Residential survey

Flexible residential living options came to the fore in 2019 but were cemented in 2020 thanks to the weak economy and the Covid-19 factor. Property developers remained agile in their offering, with many presenting buyers and investors with an option to meet their needs. Very few new developments are purely residential or commercial. Generally, “mixed-use” means there is some commercial activity on street level or in the building itself.

Of the 15 developments under construction in 2020, nine were solely residential with three categorised as “mixed-use”.

The Harri, a R70 million residential property development with 48 studios and lofts in the East City, joined a slew of other CBD properties going the aparthotel route in 2020, including WINKS (Foreshore), Urban Oasis (P4) and BlackBrick Cape Town (P2). Other well-known CBD developments that are already operating as aparthotels include The Onyx and the Radisson Blu Hotel & Residence (both on the Foreshore), and the Pepperclub in P3.

Aparthotels allow property owners to tap into the property market and the hospitality market. They can choose to live in their unit when they need or choose to do so, and then add it to an existing pool of units should they wish to rent it out.

One of the interesting trends to emerge in 2020 was the club concept, with property investors not only having access to co-living and co-working spaces but becoming members of the development’s “club”. Three developments to initiate this trend in the Cape Town Central City were BlackBrick Cape Town in Precinct 2 (under construction) and Neighbourgood East City (P4) and Neighbourgood Reserve (P2) (the latter under construction in 2020 and the former planned).

BlackBrick Cape Town offers a combination of three interlinked uses, namely residential, hospitality and club membership benefits, which include use of a rooftop clubhouse and bar, workspaces, boardroom and café. Prices for units start at R895 000 with apartment sizes ranging from 23 m² to 36 m² .

The unique Neighbourgood portfolio offers members the option to rent fully furnished co-living suites with fixed monthly costs and flexible lease terms (from R5 950 to R10 950 per month) with access to communal spaces, free commercial grade WiFi, shared work and kitchen spaces.

Members have access to facilities at other Cape Town properties in the portfolio, with organised community events open to all members, too.

BlackBrick Cape Town

Both BlackBrick Cape Town and The Harri offered tax perks to buyers. BlackBrick offered buyers a tax benefit in terms of the Urban Development Zone rebate, which allowed purchasers to deduct 30 % of the purchase price against their taxable income over a five-year period.

The Harri allowed investors to be part of a Section 12J tax investment scheme. In a bid to lure local buyers, The Harri partnered with a registered venture capital company and financial services provider to create a Section 12J fund allowing buyers at the highest marginal tax rate of 45 % to deduct the full amount of a new unit from their tax liability.