CBD grows despite economic climate

City Central Improvement District CEO Tasso Evangelino at the State of the Cape Town Central City meeting on Tuesday.

Despite the current economic climate, the Cape Town Central Business District (CBD) still managed to attract developments worth R950 million last
year.

This was revealed at the launch of the latest State of the Cape Town Central City report for the 2019 year in review, at the Cullinan Hotel on Tuesday.

Researcher Sandra Gordon said last year property values increased by 40%, with a total of 39 new developments worth R13.5 billion either recently completed, under construction or in the pipeline.

Among these developments are a retail and commercial development at 35 Lower Long Street; The Halyard at the Foreshore, a residential mixed-use development at 16 on Bree; upgrades to the CapeTonian Hotel; a mixed-use building at Mike’s Sports in Bree Street, and the expansion of the Iziko Museum.

Ms Gordon said there were talks of an extension of the Chris Barnard Memorial Hospital too.

This year, six more new developments worth more than R968 million have been reported.

She said three of the six are hotels which have already opened – Gorgeous George in St George’s Mall, Labotessa on Church Square, and Signature Lux hotel on the Foreshore.

Another two new developments are residential – The Duke and Fleetway House – while Foreshore Place will be a mixed-use development with both commercial and residential space.

“Even though the economy is suffering, the city is still attracting investment, which shows its resilience,” she said.

It also emerged that Cape Town was the leading digital city in Africa, and, as a result, had seen growth in the call centre industry, especially in the city centre. Ms Gordon said government was also working to make the city more technologically attractive, by rolling out 400 wi-fi zones within the city, as well as fibre optic cables, to which 1 000 buildings in the CBD are connected.

“Amazon is also expanding and identifying some spaces in the city. And call centres are benefiting from the technology in the city. There are reportedly 30 call centres in the CBD alone.”

It was also reported that there were 17 shared workspaces in the CBD, ranging from the conventional rent a table and chair facility, to coffee shops which made it easier for people to work from anywhere in the city.

It was also reported that, while vacancy rates for commercial office space had increased in the past year, with 30 000m2 of new office space coming on to the market over an 18-month period, Cape Town continued to have the lowest office vacancy rates of South Africa’s five largest metropolitan centres.

Ms Gordon said the events economy had always done well, and Cape Town was named the World’s Leading Festival and Events Destination at the World Travel Awards in 2018.

The City of Cape Town issued 1 277 event permits and supported 180 events in 2018.

Over the next year, just eight events will contribute more than R3 billion to the economy, creating over 20 000 temporary jobs, said Ms Gordon.

There was also a special focus on the Cape Town International Convention Centre (CTICC), which, it was reported, contributed R3.1 billion to the Western Cape, and created 8 553 direct and indirect jobs in 2018.

The CTICC was also commended for being one of the buildings which became self-sustainable during the drought that hit Cape Town last year.

Central City Improvement District chairman Rob Kane, said the most significant indicator of investor confidence was the the growth in property value of more than R12.2 billion from 2016/17 to R42.860 billion in 2018.

“We are heartened by the increase in gross valuation for the Cape Town CBD.

Combined with the developments under way or proposed, the overall picture shows confidence in the development potential in the city.”

Mr Kane said the report also revealed that nearly 60% of city dwellers owned their properties, while nearly 25% were tenants in rental properties. The remaining 15% owned their properties but rented them to tenants.

Former commercial buildings in the CBD converted to residential buildings include Triangle House, and the former Nedbank building on the Foreshore, recently launched as The Onyx, he said.