Cape Town’s Central City region has witnessed property value growth from R6,127bn in 2005 to well over R24bn in 2015. Rob Kane, chairperson of the Central City Investment District (CCID), predicts that this number is expected to rise to well over R32bn within five years.
“Over the course of 2015, and since the launch of the report previous to this one [2014 in review], we’ve seen, conservatively, another R1,872bn of investment committed to the CBD,” says Kane, noting that the Cape Town CBD accounts for more than 25% of the metropole’s economy and 30% of its workforce.
The R1,872bn includes R1,76bn of private investment, and another R112m to be invested by the public sector, largely in upgrades to existing government buildings.
In an online business survey conducted with CBD-based enterprises, 86% of businesses intended to remain in the area and 30% were thinking of expanding. On the formal retail front, 86% of business owners expressed their satisfaction of having chosen the CBD as a base for business.
The CCID’s annual online residential survey reveals that residents in the CBD (the population of which is now estimated to be well in excess of 6,000 people) have a desire to see retail with longer opening hours beyond 17h00, more delicatessen-type food stores and more restaurants.
The legal and creative economies continue to prop up the economy and stature of the region with CCID communications manager and author of the 2015 report, Carola Koblitz, saying these two sectors have formed their own neighbourhoods.
“We now have two such legal neighbourhoods in the CBD – with advocates clustering around the High Court on the older side of town close to The Company’s Garden and the large legal firms rising in their own named buildings in the Foreshore area on the other side of town, where greenfield opportunities have given rise to striking, contemporary architecture,” she says. “Likewise, the creative industries are now clustering in the East City area, where an increasing number of very affordable co-working spaces exist – ideal for start-ups.”
Teching up the CBD
Another primary factor that is now positioning the CBD as a frontrunner for those looking for new business premises is the city’s pilot project in the CBD that leverages the rollout of its fibre-optic broadband network for use by the private sector. With R1,7bn being spent by the city throughout the metro to connect its own buildings and facilities, as well as those of the Western Cape government, the network is now robust and extensive enough for the city to install cables to buildings that enable commercial operators to use the infrastructure to provide competitive, high-speed (1GB/s) fibre-based services to tenants of commercial buildings. As a result of the pilot project being run in the CBD, 35 buildings had already been connected as at June 2015 and it is estimated that more than 1,000 will be connected by June 2021.
Other features of The State of Cape Town Central City Report: 2015 – A year in review include:
A property investment map, showing the locations of all known developments in the CBD (at the time of going to print)
Comparative year-on-year commercial property rental and vacancy rates, as well as retail occupancy rates
Information on the numerous commercial property tools available to investors via government resources, including the City of Cape Town’s Economic Areas Management Programme (ECAMP), Development Application Management System (DAMS), 3D Building Modelling system pilot programme, and South African Revenue Service’s Urban Development Zone (UDZ) tax incentive, in which the Cape Town CBD falls
Residential property trends over the course of 2015, and a map of the CBD showing the locations of current residential blocks that appear on the deeds office registry
Advice on taking the “green leap” in a section on the Green Economy of the Central City.
Photos courtesy Brent Smith & Ed Suter