Developers heading east

2017-04-25 06:00
Around R1.6bn worth of construction is underway or planned over the next few years in the east precinct of the CBD. PHOTO: Cape Town Central City Improvement District

Around R1.6bn worth of construction is underway or planned over the next few years in the east precinct of the CBD. PHOTO: Cape Town Central City Improvement District

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The CBD’s east precinct may be the face of the city centre’s future development.

This as the Cape Town Central City Improvement District (CCID) has recorded a record number of investment plans in the Foreshore. The CCID’s State of the central city report: 2016 – A year in review, released last week, found over R11bn worth of development completed, under construction or planned between 2016 and 2020.

The report lists developments completed in the city centre during last year, as well as those under construction, undergoing refurbishment or in planning or proposal phase as of December last year.

Rob Kane, chairperson of the CCID, says: “We base our calculations only on developments for which we have been able to confirm investment values. Sometimes the costs of developments announced have not yet been revealed by developers, and thus the numbers we publish in the report are only those that have appeared somewhere in the public domain.”

The investment is more than double that in the 2012 report, the first to be published by the CCID, which estimated development at around R5bn.

The Foreshore remains an attractive area for investors due to the number of “greenfields” sites, says CCID spokesperson and report author Carola Koblitz. This allows developers to build on vacant sites that have no previous development on them.

But when vacant land on the Foreshore is all snatched up, developers will start looking east, Koblitz speculates.

The Foreshore is not taking investment away from other areas of the CBD, she explains, but rather from other greenfields areas. But not all development is dependent on greenfields areas, and there is still potential for repurposing buildings and rehabilitating old industrial sites, she explains.

Developments in the CBD face heritage conservation limitations and height restrictions, but Koblitz speculates the east precinct – which is made up primarily of government buildings, including Cape Town Central Police Station, City Hall, the Grand Parade and the Castle – could see a boom of public/ private partnerships.

Investment in this area has previously been slow, with no projects completed since 2012, Koblitz explains. But the report shows future development in the area “paints a very different picture”, with R1.6bn worth of construction underway or planned for the next few years.

“Developers want to be part of the CBD so much that they will probably start looking at how to work within heritage restrictions to revitalise and rehabilitate underutilised properties,” she says. “The east city has buildings that were previously used as warehouses and developers looking at underutilised properties [may find better uses for them] – we may see the next Biscuit Mill being developed in the east city.”

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