Durban’s CBD Set For Transformation
A CBD or Central Business District is the focal point for commercial, retail, governmental and residential activity, as well as transportation networks. For centuries, it has been the heart of a city, and in recent times, it has evolved to include contemporary mixed-use developments which have breathed new life into CBD’s.
Unfortunately, throughout the decades, Durban’s commercial growth and development have greatly excluded its CBD, with private developers and government opting to expand into nodes towards the north of Durban. This has resulted in abandoned and dilapidated buildings around the CBD, which further entrenched lacklustre investor and developer confidence.
Rejuvenation Project Implemented
Noticing these dire conditions, the eThekwini Municipality, alongside private developers, embarked to rejuvenate and redevelop the city centre in order to place it on a new and international league. Officially launched on September 15 by the municipality, the project places emphasis on cleaning up, restoring bad buildings and tackling crime-related issues such as illegal trading.
Labelled as robust and radical, one of the main goals of the project is to attract more investors and create employment. According to Ryan Berry, Managing Director of Deal Core Property Group, he is noticing heightened interest in Durban’s CBD and has recently facilitated the sale of three adjoining properties in Quadrant House on the corner of Joe Slovo Street and Margaret Mncadi Avenue. Berry says that the intention is to redevelop these properties into A-Grade offices coupled with ample parking space.
He adds that the offices were bought for buy-to-let purposes and are now on the rental market. Mandated by Deal Core Property Group, the offices come fully fitted with air-conditioning, a total of 20 parking bays and high-security measures. In addition to this, it has incredible views of the Durban Harbour and the Victorian Embankment. Quadrant House boasts five stories of prime office space totaling 1555m, and intricate architectural details make it a rare find. These include timber doors and sidelights at the entrance, oriel windows, entablatures balconies, arched openings, and loggias. For entertainment purposes, including corporate functions, the roof has been converted into a roof deck entertainment area, ideal to celebrate special occasions.
The rejuvenation of the CBD is attracting many new businesses, and the latest JLL Durban Office Market Report indicates this. The report states that as a result of a high demand for rental properties, rental prices have surged, with landlords asking for an average of R95/sqm for A-grade rentals compared to R75/sqm in the second quarter of the year. However, although asking prices are increasing, the area is the most affordable when compared to Berea, uMhlanga/La Lucia Ridge, Westville and Hillcrest-Kloof, where prices can reach up to R135/sqm.
The first phase of the programme has already been implemented and it involved City Officials ensuring cleanliness and safety, and compliance with Municipal by-laws within the city centre. The second phase is soon to be implemented and will involve appointing a dedicated team to manage the CBD and ensure that progress made in phase one is maintained.
Fundamental to the project is a new bylaw adopted by the municipality, titled, Problem Building, which provides for the identification, control and rehabilitation of problem buildings and creates offenses and penalties in the event of building invasions in areas within and surrounding the city centre.
The suburbs that will directly benefit from the project are uMbilo, South Beach, Point Waterfront, North Beach, Morningside, Berea, Glenwood, Victoria Embankment and the Albert Park Precinct.
Point Waterfront, in particular, is receiving massive media coverage as a new precinct by the Durban Point Development Company (DPDC) is planned to commence at the end of the year. The company is co-owned by the eThekwini municipality and the Malaysian property group, UEM Sunrise. It is modeled along the lines of developments in Miami, Cannes and Copacabana. Currently, investment in the Point development is R2 billion and it is expected that the total investment will reach over R6 billion.
Two key features of the precinct have already been announced, these include a Cruise Line Terminal and the construction of a new beach promenade that will extend from uShaka to the harbour entrance. The precinct will span 750 000 sqm, and will boast high rise skyscrapers reaching up to 55 storeys.
As Durban’s CBD gradually transforms back to its former glory, developers, investors and businesses are beginning to realise the high potential in the area. Even though rentals are remaining affordable, trends are showing that the restoration process is driving up demand, and subsequently prices, for commercial rental properties. This means that the time for businesses to expand into or relocate to the CBD is now, as in the future rental prices will increase alongside massive development.
Author: Deal Core Property Group