Real Estate Investor Magazine South Africa May 2018 | Page 44
OPINION
The Case for
Specialised
Commercial Property
ample of modern retail specialisation in South Africa is Jo-
hannesburg’s Design Quarter that incorporates design and
interior with focussed retailers and tenants in a one stop
shop for consumers requiring these goods and services.
Durban’s Stamford Hiill Road factory clothing district
is a well-known high street version of these targeted retail
districts. New niched retail developments include those
that deploy a specific type of architecture or construction
materials that take root as is seen by the proliferation of
“Box Parks” made out of shipping containers.
An extremely innovative and unique sector specific node
is Durban’s Professional Quarter, which utilises a mix of
location, a differentiated product, supplementary services
and positioning to target the legal profession. Its proxim-
ity to the supreme courts, with a shuttle service, premium
office environment, mediation and arbitration facilities,
members club and IT infrastructure, have attracted long
term commitments from leading advocates and attorneys
against fierce competition. A number of initiatives and
nodes targeting call centres, student housing and education
have also been developed across South Africa.
The industrial sector has seen zoning and health issues
coupled to the desire to create synergies between busi-
nesses in the same sectors grouped together. Chemicals
processing and manufacturing, automotive, technology and
pharmaceutical areas are commonplace.
The high tech world of modern logistics has seen the
development of targeted logistics parks including Clair-
wood in Durban and Plumbago in Johannesburg.
Recent developments in the retail and listed property
sectors have also driven a re-think regarding diversification
in respect of individual companies versus exposure across
multiple shares or even index trackers. The challenge be-
comes slightly more complicated when individual compa-
nies success and size means they come to dominate a sector.
SOURCE
Broll
A digital
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every pocket
MIXED-USE DEVELOPMENTS
We’ve seen more and more of these developments
pop up around the country. Centered around the
concept of being able to live, work, and play in the
same area, mixed-use developments aim to bring
different people and industries together. One of
the latest examples is Loftus Park in Pretoria.
BY FRANK REARDON
W
hilst niched property developments are nothing
new, recent developments appear to indicate an
acceleration of developments targeting specific
business segments, tenant types or consumers looking for
a specific product.
The age old question of specialisation versus diversifi-
cation has also played itself out in the South African list-
ed property sector for years. Funds with retail, industrial,
hospitality or other focuses have been fairly common with
the advantages of focussing and developing competitive
42
MAY/JUNE 2018 SA Real Estate Investor Magazine
advantages in specific areas weighed against the risks asso-
ciated of putting all one’s eggs into one basket.
While many recent specialised developments are to
some extent a sign of a more mature property industry with
fewer gaps in the “traditional” market, the retail industry
has from the first cities and towns had areas, districts or
high streets that serviced specific products and consumers.
Examples of these include garment or textile districts,
watch or jewellery streets, medical streets, antiques dis-
tricts and fish and fresh produce markets. A standout ex-
Developed by Redefine Properties and Abland,
the first phase comprises 34,000m² A-grade office
space, a premium gym, open-air piazza with
restaurants and convenience retail. There is also
more to come. A new 152-room Protea Hotel by
Marriott will debut at the site. Phase Two, which
will add another 7,600m² to the Loftus Park de-
velopment, will see a hospital join the precinct, as
well as 13,000 m² of office space in Phase Three.
Pieter Strydom, commercial asset manager,
Redefine Properties, says: “The opening of the first
phase of Loftus Park realises its vision of being
an iconic mixed-use precinct that provides an
integrated work and play environment and is posi-
tioned to ignite the greater node around it.
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SA Real Estate Investor Magazine MAY/JUNE 2018
43