floor retail thus diversifying the income source . Salt River and Maitland are enjoying the knock on effect of the regeneration in neighbouring Woodstock ; also in these regions ’ favour is their proximity to the Cape Town CBD .
Parow and Goodwood ’ s retail spaces offer opportunity for densification by maximising highest and best use of the property through developing residential units on top of the ground floor retail spaces ; provided the building infrastructure will allow .
Parow East and Bellville with its light industrial factories creates demand for housing close to people ’ s place of work .
What makes Cape Town inner city a more attractive opportunity for property investors as opposed to other inner cities such as Johannesburg and Durban ? There is a migration trend of people moving to Cape Town and the Western Cape . These people need a place to stay . We forecast a shortage of 160,000 affordable residential rental units in the Western Cape by 2020 using extrapolated STATS SA migration and housing completion figures .
Supporting the above mentioned trends , Cape Town property has experienced high and consistent increases in value compared to other cities in South Africa .
What are Cape Town inner city property investors ’ main challenges ? Property is tightly held here and getting access to reasonably priced property is a challenge . However , innovative developments and structuring still unlock value and potential in the market .
RENTAL PRODUCT / TENANT FOCUS What kind of residential rental property product / configuration have you seen to be the most popular in Cape Town and why ?
Self-contained units with between 1 and 2 bedrooms are in high demand . The current trend is favouring 1 bedroom units . Square meterage for a 1 bedroom unit is in the region of 35m ² and for 2 bedrooms 45m ² is the standard . There is a variation of about 5m ² either side of these figures . Price is key and tenants look for the best value for their buck rating in order ; location , price , security and access to amenities .
Who are the residential rental tenants of the Cape Town inner city ? How does it differ from one area to the next ?
Young working individuals and families make up the bulk of the rental demand . Rental tenants come from all cultural backgrounds , countries and income levels . Cape Town CBD on a first Thursday evening in the month is a truly cosmopolitan mix .
Many foreign nationals are also looking to find work and accommodation particularly in some nodes in Bellville . This often results in over-crowding and is where Cape Town ’ s Problem Building unit is active . The student market is also very vibrant but a different and specialist approach to managing this kind of property is advised .
Developments & future focus What significant developments have taken place in the Cape Town inner city over the last 3 years ? Improvement initiatives from the City of Cape Town is making it more attractive for investors and tenants alike providing synergy between good investment for property entrepreneurs and improved living standards for tenants .
These improvements include infrastructure upgrades such as the MyCiti transport program and the Cape Town Urban Development Zone ( UDZ ) that has recently been extended to include Maitland and Parow . This is good news potentially boosting private sector investment . The removal of unnecessary red tape around development approval applications along with some relaxation on parking requirements where there are good public transport facilities go a long way in making Cape Town an attractive area to live and invest in
What are local government ’ s strategic plans for development ? What is the timeline of this ?
The City of Cape Town has allocated approximately R170 million in the current financial year for infrastructure projects in the Voortrekker Road Corridor . These projects pertain to employment and education facilities for those living within the Voortrekker Road Corridor , as well as for affordable , well-located housing which caters for key workers such as nurses and teachers .
We look forward to seeking out and identifying the opportunities that will arise from these infrastructure investments for our clients , property investors , their tenants and the broader communities in the Voortrekker Road Corridor
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www . reimag . co . za JULY 2016 SA Real Estate Investor 39