Published recently, by the Cape Town Central City Improvement District (CCID), the report noted that the Central City “held its own quite remarkably” in the year under review, despite 2019 being “incredibly difficult”, according to CCID board chairperson Rob Kane.
Says Kane: “Stakeholders and investors in the CBD have had to cope with the aftermath of the 2018 drought and subsequent water crisis, ongoing load shedding and a tough economic climate.”
Five-part section on on ‘Surviving Covid-19’
Though the coronavirus pandemic falls beyond the ambit of the SCCR report, a five-part section of the report is devoted to reflections on “Surviving Covid-19” by Wesgro CEO Tim Harris, Economic Development Partnership CEO Andrew Boraine, HTI Consulting CEO Wayne Troughton and economist Brian Kantor of Investec Wealth and Investment and Arthur Kamp, chief economist, Sanlam Investments.
Kane acknowledges the “global devastation” Covid-19 has caused, noting that it “has damaged the Central City’s economy”, but its economic performance means the Central City is well-placed to navigate a path to recovery.
Property evaluation
The SCCR report shows that, according to the City of Cape Town’s 2018/2019 property evaluation, the value of Central City property stands at R44.124bn, and that the total value of property investments in the Central City – recently completed, under construction, proposed or planned – is R13.83bn.
This is broken down into:
- R1,045,000,000 – A conservative estimate of the value of property completed in the Central City during 2019 but which still has to be officially assessed by the City of Cape Town (seven projects);
- R3,730,000,000 – The value of property, conservatively estimated, that is under construction (14 projects);
- R5,196,000,000 – The value of property, conservatively estimated, that is currently in the planning phase (11 projects); and
- R3,860,000,000 – The value of property, conservatively estimated, that is currently proposed and is expected to begin construction within the next two years (six projects).
The Foreshore precinct has emerged as a key property investment node which is due, in part, to the expansion in 2018 of the Cape Town International Convention Centre (CTICC), which achieved a turnover of R277m in 2018/2019. “This world-class venue, which contributed R4.5bn to the Western Cape GGP, was a key driver in 2019 of the Central City’s visitor economy as well as its knowledge and eventing economy, all of which continued to expand in 2019.”
The eighth edition of the SCCR reflects on the bigger picture of the economy of the Central City, looking at property trends, occupancy rates of commercial and residential buildings, retail vacancies, the prominent economies of the Central City and trends in commercial and residential markets.
Among other key findings in the report are that:
For the third consecutive year, Cape Town had the lowest overall vacancy rate of 7. % of the country’s five largest metros. According to the SAPOA Office Vacancy Report (Q4 2019), the city’s vacancy rate compares very favourably to that of Johannesburg (12.5%) and is well below the national office vacancy rate of 11%.
The Central City vacancy rate has continued its gradual decline from a peak of 11.8% at the end of 2018 to 10.8% at the end of 2019 – a decline of 15,127m2 of space available for rent. This is at least partially attributable to the reduction in office space due to redevelopment during 2019.
A new urbanism trend gained traction in South Africa in 2019 in spite of a sluggish housing market, increasing demand for downtown living in the Central City. This has prompted the re-imagining of precincts in the Central City by developers into spaces where homeowners can live, work and play in areas that provide a safe and secure environment with easy access to work. With affordability a major issue for many young professionals, developers are responding with a growing number of studio apartments and co-living units within mixed-use developments. In 2019, small apartments with shared amenities officially became hot property, giving first-time buyers the opportunity to enter the housing market in a desirable city centre.
In 2019, the Central City residential market finally felt the effects of the economic and political headwinds which have dampened activity in the national and regional housing markets in recent years. The distribution of sales across the various price bands was similar to that seen in 2018, with the largest number of sales recorded in the R30,000 – R39,000/m2 category. No sales were recorded in the top price bracket (more than R60,000/m2) last year, while two sales were recorded in 2018.
The report includes separate sections providing a detailed look at key elements of the Central City economy, including:
- The Art Economy: With Cape Town firmly established as the art capital of Africa, the financial contribution of the creative sector to the Central City economy is undeniable;
- The Visitor Economy: With three new hotels opening in the Central City in 2019, several mixed-use developments and aparthotels either being constructed or in the pipeline, the CBD’s multi-layered visitor economy continued to expand in spite of a tight economy;
- The Night-time Economy: There is growing awareness of the potential of the Central City’s night-time economy, but it remains an unexplored resource. A recent research partnership between the City of Cape Town, the CCID and the University of Cape Town will provide a better understanding of the night-time economy of the Central City and how to better use the night as a resource for social and economic development; and
- The Knowledge and Eventing Economy: The Central City’s knowledge and eventing economy continues to expand every year, driving business into the region as local and international visitors and business tourists stream into the CBD to attend official events and conventions in and around the public spaces in downtown Cape Town.
The report also features a detailed analysis of residential and commercial rentals, and highlights from the CCID’s residential and retail surveys.
For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email info@relocationafrica.com, or call us on +27 21 763 4240.
Sources: [1], [2]. Image sources: [1], [2].
New Lock-down Change for South African Schools
Basic Education minister Angie Motshekga has published a new gazette which will allow for the resumption of some sports at South African schools.
The directive states that the following activities are permitted to resume, subject to social distancing, hygiene and safety measures and without spectators:
The number of persons in the sporting venues, change rooms or training area, at any given time, must not be more than 50% of the capacity of the venue with persons observing the social distancing requirements.
In addition, schools that compete in inter-school format must adhere to the limitation of:
Other regulations include the wearing of face masks expect when playing, the provision of hand sanitisers and the keeping of a register for all participants.
Social distancing rules in classrooms
The resumption of sports comes after Motshekga said that her department will make further changes to the country’s schools as it continues to grapple with the coronavirus pandemic.
Motshekga told the SABC that key among these changes will be a review of the social distancing rules in classrooms.
The minister indicated that the current ‘rotation system’, where students alternate days at school, meant that too much learning time was being lost.
Instead, her department is looking at other measures, such as body screens, to get more children into classrooms safely.
“We are looking also at other measures. Other big schools for instance are using body screens not distancing because physical distancing is very expensive for us because it means we have to cut classes in half,” she said.
Motshekga said that schools had to cut out some parts of the curriculum because of the reduced contact time.
To make up for the teaching time lost to the coronavirus lockdown, the department has already trimmed the curriculum nationally. Parts of the 2020 curriculum will be carried over into 2021.
For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email info@relocationafrica.com, or call us on +27 21 763 4240.
Sources: [1], [2]. Image sources: [1], [2].
A Discussion About Emerging Market Relocation
Significant segments of this article were originally published by Executive Expatriate Relocations Middle East (EERME).
As the world collectively attempts to combat the impact of the recent global pandemic, much of the focus is on rebuilding and strengthening economies. Governments and organisations continue to determine which avenues and actions will be most beneficial, both in the short term and the long term. One undeniable source of economic growth is geographical expansion, particularly into areas that will be a catalyst for new consumers and new revenue streams; this is where emerging markets come in. For many companies emerging markets offer a unique opportunity for development, but any potential prosperity is highly dependent on a successful relocation strategy, which can be more challenging than expected.
Our MD, Rene Stegmann, recently joined EER’s Marie O’Neill, Elite Woodhams Relocation’s Anna Kavelj, and A.P. Moller-Maersk’s Tamlyn Kuhn in a EuRA webinar about Considerations When Relocating to Emerging Markets. Together, they examined the crucial considerations required to take advantage of this lucrative arena.
The Importance of Emerging Markets
Coined by the World Bank in 1981, this phrase is intended to apply to any country or economy that has “some characteristics of a developed market, but does not fully meet its standards”. Unsurprisingly many countries have found themselves shifting in and out of the moniker as their status adapts or circumstances change. Essentially though, markets that fall within and around the definition of ‘emerging’ continue to be of great interest when it comes to international expansion. Emerging markets offer enormous potential for diversification and growth. They often feature an ambitious population, fresh, creative talent, amenable governments and, of course, new demographics of consumers. In the past engagement with emerging markets has helped propel the fortunes of organisations and the economies of their home nations exponentially and in turn transformed the landscape of the engaged market. In order to fully integrate with an emerging market, a company needs to facilitate a smooth relocation process and that is only possible if proper adherence is given to the challenges and obstacles that might be faced and expert help sought on how to avoid or overcome them.
Preparation, Preparation, Preparation
Just so you know we really mean it. Preparation is absolutely critical when it comes to emerging market relocation. Ensuring that you can do this successful is entirely related to your local connections. Without the proper research and knowledge, it becomes almost impossible to navigate the nuances of new destinations and avoid costly mistakes. Those considering relocation must ensure they have trusted in-country partners with expert local knowledge and an unimpeachable sense of how things work on the ground. By investing in forging those connections it is then possible to determine key aspects that will be required from your employees, your administration and your budget. Regional insights are always invaluable when it comes to relocation and that expertise can ensure a smoother process that means assignees can focus on their role and get stuck in from day one. Local partners can advise on elements such as:
A Collaborative Approach
When any company is looking at emerging market relocation, the chance of success can be significantly increased if they adopt a collaborative approach across the whole organisation. Every department needs to be comprehensively briefed so that objectives are understood and actions taken that facilitate their achievement efficiently. Procurement, HR, Senior Leadership and others need to make sure they are on the same page. By implementing a robust talent management approach they can ensure they have the right people helping them on the ground, the right people coordinating the company’s new strategy and the right people to cope with the stresses of relocating their life.
Communication is King
As with many areas of business, communication is incredibly important. Any company looking to relocate to an emerging market needs to make sure it can effectively communicate with:
Prioritizing communication and ensuring it remains consistent throughout the whole process can be a huge factor in avoiding potential pitfalls such as complex business requirements and ‘lost in translation’ mistakes. It will also help to manage expectations. Expert DSPs will be able to communicate key information and potentially surprising aspects. They can relay that things may well work differently than expected such as overall concepts of time, common cultural attitudes, political upheaval, technology holes and problematic infrastructure. They can also coordinate cultural training that can provide invaluable knowledge for the company and the assignee to understand their new environment and hit the ground running.
Ultimately emerging market relocation isn’t right for every company. They need to weight the risk and reward elements of any expansion decision to prevent costly issues. Companies need to research the proposed location, connect with local experts, foster effective communication and choose the right assignee to undertake the challenge. If they can successfully do those things then they are left with nothing but potential and opportunity.
To watch the recorded webinar, click here, or watch it in the media player below.
To discuss relocating to emerging markets in more detail with us, and to find out how we might assist you with relocation services across Africa, feel free to contact us via the details below, or visit our website by clicking here.
For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email info@relocationafrica.com, or call us on +27 21 763 4240.
Sources: [1], [2]. Image sources: [1], [2].
2019 State of Cape Town Central City Report Launched
Published recently, by the Cape Town Central City Improvement District (CCID), the report noted that the Central City “held its own quite remarkably” in the year under review, despite 2019 being “incredibly difficult”, according to CCID board chairperson Rob Kane.
Says Kane: “Stakeholders and investors in the CBD have had to cope with the aftermath of the 2018 drought and subsequent water crisis, ongoing load shedding and a tough economic climate.”
Five-part section on on ‘Surviving Covid-19’
Though the coronavirus pandemic falls beyond the ambit of the SCCR report, a five-part section of the report is devoted to reflections on “Surviving Covid-19” by Wesgro CEO Tim Harris, Economic Development Partnership CEO Andrew Boraine, HTI Consulting CEO Wayne Troughton and economist Brian Kantor of Investec Wealth and Investment and Arthur Kamp, chief economist, Sanlam Investments.
Kane acknowledges the “global devastation” Covid-19 has caused, noting that it “has damaged the Central City’s economy”, but its economic performance means the Central City is well-placed to navigate a path to recovery.
Property evaluation
The SCCR report shows that, according to the City of Cape Town’s 2018/2019 property evaluation, the value of Central City property stands at R44.124bn, and that the total value of property investments in the Central City – recently completed, under construction, proposed or planned – is R13.83bn.
This is broken down into:
The Foreshore precinct has emerged as a key property investment node which is due, in part, to the expansion in 2018 of the Cape Town International Convention Centre (CTICC), which achieved a turnover of R277m in 2018/2019. “This world-class venue, which contributed R4.5bn to the Western Cape GGP, was a key driver in 2019 of the Central City’s visitor economy as well as its knowledge and eventing economy, all of which continued to expand in 2019.”
The eighth edition of the SCCR reflects on the bigger picture of the economy of the Central City, looking at property trends, occupancy rates of commercial and residential buildings, retail vacancies, the prominent economies of the Central City and trends in commercial and residential markets.
Among other key findings in the report are that:
For the third consecutive year, Cape Town had the lowest overall vacancy rate of 7. % of the country’s five largest metros. According to the SAPOA Office Vacancy Report (Q4 2019), the city’s vacancy rate compares very favourably to that of Johannesburg (12.5%) and is well below the national office vacancy rate of 11%.
The Central City vacancy rate has continued its gradual decline from a peak of 11.8% at the end of 2018 to 10.8% at the end of 2019 – a decline of 15,127m2 of space available for rent. This is at least partially attributable to the reduction in office space due to redevelopment during 2019.
A new urbanism trend gained traction in South Africa in 2019 in spite of a sluggish housing market, increasing demand for downtown living in the Central City. This has prompted the re-imagining of precincts in the Central City by developers into spaces where homeowners can live, work and play in areas that provide a safe and secure environment with easy access to work. With affordability a major issue for many young professionals, developers are responding with a growing number of studio apartments and co-living units within mixed-use developments. In 2019, small apartments with shared amenities officially became hot property, giving first-time buyers the opportunity to enter the housing market in a desirable city centre.
In 2019, the Central City residential market finally felt the effects of the economic and political headwinds which have dampened activity in the national and regional housing markets in recent years. The distribution of sales across the various price bands was similar to that seen in 2018, with the largest number of sales recorded in the R30,000 – R39,000/m2 category. No sales were recorded in the top price bracket (more than R60,000/m2) last year, while two sales were recorded in 2018.
The report includes separate sections providing a detailed look at key elements of the Central City economy, including:
The report also features a detailed analysis of residential and commercial rentals, and highlights from the CCID’s residential and retail surveys.
For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email info@relocationafrica.com, or call us on +27 21 763 4240.
Sources: [1], [2]. Image sources: [1], [2].
Relocation Africa’s Monthly Social Responsibility Project, Month 2: Neighborhood Litter Collection
As part of our constant drive to give back to our community, our team has endeavored to join together to participate in a monthly community-focused CSR initiative. The team comes together each month to participate in an activity aimed at uplifting the community around our head office in Cape Town, after which ideas are put forward for the following month’s initiative.
In this way, as South Africans, we are giving back not only on Mandela Day, but throughout the year, as the need doesn’t end after the holiday.
Naturally, we take all necessary COVID-19-related precautions when participating in the activities, so as to ensure the health and safety of our team members and those we are interacting with outside our office.
For our second month, in October 2020, we came together to pick up litter in the neighborhood in which our head office is located (Kenilworth, Cape Town), with the theme of ‘A Healthier City’. We invited our neighbors to join us, and the team from Vulcan Integrated Solutions joined us on the collection walk. We split up into 3 teams, each walking different routes, to pick up any litter we found in the roads surrounding our offices.
Gallery
We hope this inspires our readers and other companies to start similar initiatives, as if we all work together, we can greatly improve the quality of life of those in need around us.
For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email info@relocationafrica.com, or call us on +27 21 763 4240.
Sources: [1], [2]. Image sources: [1], [2].