on the block. Bram Fischer House, which he also owns, now houses a sit-down Nando's on one corner, and will soon be rented to Café Fino, a new branch of News Café.
Jump in prices
Olitzki says there has been a marked jump in the price of buildings in the CBD. Five or six years ago he bought buildings at R150 a square metre, with costs of R350 a square metre to renovate. Now buildings sell at R500 a square metre, with a jump in renovation costs to R500 a square metre.
He has also been approached with offers from buyers for his renovated buildings at R3 500 a square metre, but has refused them. "The replacement cost of these buildings is R8 000 to R9 000 a square metre, which is the breakeven point. It would be silly to sell, having taken the pain."
Return of companies
Olitzki sees a trend of high-end companies returning to the city, after the previous decade's exodus from the CBD. It is a reflection of the new South Africa, he says, that companies are now drawing staff not from the northern suburbs but from Soweto, Alberton and surrounding suburbs.
"Businesses want a broader spectrum from which to draw staff," he explains.
Those returning to or setting up divisions in the city are attorneys, financial institutions and information technology companies.
And employees are taking advantage of the trend, says Olitzki. Previously they would have come into the CBD and continued their journeys further north to work. Now they don't have to travel out to the north; they can look for jobs in the CBD.
Another factor is the difference in rentals. Although Olitzki admits that the northern business nodes will never die, rentals in Sandton are about R90 a square metre, compared with R25 a square metre in the CBD.
Returning to Gandhi Square, his other ambition was to encourage night life in the area. Several restaurants have applied for liquor licences, and with parking under the square, there will be no excuse for not staying for after-work drinks in the CBD.
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