Neil Fraser
March 23, 2004
I MENTIONED last week that I've found myself recently, for various reasons, on a number of inner city building rooftops. One of these was a fashion show at the launch of Rees Mann's new Afsew Centre in the Fashion District - covered in the last Citichat.
Another was an evening "braai" on the roof of the National Bank Building with Urban Ocean's Alfonso Botha whose organisation is converting the building, and at least six others, to upmarket residential accommodation. It was really invigorating to be observing early evening city life from a bird's eye view.
The rooftop has a magnificent outlook overlooking Beyers Naude Gardens making me again so aware of the value of open space in the city. But also aware of how pleasant inner city living can be.
Residential accommodation is of course the key to the redevelopment of cities into vibrant 24/7 places. An article in 'Emerging Trends in Real Estate' nearly ten years ago distinguished between two types of cities, those that it described as having "24 hour environments" and "9-to-5s" respectively.
The former were distinguished as "attractive and busy" and the latter as "emptying out at five o'clock". And the differentiation wasn't merely academic. The article pointed out that in the US it was the cities with twenty-four-hour environments that were showing economic strength "while 9-to-5 downtowns continue to suffer".
In a more recent Wharton Real Estate Review, the author asks and answers the question of what makes a downtown a flourishing 24 hour place: "People prefer working closer to home...thriving residential communities in and around business districts are the key to preserving 24 hour environments. Downtown housing does more than provide convenient homes for white-collar workers.
Residents populate the streets after the offices close - and on weekends - contributing to a feeling of vitality. Their presence reinforces the perception - and the reality - of public safety. Residents patronize local merchants creating a diversified retail base, filling the gaps between the Gaps. Residents support local institutions - museums, concert halls, art galleries. They are the glue that binds together the larger downtown attractions."
Research shows that a viable downtown requires three factors, a critical mass, population density and a significant market share of the urban residents of the metropolitan area.
It also shows that the downtown residential sector must become attractive to families with children as well as young professionals and "empty-nesters". Rybczynski, "Living Downtown", points out that critical mass is required because it takes a certain number of people to support a competitive residential infrastructure. He points out that whilst there is no consensus regarding the exact number of people it takes to make a viable downtown, about 40 000 are required to achieve a truly urban scale. Density, both in terms of gross population and gross downtown density is the second factor.
If people are too spread out their effect on street life will be negligible but also if there are merely a few residential buildings they can be swallowed up and will not have the desired impact. But Rybczynski also points out that successful 24-hour downtowns require white-collar residents and this need rests on two synergies. "Walkability is one of the competitive advantages of downtown.
White-collar residential areas within walking distance of the central business district give downtown a competitive advantage over suburbs. Corporate head offices attract more housing which in turn stimulates office demand." 'Emerging Trends in Real Estate 2000' states that 24-hour cities are at the centre of the US' new economy - "financial services, high-tech and media all meet there. These are the exciting places where people want to work and live."
There is a perception that the Joburg downtown is a 9 to 5 place which certainly isn't true. For those that have a need to visit or be in the centre city at night there is a remarkable amount of activity. Whilst there are many parts of the city that are quite vibrant around the clock it certainly doesn't fall into the definition of a 24/7 place. Nor into a centre for white collar residential. Yet!
There is in fact a great deal of interest in creating substantial residential accommodation in the downtown area. Urban Ocean is one of a number of developers who are targeting the city's residential needs. They are currently largely targeting the upper income end of the market but will also be looking at the many middle income opportunities the city's redevelopment offers.
Recently I did a quick tour of Corner House and saw how a typical apartment floor is developing. The building provides a gracious and elegant framework for inner city living and, according to the signs outside, all the initial 15 units have been sold at a price of R799 000.
According to Alfonso Botha, some 80% of the first 65 units on offer at "The Franklin" - the previous Ernst & Young building in Diagonal Street - have been sold (selling at R300 000 to R350 000) whilst all 32 units at 1 Rissik Street, previously Penmore Towers, have been sold at between R290 000 and R350 000. These prices incidentally are for the 'shell' only.
In Newtown I see that the piling on the Johannesburg Housing Company's Brickfields development is complete and we can expect to see the superstructure of the 600 unit first phase development coming out of the ground shortly. These will be letting units.
There is a whole lot more happening in this market within the Inner City but just to round up this week, two websites to check out.
I received an e-mail during this week from an organization called "Brothers Innovation" (check out www.brothers.co.za/newsroom) that amongst other things states that "a South African entrepreneur and respected property developer, Farad Gani, has identified this growing international trend and his company, Rainbow Residential Apartments, is planning to convert several South African CBD based buildings into residential apartments.
Gani's company has acquired more than 20 buildings in the Johannesburg CBD and the company has, in a very innovative way, commenced with redevelopment work on the 12 storey Philadelphia House building which is located opposite the Sanlam centre in Johannesburg."
I must admit to not having heard of this company or of the acquisitions but it is indicative of the huge interest being shown in the city centre for residential property.
The other website to check out is www.saloftsonline.co.za which quotes Terence Conran "Finding new uses for old buildings can revive ailing sites in the heart of great cities".
The website provides interesting information on lofts including this reply to the question "Why go Loft?" - "Quite simply, the loft seems to be the perfect living space for modern life. It is (often) based in the city centre, uses recycled space, (so we can be stylish and green) and, most important of all, offers what little other residential property can: serious amounts of unadulterated space and light."
Whether its high income city centre accommodation, middle income rental or lofts, Joburg Inner City has them all.
