Braamfontein finds its home in residential market

BRAAMFONTEIN’s residential property market is “cooking” and is one of the inner city’s success stories, say property pundits. They believe Braamfontein and nearby Newtown probably show the most promise. There is a great deal of demand for residential space in Braamfontein, which is close to tertiary institutions.

David Green, the MD of commercial, industrial and residential property brokers Pace Property Group, says demand for residential space was illustrated on November 4, at the launch of the new Broadway apartment block in Juta Street, Braamfontein. The 140-unit block, which is being marketed by Pace, sold out completely by the end of the weekend.

The average price of units was R350000 each, which included transfer duty costs, surround-sound music systems, plasma televisions and metallic-finish refrigerators. The complex also includes 24-hour security and a heated swimming pool.

This office-to-residential conversion development took place in a redundant office building.

The new buyers include a mixture of owner-occupiers and investors, “with an emphasis on owner-occupiers”.

Green says Pace will probably bring about 2000 new residential units to the market in Braamfontein and nearby central business district next year.

These units are in various residential developments, the largest being a single property with 400 units.

Green says Braamfontein and the central business district (CBD) are more orientated towards young couples and single people. “There is considerable demand. We have a waiting list for purchasers wanting to purchase in Broadway in the event that some of the current deals don’t go ahead or get bond approval.”

He says Braamfontein is attractive because it has an established infrastructure in terms of retail, banking and restaurant facilities. “And this is going to improve over the next year substantially as various upmarket retailers return to Braamfontein.”

Another factor favouring Braamfontein is that there is little low-income residential space already in existence, says Green, unlike Hillbrow and Berea, in which there are large low-income populations.

He says the profile of the Braamfontein buyer is no older than 35 years. These are generally newly married couples, with no or very young children, from all ethnic groups. “They are usually people employed in the CBD or surrounds, but including areas up to Sandton.”

Green says Pace has marketed the four biggest developments in Braamfontein, with involvement in various residential schemes in Newtown.

“I think Newtown and Braamfontein show the most promise for future residential development as there is an established infrastructure and an availability of land to develop.” He says the inner city’s financial district, where the major banks are situated, is more limited in terms of development opportunities. “There may be one or two developments to come out of there.”

Aengus Property Holdings, which has done a number of office-to-residential conversions in the inner city, including Braamfontein, believes that, in general, the inner city is turning around, but specific areas such as Braamfontein, Newtown and the “legal district” in the vicinity of the Johannesburg High Court, are showing good promise.

Aengus Property Holdings’ residential developments are held as rental stock. MD Richard Rubin says his company’s first office-to-residential conversion was in Braamfontein two-and-a-half years ago. Braamfontein Lofts, on the corner of Juta and Biccard Streets, is the group’s “best building in terms of occupancy rates”, with a waiting list of people eager to rent.

Gavin Meskin, the operations director for Aengus Property Holdings, says the group plans to develop more residential property in Braamfontein.

“If we could buy 10 buildings tomorrow, we would. The demand for residential space is huge.”

Article by: Nick Wilson - www.businessday.co.za