Business Day HomeFront 05 October 2018

HOMEFRONT 13 OCTOBER 2016 WWW.BDLIVE.CO.ZA 5 OCTOBER 2018 WWW.BUSINESSLIVE.CO.ZA

MUST READ

Saint’s pizza hits The Marc PAGE 2

Know your property buyer PAGE 10

New rules: sectional title and cannabis PAGE 11

Developers turn to rentals Optimism for African retail

The rental market is showing strain, but appears set to improve in Gauteng — and a number of developers are getting in on the act PAGE 6

PAGE 12

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HOMEFRONT LIFESTYLE

Saint in Sandton Chef David Higgs’s latest culinary adventure showcases pizza in a landmark Johannesburg precinct WORDS: GRAHAM WOOD :: PHOTOS: SUPPLIED

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o, what exactly is one of the country’s top chefs doing opening, of all things, a pizza joint in Sandton? In August chef David Higgs, of Marble Restaurant fame (and Five Hundred at The Saxon Hotel before that), opened the doors of Saint, an Italian restaurant specialising in pizza, with his Marble business partner Gary Kyriacou.

Saint isn’t an ordinary pizza place. To start with, there’s its size — a 1,000m 2 space overlooking Maude Street from The Marc, the pineapple-shaped building on the site of the old Village Walk shopping centre. The Marc is part of a mixed-use precinct that has changed not just the Sandton skyline, but the streetscape around it and the JSE opposite. The precinct includes legal firm ENSafrica’s new 17-floor headquarters, but inside

the “pineapple” part of the development there are shops, offices, a gym and, to bring a precinct like this to life, restaurants.

“As they started putting the tenant list together, we were one of the first people that they approached,” says Higgs. They were interested. “First, the site is great, and the positioning is great,” says Higgs. “And then there was this very interesting building.”

Marble found its place in the catalytic Trumpet building, a turning point in the development of the Keyes Art Mile and the regeneration of Rosebank.

The Marc offered another transformational piece of architecture, but with a different kind of potential.

“We wanted to be in the CBD,” says Higgs. “We wanted a different offering to what we had in more residential Rosebank.”

The story goes that some time before, Higgs and Kyriacou were in a New

York restaurant enjoying the meal and the buzz, when in walked fashion designer Alexander Wang with a bunch of models and ordered pizza and Champagne.

The combination of glamour and simplicity resolved in a vibey atmosphere struck them as something the Johannesburg dining scene sorely needed.

A changing Sandton CBD seemed to demand a certain urban energy.

Higgs is emphatic that, as important as food is to him — and it is very important — restaurants, even simple Italian ones, need to offer something more. Times are tough, and those doing well are working hard for their money. “So when you spend that money, you think very hard about where you’re going to go and what you’re going to do,” he says.

“People don’t want to come into restaurants to sit and eat any more.” They want a complete experience.

HOMEFRONT

“We wanted a different offering to what we had in more residential Rosebank” David Higgs, co-owner, Saint restaurant

Food The pizzas at Saint are made in the Neapolitan style, which are undeniably the most delicious.

Neapolitan pizzas are thin and have equal, fairly restrained amounts of sauce and mozzarella, which typically leaves them soft and chewy in the middle.

Simplicity is the key. The classic Neapolitan pizza has no more than tomato, mozzarella and basil on top.

For Higgs, pizza is about quality and not the volume of toppings.

“When you make a pizza, when you serve a pasta, there’s absolutely no hiding,” says Higgs.

There are no frills and foams and flashy extras.

“It really is what you see is what you get.”

Kyriacou went to the International Pizza Expo in Las Vegas and sourced a specialist mixer and two custom-made Stefano Ferrara pizza ovens which, Higgs explains, reach temperatures so high that a pizza cooks in 60 seconds.

Ingredients are carefully sourced — some imported, and some — the Buffalo mozzarella — from local suppliers such as Puglia Cheese.

They also packed off head chef Matt van Niekerk and chef de partie Tyler Clayton to Italy to learn the art of Neapolitan pizza-making.

At Saint the simplicity of the ingredients is elevated by beautiful presentation and given a unique spin with a few “little twists and turns here and there”.

Decor Kyriacou’s interior designer wife Irene worked closely with design studio Redecco on the restaurant’s interiors, that other crucial aspect of the “complete experience”. The potentially intimidating size of the space was turned into its central virtue.

“I love the scale of it,” says

Irene Kyriacou. “Sometimes you just want to be in a space where you feel like you’ve gone on vacation.”

The décor is a heady mix of modern and classic influences that Kyriacou dubs “contemporary renaissance”. “With the volume of the space and all those beautiful columns, I immediately thought of the Sistine Chapel and [Italian] palazzos with beautiful frescoed ceilings,” she explains.

Although it is all delightfully over the top, she wasn’t after a cheesy pastiche. Behind the bar, for example, is a massive “deconstructed” interpretation of a classical sculpture by Damian Grivas. In the centre, there’s a sort of vaulted dome, but instead of an old-fashioned fresco, it is animated with 3D projections.

The furnishings — many collaborations with local designers — are boldly coloured and luxurious.

The wine cellar has a contemporary stainedglass design. The frontof-house staff are dressed in David Tlale. Even the pizza ovens are gold, and the open kitchen, Kyriacou points out, introduces an additional element of culinary theatre.

There’s no denying the place is enveloping and the experience multifaceted.

Perhaps what makes it so different is that, combined with something in this context as quirky as pizza, lies an old-fashioned idea — the glamorous sense that in a big city, you can walk into a landmark building and enter a different world.

As the city changes and new precincts and architectural landmarks spring up, it is demanding new and different culinary responses. Posh grills, pizza and Champagne … what next? saint.restaurant

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HOMEFRONT HOMESENSE

See more, hear more SA is right up with the tech times in home entertainment WORDS: ANNE SCHAUFFER :: PHOTO: SHUTTERSTOCK

“For a nominal monthly subscription most music can stream into your home or be stored on a portable device for offline playback” Klaus Wagner, co-owner, Audio Excellence

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A keeps abreast of international home entertainment trends, adopting them within weeks of an international launch.

This is the view of sales consultant Warren Husband of Homeation, an importer of top audio-visual brands.

“Our industry is right up to date. The world has become truly global with no country dominating,” says Klaus Wagner, coowner of Audio Excellence in Umhlanga.

WIRELESS MUSIC Having your music available throughout the home is still one of the most sought-after home entertainment solutions.

“It allows for any music signal source, be it a CD player, phone, music streaming service or FM radio, to transmit wirelessly from one room

to several, all controllable by a smart device,” says Wagner. “Our preferred all-encompassing product for this is Yamaha Music Cast.”

Says Husband: “Companies such as HEOS by Denon can add this feature to the home without cutting into ceilings or running cables across walls to add speakers throughout.

It still offers all the features and abilities of a centralised system, which is typically installed at the time of a new build or renovation.”

series or music, our improved internet infrastructure and highbandwidth internet has opened up a whole new way to enjoy our favourites,” says Husband.

“Gone are the days of looking through old CD or DVD boxes only to find out the disc is missing ... Deezer, Tidal and Spotify for the audio enthusiasts and Netflix, Showmax and even DStv are offering their content over the internet, so you never miss a beat when it comes to seeing or hearing your favourites.”

STREAMING SERVICES

TURNTABLES

Streaming services are not a physical product, but allow access to huge music libraries. “For a nominal monthly subscription most music can stream into your home or be stored on a portable device for offline playback,” says Wagner.

“Whether it’s movies,

Turntables are not a new technology, but prove that ultimately we are human and, like books, some things are better if they’re tangible, says Wagner. “For a physical connection to the music which matters to us, nothing beats an LP for its artwork, linear

notes and authentic sound. Turntables range from modest to state-of-the-art, using modern materials and engineering techniques.

For music nirvana, we love ClearAudio from Germany.”

HOME THEATRE The home-movie experience can vary from an ordinary soundbar to truly immersive cinema.

Says Wagner: “It has expanded from sound playing only in one plane — front to back — to coming at us from a 360o field with overhead speakers. Dolby Atmos and DTSX can position a sound accurately within a room. Quality home theatres do require the services of a speciality audio-visual integrator such as Audio Excellence.”

PORTABLE SPEAKERS Husband says portable entertainment technology is a fast-growing

segment of the market, which introduces high-quality audio and video experiences to a younger generation, or to those who might not be purchasing larger homeinstalled solutions.

“For those on the move, who want to take their favourite entertainment experiences with them, there are multiple solutions — headphones in all shapes and sizes for your gym session or travelling (with active noise cancelling for planes, trains and buses), or even for high-quality audio when at home, but without disturbing other family members.

“Portable speakers are also being reinvented,” says Husband. Some are water-resistant so “you can bring your favourite music to the pool or beach without worrying the device might not survive the trip”.

AFRICA’S RICHEST SQUARE MILE IS ON THE MOVE

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S T E Y N C I T Y. C O . Z A

HOMEFRONT

Uvest’s Stellendale Village, Kuils River

W Developers PROPERTY TREND

turn to rentals

The rental market is showing strain, but appears set to improve in Gauteng — and a number of developers are getting in on the act WORDS: GEORGINA GUEDES :: PHOTOS: SUPPLIED

hile the rental market is slowing or in some cases in decline, developers have realised that they can offer these types of properties at a lower cost and a wider margin than estate agents.

In Q2 2018, the national rental growth rate has trended downward, with a year-on-year increase of just 3.27% for June, according to the PayProp Rental Index.

The Western Cape has lost its spot at the top of the provincial growth ratings, with growth of only 6.97% in the quarter.

Grant Rea, residential sales and letting specialist at Cape Town’s City Bowl office of RE/MAX Living, says that in 2018 he has seen a shift to an oversupplied and underdemand rental market for the first time in seven years.

“As a whole, we noticed a significant shift from around October 2017 that saw landlords facing vacancies for the first time in years.

Previously the demand was always significant enough to ensure each property found a great tenant,” he says.

Landlords used to an

average gross yield per annum of about 6% are dealing with 4.5% to 5.5% yields in 2018. Adjusting expectations is required.

RIGHT PRICE “Everything rents at the right price as everyone needs a home,” says Rea. “There is no question that you will find tenants, provided that the rental is competitive.”

He says that since one of SA’s largest property portals has been advertising more than 4,000 rentals across the City Bowl and Atlantic Seaboard, agents and landlords will have to do more to expose their properties to a wider audience and consider including extras such as Wi-Fi, utilities and some services.

OTHER PROVINCES The Free State now occupies the top growth spot with rental growth of more than 8%.

KwaZulu-Natal has also trumped the Western Cape, with 7.31% growth (albeit in Q1).

Even so, KwaZulu-Natal agents report that they are feeling the pinch. Jo Giraudeau, rental manager for residential and commercial property at Seeff Mid-South Coast and

Seeff Amanzimtoti and Hibiscus Coast, says that the total income for the first half of 2017 decreased by 1.7% compared with 2016. It then decreased by 1.85% in 2018 compared with 2017.

“The first change we are noticing is that in some months we have more stock than we have inquiries — whereas before we could not keep up with the number of inquiries,” says Giraudeau.

Many landlords have now decided to opt for unmanaged leases to save on costs.

RECOVERY PayProp predicts that Gauteng, if the long-term trend is taken into account, might show recovery in the next two quarters while, if provincial cycles are anything to go by, there will be at least two more declining quarters.

However, there is a positive spin-off. While rentals do not offer the best growth in the market, a new trend is emerging for developers to get in on the rental action.

The PayProp report suggests that developers can make the same profit margin as an agency — with lower rental income levels. Rental properties enter the market at lower

HOMEFRONT

The Oval Luxury Apartments, The Hills Game Reserve Estate in Pretoria

“There is no question that you will find tenants, provided that the rental is competitive” Grant Rea, RE/MAX Living

rents, leaving agents in competition with developers for tenants.

Century Property Developments originated its business model with the development of “luxury lifestyle estates”. But a few decades later the company took the decision

to diversify its product offering to include rentals, without losing its focus on lifestyle aspects.

“We own and manage six rental developments consisting of roughly 1,500 units with several new ones in the development pipeline,” says Jessica Hofmeyr, Century executive for sales, rentals, marketing and operations.

GOAL

Manhattan Sunninghill

“Our goal is to release two new developments into the market a year. We aim to design, construct, manage and market our developments in-house.”

Century’s rental units range from bespoke freestanding five-bedroom houses to upmarket luxury apartments.

No units in the rental developments are for sale.

They include Waterfall Crescent, The Sheds @ Waterfall and The Waterfall Villas, all located in Waterfall Estates.

Crowthorne Luxury Apartments and Carlswald Luxury Apartments are in the Midrand area and The Oval Luxury Apartments are in The Hills Game Reserve Estate in Pretoria, also all for rental only.

Whether the property is intended for sale or rental, Century ensures that its estates have lifestyle

features such as private schools within the estate, walking trails, clubhouses, swimming pools, laundromats and children’s play areas.

“Our rental estates now offer tenants free internet and Showmax accounts.

Children have free weekly art classes, tennis coaching, swimming lessons, hip-hop dancing and many more extras,” says Hofmeyr.

“Adults have access to free boot camp training, outdoor movies and tennis coaching.”

She says these extras have yielded outstanding results, delivering a 98% letting statistic.

AFFORDABLE In 2017, JSE-listed Balwin Properties announced that they had formed a strategic alliance with Transcend Residential Property Fund to bring to market 8,900 affordable rental apartments over six years, worth an estimated R6.4bn, across five developments in key Gauteng nodes.

The first of these developments was to have been Green Park, comprising about 1,200 apartments in Boksburg.

However, Balwin reports that the deal has not gone ahead.

HOMEFRONT

The Waterfall Villas, Midrand “Progress has been made towards a strategic objective to deliver a residential rental model in which phases will be sold to a consortium, which will derive income from leasing the apartments,” says Balwin Properties CEO Steve Brookes.

“Management will keep the market updated in this regard.”

Renprop, another developer that typically sells developments off plan, has a residential rentals division to handle rentals on behalf of the apartments’ investor-buyers.

It has also developed two pure rental scheme apartment buildings to cater to the demand for rental apartments in the Sunninghill and Rivonia areas of northern Johannesburg.

The developer is in the early planning stages for two additional pure rental

Uvest’s Quintessa in Buh-Rein Estate, Kraaifontein scheme developments.

“There is a definite need, and therefore larger demand in the market, for rental units,” says Renprop MD Chris Renecle.

REITS “The acceptance of residential Reits in the listed property sector has also created more opportunities for this kind of development.

“The continued strong demand for rental units is mainly due to the financial constraints many purchasers in the middle and lower end of the market have,” says Renecle.

“Renprop has placed itself in the middleupper income areas in the northern suburbs of Johannesburg such as Rivonia and Sunninghill, with rentals priced from about R6,000 to R12,000 a month.”

One such development

is Manhattan Sunninghill.

A pure rental scheme, 180 units in this apartment block cater to strong demand for sectional title rental units in the area.

“Renprop has developed Manhattan as a pure rental scheme in response to the strong demand from those looking to rent sectional title property close to the business districts of Sandton, Waterfall, Midrand, Rivonia, Fourways and Sunninghill,” says Renecle.

The Uvest Property Group is a prominent developer in the Western Cape.

Although the company develops large-scale infrastructure housing developments for sale to the open market — for example, Sitari Country Estate in Somerset West — a major component of its business model is to develop and build rental housing stock, which it

“We develop for sale at the top end of the market, while we develop to rent out in the affordable or middle-market segment” Philip van der Berg, residential funds director, Uvest

reserves for placement in its affordable rental housing fund.

“We specifically adopted this approach as a ‘strategic hedge’ within the ever-fluctuating South African housing market,” says Philip van der Berg, residential funds director at Uvest.

“We develop for sale at the top end of the market, while we develop to rent out in the affordable or middle-market segment,” says Van der Berg. Rentals range between R4,500 and R10,000 a month.

“The theory is, if you start struggling to sell at the top end of the market, there should be sufficient counterbuoyancy to rent out in the middle end of the market, and vice versa.”

The residential rental fund began in 2013 and Van der Berg says that it is a proven success.

“We are currently co-

invested, with institutional or pension fund investors in many cases, in about R1.2bn-worth of residential units — all Western Cape-based.

“As a property and asset management company, we manage in excess of 1,500 units at present — and we are proud that over the past five years, we have managed to maintain a net yield on most of our portfolios of comfortably above 9%.”

RECIPE The not-so-secret recipe for success entails the basic principles of property management: build a quality product, but at a reasonable cost, and once complete and ready for occupation, ensure that your tenant-vetting process is meticulous.

Then once let and occupied, maintain the strictest, hands-on management control.

VACANCIES RISING TPN Credit Bureau reports that the vacancy rate for Q2 2018 has risen for the second quarter in a row to 7.9%, driven by high vacancies in both the lower end of the market below R3,000 a month (7.9% vacancies) and properties letting for more than R12,000 a month (14% vacancies).

Properties letting for R3,000-R7,000 a month had a vacancy rate of 6.3%, while those letting for R7,000-R12,000 had a vacancy rate of 7.4%.

The Sheds @ Waterfall, Midrand

YOUR PROPERTY DEVELOPMENT PARTNER

HOMEFRONT BUYER SPECS

Who is your home buyer?

If you want to sell, understand the types of home buyers out there — the right approach can end with a successful deal PHOTOS: SHUTTERSTOCK

1. FIRST-TIME BUYERS Middle-class families looking • for a foot in the door to home ownership based on affordability.

Searching for homes with large gardens, • at least two bedrooms, two full bathrooms and a room for visitors.

More women own property Lightstone Property reports that single women property buyers have been steadily increasing since 2016 in SA’s four major regions, noticeably overtaking single males and married couples

2. MOVE-DOWN BUYERS High net worth professionals who • want to downsize after retirement.

Can also be empty nesters selling • down to a lock up and go.

Selling luxury homes and buying smaller • homes in quiet locations that are easier to maintain and close to amenities.

3. FIX AND FLIP BUYERS Investors who specialise in buying • (sometimes renovating) and selling homes to flip or rent to middleclass families or professionals.

Generally thrifty and savvy.

• For an investor buyer, a house should • be in a good location at a decent price.

SINGLE FEMALES RULE Volume of ownership across SA The most Gauteng and Eastern Cape residential property sales The most properties purchased at less than R250,000

4. RELOCATION BUYERS Semigrators have a limited amount • of time to find a property in their desired location, so want to see as many homes as possible.

They are usually rock solid • and qualified to buy.

MARRIED BUYERS RULE

5. LUXURY BUYERS High net worth individuals or • international professionals who may have several homes.

Will spend to secure a home that • offers luxurious amenities such as heated floors, open floor plans, chandeliers and large bathrooms.

Will view many homes before committing • and may have a long list of requirements.

Source: Engel & Völkers Southern Africa and staff writer

Properties with the highest value across SA The most Western Cape and KwaZulu-Natal residential property sales

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HOMEFRONT “Having a flowerbed filled with dagga plants in an area accessible to the complex’s other residents, including children and teenagers, could be cause for concern” Marina Constas, director, BBM Attorneys

LEGAL

Going up in smoke Check out the sectional title small print before lighting a joint on your balcony or cultivating cannabis among the dahlias WORDS: MARINA CONSTAS AND STAFF REPORTER :: PHOTO: SHUTTERSTOCK

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ome South Africans in sectional title developments may be celebrating the recent Constitutional Court ruling allowing them to smoke marijuana in the privacy of their homes. But they should arm themselves with the right information before taking a puff.

Specialist sectional title attorney Marina Constas says the ruling may not cover getting baked on your balcony or in the garden.

And it definitely does not allow lighting up at a communal clubhouse or swimming pool.

“Prior to this case, if you smoked in your own home, you could have been arrested,” says Constas, a director of BBM Attorneys. “You would have had to use the defence of privacy in order to fight the charge. Now,

you cannot be arrested.

That’s the nub of it.”

So what has changed?

“In sectional title, your own home would include your ‘section’ and registered or rule-created exclusive use areas. So you could sit and smoke a dagga joint in your lounge or on your balcony, but only if your balcony is part of your section, or if it is an exclusive-use area either registered in the Deeds Office or allocated to you through the development’s conduct rules.”

Common property However, those living in sectional title developments should take care to check whether the balcony is in fact registered as common property, as they sometimes are. “Strictly speaking, this area can then be used by everyone and is not in law private,” says Constas.

Smoking dope in your

garden may be problematic if the garden is common property. “Growing it on common property would also be an issue,” she says.

“If the garden is a private, exclusive-use area — registered or rule-created as such — you would then be in a position to use the Constitutional Court case.”

Access Yet Constas says that even if a resident was growing marijuana in a private garden in a sectional title complex, the question of accessibility could become problematic.

“Measures would need to be put in place to ensure that the area is secured and only accessible to the owner for private use.

“Having a flowerbed filled with dagga plants in an area accessible to the complex’s other residents, including children and teenagers,

could be cause for concern.”

Clubhouses Many sectional title developments have clubhouses where residents relax and socialise. Constas says the court ruling does not mean that this may now include indulging in marijuana beside the pool.

“There can definitely be no smoking of marijuana at the clubhouse or pool area,” she says. “The ruling specifically states that you can smoke it only in the privacy of your home.

Marijuana is distinguishable from cigarettes and alcohol, so even if these are allowed at the clubhouse, the smoking of dagga on any common property area in a sectional title development is not legal.”

Duplexes Duplex situations in sectional title developments

also pose an issue. “Where you have a duplex situation, it would have to be borne in mind that the actual physical smoking of the marijuana in the privacy of one’s own home is legal,” says Constas. “If you smoke on your exclusive-use patio, you are within your rights to do so.

“Smoke is insidious, however, and will move beyond the boundaries of your own home.

Consequently it would have to be treated the same as cigarette smoke or other smells that could offend neighbours in the complex.”

The law “The latest sectional title legislation’s new Rule 30(e) under the heading dealing with the use of sections and common property may offer an answer,” says Constas.

“It states that owners or occupiers of sections or

exclusive use areas must not do anything within these areas that will have a ‘material negative effect’ on the value or utility of any other section or exclusive use area.”

She says that there may be place for sectional title trustees to set out certain conditions in the rules of the scheme, but that they would not be able to ban the smoking of marijuana in their rules.

“It could not be banned — even if 75% of the complex took a special resolution.”

While there are many misconceptions about the latest Constitutional Court ruling on marijuana, Constas stresses that it simply reinforces the right to privacy. She says that in a sectional title development, where neighbours live in close proximity to one another, that can be a complex concept.

HOMEFRONT RETAIL BAROMETER

Africa open for business Retail opportunity beckons on the continent —follow the trends as global chains take up the slack WORDS: GEORGINA GUEDES :: PHOTOS: SUPPLIED AND SHUTTERSTOCK

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t the API Summit in Sandton on September 20 and 21, developers and investors discussed opportunities on the African continent. Retail expansion is an important area of property investment enjoying rapid growth.

While the “Africa Rising” narrative has lost some conviction in recent years, largely in the wake of Nigeria’s oil price crash and SA’s ongoing lacklustre performance, there remain nations worth investing and doing business in, thanks to

their growing economies and focus on innovation.

“We saw how Rwanda welcomed the first drone airport in the world, Google turned towards Ghana for its new AI headquarters, Mauritius has become the gateway for innovative financial services, Senegal and Burkina Faso are leading innovative agriculture, Kenya and SA are tapping into IT, and Botswana is showing us stability in a torn post-colonial Africa,” said Gaetan Siew, chair for Port Louis Development Initiative and special envoy, UN-Habitat,

01 Global retailers Retailers from around the world — including South African brands — are already invested in Africa.

“Several chains are active, including French cosmetics brand Yves Rocher, Turkish clothing store LC Waikiki, low-cost Chinese retailer Miniso, and of course, Shoprite, Game, Mr Price, Carrefour and Decathlon,” says Garcier.

Mauritius, in his keynote address at the summit “Innovation is already happening, and the Africa we dream of, the Africa built on hope, may already be there.”

OPTIMISM Even in Nigeria, with its oil-based economy that has struggled to recover from the oil price decline, there is cause for optimism.

“We’re still positive that the retail office and other markets that we manage as Broll in Nigeria will see a recovery,” said Gavin Cox, Broll Property Group Nigeria head of retail management

and retail leasing.

The growth potential in Africa naturally provides opportunity for retail expansion into the continent. Sagaci Research MD Julien Garcier is optimistic about Africa’s retail prospects, believing that there are a great number of untapped opportunities available across the continent.

“Many African markets still have limited structured retail available in key categories such as fashion, sports and DIY,” says Garcier.

These are Africa’s retail trends:

02 Growth potential Certain countries offer significant growth potential, especially in specific categories.

Garcier says opportunities are enormous in countries experiencing sharp growth, such as Ivory Coast and Ghana.

He says that Kenya is enjoying keen interest from foreign retailers.

03

04 Discounts Garcier says that there is often an African perception that shopping in malls is more expensive than buying from traditional retailers, such as those found in markets.

For this reason many retailers are aggressively pricing staples. For example, Carrefour in Kenya and the Ivory Coast have low prices on sugar, flour and edible oil, typically products where consumers have a very good understanding of the prices in traditional retail.

“They need to convince them that they are cheaper, and that if they shop there, they will get good savings,” Garcier says.

The cash-and-carry wholesale model also works to attract small retailers and consumers who may buy in bulk. SA’s Jumbo is one such example. This cost appeal, Garcier says, moves customers across to modern retail and then draws them further into the store or mall.

Adaptability Foreign retailers should adapt their business for local conditions and customs.

Jonathan Lotter, asset manager for Broll Property Group, Ghana, says that it is often too easy to spot the South African retailer in the Ghanaian market. There is no winter in Ghana. “It’s hot all year round, but they have jackets and

Kumasi City Mall in Accra, Ghana

boots in their store displays during SA’s winter season.”

He says that this lack of commitment to each local market will lead to retail failure on the continent.

“You have to decide whether you are going to do it, or not do it.

You have to adapt your business model to local conditions.”

HOMEFRONT 05 Location Location is everything — but that doesn’t mean pick the “best” one.

“Retailers need to ensure that they find the right location — an issue made complex by the fact that there just aren’t that many suitable spaces available,” says Garcier.

One smart option for retailers is to pick high-traffic locations in transit areas, by researching to find the best side of the road, says Garcier.

“Instead of going into a mall

where the rent is high, some players look for roadside locations.

This is often the case with food and beverage outlets, but also other categories such as supermarkets and pharmacies,” he says.

While these transit areas might not themselves be located in appealing areas, the shopper traffic that flows through them is often from the middle and upper classes, enabling these outlets to catch the passing custom.

06

Entertainment Due to traffic congestion, people in African countries will, as a rule, shop locally during the week and travel greater distances to visit malls at the weekend.

Garcier says for this reason mall managements need to find ways to keep them there, often in the form of entertainment, to ensure that their weekend activity makes up for the quieter weekdays.

“There’s a very big entertainment aspect,” says Lotter. Of the people coming to malls, 30% to 35% come for the entertainment or the social aspect, instead of just pure shopping.

This affects the way malls are built. It is difficult to keep people at strip malls, says chief information officer of Novare Equity Partners Pierre Groenewald, explaining how malls are constructed in Lagos, Nigeria. “People visit those for convenience shopping.”

Novare’s strategy is to keep people at the facility to socialise — to draw customers past line shops towards anchor tenants in the interior shops, spaces and courtyards, says Groenewald.

07 08 Ethiopia

“Many African markets still have limited structured retail available in key categories such as fashion, sports and DIY” Julien Garcier, MD, Sagaci Research

Everyone’s talking about Ethiopia.

It is Africa’s fastest-growing economy and the IMF forecasts that its GDP will grow 8.5% in 2018. This means that there are many opportunities for all types of investment — but retail in particular — in the East African nation.

“There is 45,000m 2 of gross lettable area under construction and most will open in the coming months,” says Groenewald.

“Everyone is excited that the market is opening up.”

Online integration With the proliferation of smartphone use on the African continent (some estimates suggest 66% penetration was achieved this year), there is increasing interest in online shopping. While many potential customers do not have faith in this channel (and are, in fact, still resistant to shopping in malls), retailers would be remiss to ignore this avenue.

Adriaan Otto, Africa originator at Massmart, which recently opened a new Builders Express in Kenya, says that they have begun an online channel that allows for ordering, but not delivery. “It’s click-and-collect. Customers can order from our website, then come and collect. If we don’t carry the item in the store, we might have to order it — but the system works. People are using it.”

THE LUXURY YOU WANT THE LIFE YOU DESERVE

C O M E J O I N U S F O R A C O F F E E AT L O O F W H I C H HAS OPENED ON OUR PIAZZA DECK OF THE HOTEL T H E H O U G H T O N H O T E L I S N E A R I N G C O M P L E T I O N . W E A R E P L U S - F I V E - S TA R S E X C I T E D .

Experience the tranquillity of nature, breathe fresh air, marvel at the vistas across the golf course, and enjoy having a five-star hotel, spa and gym on your doorstep – all in a secure environment.

This can be your lifestyle, in the heart of Johannesburg.

While at The Houghton, come visit us in our newly decorated Pellerade Designs penthouse, Unit 8555, where you can experience the surreal views and serenity first-hand.

OSBORN RD

M1

HOUGHTON GOLF CLUB

2ND AVE

Luxury apartment 8555, is available daily for viewings.

WARREN BECKER 082 302 3004 | warren@thehoughton.com ASHLEIGH SMITH 073 220 7357 | ashleigh@thehoughton.com Houghton on 12th, 53 Second Ave, Houghton | Show apartment 8555

HOMEFRONT PROPERTY NEWS

R300m V&A urban park ready to launch

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new 12ha green space forming part of the Waterfront’s Canal District opens this month. The urban park will be the gateway to Cape Town’s V&A Waterfront.

Battery Park features pedestrian walkways along the canal, a piazza with paved walkways, benches and indigenous gardens.

Other elements include a basketball court, children’s

play area, grassed and landscaped recreational areas, a pavilion for hosting events and eateries, and coffee shops.

Named after the Amsterdam Battery built by the Dutch in 1784, the elevated park offers views across the V&A Waterfront and surrounding city streets.

The family area will include a jungle gym,

swings, rocking horses, a scooter path and outdoor recreational activities for teenagers. Battery Park will host a range of water sports from standup paddleboarding to kayaking and swimming.

A four-storey public parking facility has been constructed beneath the park with entrances via Alfred Street or Dock Road.

Student residence set to open near UCT

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ape Town student residence Claremont Roscommon will open to residents in January 2019.

Built by Respublica and Redefine Properties opposite Cavendish Square, the residence will house 582 post and undergraduate students in a variety of accommodation formats purpose-built

for differing affordability and personal needs.

Students can choose from studio apartments, single and shared rooms and four-sleeper apartments with communal kitchens and lounges.

The rooms and apartments will be spread over six floors atop two levels of basement parking.

Roscommon includes

recreation and relaxation spaces, a gym, computer centre and study spaces.

Residents will have free uncapped, unlimited Wi-Fi. “Roscommon’s central location relative to the lifestyle offering of Claremont and proximity to UCT makes it a convenient and appealing option for students,” says Respublica CEO Craig McMurray.

Mall of Africa lights up

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he Mall of Africa has unveiled what it says is the largest rooftop solardiesel hybrid power system in the world.

The installation covers most of the available

roof space at the mall, an area of about 4.5ha. The system is estimated to be capable of producing 7,800MWh annually.

Attacq is a Mall of Africa co-owner. Michael Clampett, head of retail

asset management at the company, says the project will see the mall produce sufficient power to support its day-to-day electricity requirements while also decreasing its overall carbon footprint.

Fourways Precinct boost for the Lonehill area

T Western Cape estate racks up R1.2bn sales

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he luxury Val de Vie Estate near Paarl achieved record sales of R1.2bn over the past 12 months.

Resale transactions of more than R885m were concluded on the estate, a 61% increase over the previous 12 months. Developer sales reached R338m.

“Under challenging circumstances, our

success factors have been our strong and consistent brand, world-class security and an unrivalled lifestyle offering in one of the most beautiful places in SA,” said Val de Vie Estate shareholder and marketing director Ryk Neethling.

Val de Vie Estate phase 2, excluding the Val de Vie Evergreen retirement facility, is

95% sold out. Val de Vie Evergreen is 70% sold out on phase 1 — the first residents are expected in mid-2019.

Stellenbosch is now only 15 minutes from the new Berg River Gatehouse that connects the estate to the R45 Simondium Road, allowing for reduced travelling times because of faster access to the N1 highway.

he value of properties in suburbs surrounding Fourways in Johannesburg are set for a boost from the development of Fourways Precinct.

Jawitz Properties Sandton agent Ashe Thaver says this prime shopping and business destination — announced

by Accelerate Property

Fund last year — is expected to attract international business. Proximity to commercial and residential development Steyn City is a further attraction.

“With Sandton and its surrounds being saturated and traffic a nightmare, the Fourways Precinct is well overdue and will benefit the value of property sales and rentals in the surrounding

areas such as Lonehill and Beverley,” says Thaver.

Properties in the area range from R750,000 to R1m for sectional title developments, and from R2.5m to R5m for freestanding homes. “We have seen a consistent annual rise in property prices over the past 10 years and expect this trend to continue,” says Thaver.