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Mandela Rhodes Places to be cornerstone of urban regeneration

Office, Retail, Industrial, Hotels and Residential
Posted On Sunday, 27 June 2004 02:00 Published by
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To have major spin-offs for the CBD property market
By Graham Harris

Mandela Rhodes Place, the R500 million Irish-driven development at the top of St George's Mall, is the jewel in the crown of central Cape Town's regeneration and will have major spin-offs for the CBD property market. Theodore Yach, of Theodore Yach Property Services, who was involved in the formation of the Cape Town Partnership in the late nineties and the subsequent creation of a Central City Improvement District, says the developers have made a long-term commitment to the city. "Backed by Howard Holdings in Ireland, the developers, Eurocape Investments Limited, have put down roots here.

They are employing South Africans to change an environment which is dear to us," said Yach. "The developers have made a serious acquisition. They understand that the only real way to effect long-term sustainable change is to change the whole precinct," said Yach. "To take two whole city blocks and make sweeping changes in concert with other property owners in the area has never been done before." Yach said the development would have a knock-on effect on the rest of the city centre property market and predicted a 70% increase in retail rentals between now and 2006.

He also predicted that B-grade office rentals would increase to between R65 and R75 per square metre, levels that had never been seen before. He said B-grade rentals in the CBD had been stagnant for the past eight years. Residential conversions, which will have taken up 145 000m2 of B- and C-grade office space by the end of next year, were also having a major impact on the market, he said. "This will obviously have a knock-on effect on existing space and I predict that office users will find it difficult to find space from next year," said Yach.

"It's been a given that you can't develop in the city without having parking bays in the immediate vicinity. I predict that in 10 years we will have pedestrianised most of the core 'Old Town' part of the CBD and that the major parking areas will be located on the periphery of the city centre - as they are in most major overseas cities. We will have a critical mass of people living in the city who will be comfortable walking to work or using public transport."

Yach said that in 1999 the central city had had 340 residential units. "By the end of 2005, developers will have built 2 500 units with a further 500 units on the drawing board. This will create a sustainable residential market going forward and impact positively on all the other market segments, especially central city retail activities." Yach said what was being planned in central Cape Town embodied the principle of "new urbanism". In addition to be being a place to live and work, the city would also provide amenities to meet everyday needs such as cafes, great shopping and a large amount of public open space where people could socialise. Turning to the hotel market, he said that in 1999 most of the major hotel operators in town had wanted to vacate the city. "By 2004, however, the number of hotel rooms in the cental city has increased by over 1 000 compared with 1999. We are looking at a very strong hotel market in the central city with strategic upmarket additions being planned to the current stock."

Yach commended the City of Cape Town's plans to develop low-cost housing nodes closer to the city in areas like Culemborg, Ysterplaat and Wingfield. "To have a stable population of 10 000 in Culemborg who have a stake in Cape Town and can trade up or down would be a win for everyone. "Since 1995 part of the Cape Town Partnership's vision has been that the central city can act as a catalyst for the regeneration of other urban areas around the metropole, like Athlone and Mitchell's Plain. We are at the beginning of a process - that is what excites me," he said.This article was originally published on page 8 of The Cape Argus on June 26, 2004
Publisher: The Argus
Source: The Argus
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