Overcoming The Recession Analyzing The Johannesburg Property Scene
Category Advice
Property development in the inner city of Johannesburg (including areas such as Berea, Yeoville, Braamfontein, and Hillbrow) is steadily overcoming the recessionary trend. This is something that is great for owners of investment property in the CBD and surrounding areas. Property consultants have stated to the Business Times an amount of about R 7.5-billion that has been invested so far into the property market of Johannesburg since the year 2001. There has also been a further R 5.8-billion spent on renovation in the 5 major regeneration zones near the CBD. The city of Johannesburg is on the brink of becoming the residential hot spot of South Africa.
Although various kinds of commercial projects are being taken up, a major part of the refurbishing is being done to renew the buildings that are designated for residential use. Aengus Property Holdings is due to announce an investment of R1-billion in as many as 4000 residential units.
The Development Agency of Johannesburg that has been actively involved in the development of the city since 2001, has made significant investments which have totalled to R392 million. This is something that includes replacement of pavements, installation of street lights, reconstruction of public parks, offering new sports arenas and fields, bettering public buildings and the addition of artworks to public areas. The agency works in conjunction with developers and property owners and this is how a score of projects have been taken up. Johannesburg city is responsible for funding the work and the agency is involved in partnership with the Blue IQ.
Since 2001, property transactions have risen from 186 to 1 907 in the year 2007. The rejuvenation task of the Central Business District of Johannesburg might require 5 to 10 years to finish, but will mean lower vacancy rates, higher turnover and enhanced rentals.
According to a late study by some of the independent property consultants, important geographical areas of the Johannesburg inner city will alter from deserted no-go areas to attractive high-demand locations within a period of about 5 years.
Aengus is one of the major contributors to the project of regenerating the inner city. There are about 1500 residential units located in the Central Business District, running strong at a 100% occupancy rate. A yet to be announced merger and acquisition will cause the development project of 3500 to 4000 residential units located in the city to be constructed at an expense of over R1 billion within the next year to 1.5 years.
Perhaps one of the largest groups involved in the Central Business District happens to be the Affordable Housing Company.
More of such conversion projects are in the offing as more and more commuters prefer to live and work in the inner cities. It is therefore incumbent and imperative that there are more investors and developers with deep pockets in the property market who could implement their brilliant ideas in developing, building and converting properties to accommodate the burgeoning and insatiable desire of the populace to live and work in the inner cities.
Author: Imagine Properties
