Understanding inner city opportunities
Investment broker manager for JHI property services group, David Reid says that according to the spatial development framework, it is estimated that currently some four million people live in and around the Johannesburg CBD and greater Johannesburg area.
Easily the largest CBD in South Africa, the Johannesburg inner city is emerging as the most important public transport hub in the economic powerhouse of Gauteng. A catalyst for these positive changes is the determined effort by the authorities to provide public transport as an alternative to road transport with the objective to reduce traffic congestion.
Reid says these improvements will have a considerable impact on the changing face of the Johannesburg CBD and says it is interesting to note how the inner city will benefit in comparison to decentralised nodes such as Midrand, Sandton, Centurion, etc.
The fact is that those who live in decentralised nodes will need to give serious thought to the cost of transport to and from places of work as the cost of freeway tolls, when added to the cost of fuel, private vehicles including maintenance, even carbon tax still to be introduced, will make commuting to and from these nodes unachievable for many. These costs will make the Gautrain and BRT (Bus Rapid Transit) very appealing, especially when one also takes into account the stress of sitting at the wheel in heavy traffic congestion and wasting considerable time, as opposed to a railway carriage where one can work, read or relax. However, its also true that the cost of the Gautrain and feeder routes to and from decentralised zones will make use of these unaffordable for many.
Well provided with intensive public transport, it follows that the trend must be a steady return to the Johannesburg CBD as a location to live and work and consequently as a preferred location for many businesses. But what impact will this have on the CBD? says Reid.
Bounded by Braamfontein Ridge to the north, End and Joubert Streets to the east, the M2 freeway to the south and the M1 freeway to the west, the heart of the Johannesburg CBD is at Park Station, with the Gautrain and BRT and feeder routes spreading outwards through Gauteng akin to a huge spiders web. Says Reid: As a result of this we are likely to see a new demand for office space in the CBD, mainly from organisations and businesses which are large users of space and with employees in the lower to middle income brackets. Those attracted to the central city by affordability and accessibility may include government organisations, banks, NGOs, lawyers, accountants. In addition, other large users of space such as call centres, private colleges and smaller emerging companies will seek out prime locations in Braamfontein and the Johannesburg CBD.
Serious land owners in the CBD have already woken up to this opportunity which is evident from the new developments that have taken place, such as Zurich Re in Ferreirasdorp, AngloGold head office and Ashanti Gold in Newtown, the Absa Campus which sprawls four CBD blocks, and Bank City now stretching from Simmonds to Diagonal Streets. In addition, refurbishment of existing buildings - some over 50 years old, is taking place despite the fact there is as yet no certainty regarding occupancies but with a strong awareness that it is only a matter of time.
Reid says the Johannesburg CBD is home to a variety of retail outlets from malls such as the Carlton Centre to street front trading at Bree and Main Streets and to upmarket boulevards such as the Main Street Mall, which is now a leasehold property under the sound management control of a team of Main Street landlords.
Emerging inner city nodes:
What is currently emerging in Johannesburgs inner city is a series of key nodes of increasing relevance, originally identified through City Improvement Districts, and put in place by landlords anxious to address urban decay. These are now steadily being overtaken by private, landlord and tenant initiatives setting about maintaining the respectability of their areas. The first of these nodes is Braamfontein tenanted by a number of educational institutions, public sector and civic amenities, traditional offices and a huge proportion of residential accommodation, with the latter making this area one of the most important mixed use districts in Gauteng.
Within the inner city, which comprises over two million square metres of office space including traditional commercial B and C grade and increasingly B plus and A grade offices, there are a number of emerging nodes. These include the precinct from Absa Campus to Arts on Main, the Main Street boulevard (home to banks and mining houses), the area from Bank City to Newtown, the retail district from Plein to Commissioner Streets, and the south-western district. Other precincts which are emerging include Jewel City on the eastern edge of the city centre, Constitution Hill in Braamfontein, the Gautrain Park Station node with commuter rail, Spoornet long distance rail services, local and long distance minibus taxi services and bus services, adds Reid.
Article from: www.eprop.co.za