2013 - Maboneng Precinct

UNREALISTIC OPTIMIST BY JULIET PITMAN. ENTREPRENEUR MAGAZINE (COVER STORY), FEBRUARY 2013 20 21 21
In downtown Johannesburg on the far
east side of the city a group of twentysomething-year-olds
are running a
neighbourhood that they’ve transformed
from a no-go area into a hip, vibrant urban
community. Take a walk down the street
here and you’ll pass trendy restaurants
and coffee bars. Look up and you’ll see
modern urban apartments and rooftop
hangouts where young professionals,
creatives and entrepreneurs take in the
sunset over the city skyline. There are
art galleries, collaborative work spaces,
cinemas and there is an eclectic mix of
people on the street – international tourists
and homecoming-revolution expats,
businesspeople, students and artists. The
pavements are clean and tree-lined and
the area is well-maintained. It’s an equally
far cry from the seedier areas of town and
the high-walled, electric-fenced suburbs
of the North.
This is the Maboneng Precinct and
ten years ago its very existence would
have been unimaginable. The east side
of Johannesburg was seedy, crimeridden
and dilapidated. (Much of
central Johannesburg still is). The Stock
Exchange and big business had long
since moved out, making Sandton the new
CBD. Respectable people didn’t want to
drive through there; the suggestion that
they live there would have been at once
horrifying and laughable.
And then a youngster came home from
a gap year overseas, and felt an aching
longing for the urban lifestyle he’d
experienced and come to love in cities
around the world. Why, he asked, wasn’t
the same thing possible in Joburg.
His name is Jonathan Liebmann and what’s
remarkable about his story is that he has
almost single handedly been responsible
for breathing life into Maboneng. There are
of course countless examples of urban
renewal in cities around the world but
most of them required the intervention of
a forward-thinking mayor or no-nonsense
police chief to clean up the crime, and the
strategic input and collective effort of a
dedicated municipality – not to mention
some kind of incentive scheme to entice
business and people back to the city.
Maboneng has had none of that and yet
its achieved what most people would
have thought impossible. Not only has it
attracted individuals, businesses, tourists
and retailers, but it’s become sought-after,
trendy, the place to see and be seen. Visit
Market on Main – the market in the Arts on
Main block – on a Sunday morning and
you’ll struggle to find parking. The hotels
and apartments are all 100% occupied
or sold. This is not a lone street that’s
being doggedly occupied by some brave
coffee vendors and a couple of urbanites
wistfully trying to make believe they’re
in London/New York/Paris. This is a fullfledged
neighbourhood. People live, eat,
work, shop, socialise and run businesses
here. It has a beating heart and an energy
all its own.
And it exists because Liebmann and his
team at Propertuity managed to sell a
master vision of what the district could
be – if people overcame their negative
perceptions of the city, if the crime issue
could be addressed, if a critical mass
could be achieved to create a sense of a
community. That’s a lot of ‘ifs’.
However Liebmann doesn’t like the
suggestion that he is Maboneng. “The
neighbourhood is the people who live,
work and love it here. Its energy and
personality comes from them. A place
can never be about a single individual,”
he says. He’s right, of course. Maboneng’s
success lies in the fact that it has taken on
a life of its own, one that exists outside of
Liebmann’s head.
But it was there that the precinct had its
birth. Desperate to live some kind of urban
lifestyle when he returned from overseas,
Liebmann started looking for a place in
the city he could convert into a work and
live-in space. He had some experience in
property, having purchased, rennovated
and sold a few flats, the first of which was
in Waverely when he was just 18 years old.
“I found and converted a small factory
space near 44 Stanley in Milpark and
in doing so realised two things. Firstly,
that these these old factory spaces had
development potential to become new
live-and-work spaces, and secondly that I
didn’t want to just do my own apartment. It
was then that I knew I wanted to become
a property developer,” he says.
It was an important moment in his
journey. Liebmann had run a number of
entrepreneurial businesses, including a
cleaning business and a mobile coffee
enterprise, with varying degrees of
success. “I’ve been running businesses
since I was 15 but it wasn’t till I realised
that I was passionate about property
development that I really came into my
own. Up until that point I’d been a bit
scattered, looking and pursuing a range
of opportunities. They were more or less
successful but I think of that period as
my school fees phase. I was learning
important stuff - about business and
about myself. It all came together when I
realised what I really wanted to do with my
life. The passion I felt helped me hone my
focus,” he says.
Backed by his silent partner and financier,
Liebmann turned his attention to finding a
place where he could start to implement
his vision. He purchased the buildings
that would become the now-famous
Arts on Main - a unique blend of studio,
commercial and retail space that acts as
a hub for creatives and artists.
While he was creating Arts on Main he
started thinking more broadly. “That’s
when the idea for Maboneng was born
really. I started thinking about the whole
neighbourhood, the transformation of
whole east side,” says Liebmann.
Having the vision is one thing. Singlehandedly
creating a neighbourhood is
another. So how did he do it? “I think there
are a number of things that came together
to bring about the success of Maboneng.
In the early days I became completely
and utterly immersed in the project.
This was absolutely critical. I lived and
worked in the space. I was construction,
marketing, sales and financial manager. I
did everything. It became who I was and
I think that level of passion must deliver
results eventually,” he says.
He’d also identified the right initial target
market. Arts on Main focused on creative
people. “While travelling and in my time
living near 44 Stanley I’d learned that
artists and creatives are often the best
catalysts for change. They are the perfect
first adopters. It’s not in any way unique
to Arts on Main. It’s been proven in
many cities throughout the world. It was
important to get them in as they would
become the foundation of the community,”
he explains.
Turns out he was right. The influx of
creative people helped to create interest
and curiosity in the media and general
public. “Maboneng was only going
to be successful if we coudl reach a
critical mass. You can’t have a vibrant
neighbourhood of ten people. That’s a
vibrant apartment block. We also needed
critical mass and to buy up stock in the
neighbourhood so that the area would
be sufficiently owned by us to justify the
cost of upgrading all the infrastructure,
the lights, the trees, the pavements, the
security and the like,” he adds. The fact
that Propertuity, not the City, has done all
these things is remarkable in itself.
Another key success factor was brilliant
design. “I think the most important thing
about our company is that we are very
good at design. That’s our differentiator
and its my particular talen. If you asked
what differentiated us from other property
developers that would be it. We know how
to design spaces. I have an excellent
architect and together we’re a good
team,” Liebmann explains.
The company also knows what its about
when it comes to marketing. The design,
marketing and sales teams work together
very closely to sell the vision. “And
because we keep executing on the vision,
it strengthens people’s belief in it, and
that in turn drives the growth of the whole
venture,” he says.
Maboneng’s evolution included the
development of Main Street Life, the first
residential building in the portfolio with
194 apartments, a 12-room hotel and a
cinema and retail on the ground floor.
It was followed by the Main Change
(45 office spaces), Revolution House
(32 apartments and film and recording
studios), and Fox Street Studios (a liveand-work
concept where is floor is sold or
rented to a different person).
It helps that the area is also extremely welllocated
in the middle of Johannesburg,
which means it makes a lot of sense for a
lot of different people and businesses to
make it their base.
In every property the ground floor is
always retail and restaurants, driving the
neighbourhood’s unique engagement with
the street. “Our portfolio is 60% residential,
20% industrial, 10% commercial, 10%
retail. The idea is to have a complete
and sustainable community that offers
everything. People want an integrated
space where they can go downstairs,
watch a move, eat in a restaurant, walk
everywhere and ride on a bicycle,” says
Liebmann.
It’s no small irony that this is the stated
wish-list of almost every person who
buys into one of Johannesburg’s gated
communities. Of course there is the
unhappy issue of crime to discuss, and
Liebmann is not a denialist when it comes
to this most notorious aspect of Jozi.
“There’s no question - the crime in South
Africa is out of control. However, the
perceived crime in the city is not as bad
as people think. Statistically, you have a
higher chance of falling victim to crime
in Sandton than you do in the city. So it’s
been partly a matter of changing people’s
perceptions,” he says.
That said, however, he recognises that
the divide between the rich and the
poor will always lead to crime. “We have
implemented a number of unobtrusive
security measures such as private security
guards, and we’ve worked hard to foster
community interaction. It’s important in any
neighbourhood for people to know each
other. But this is also a micro-economy
- we offer both affordable and high-end
products, and in between our properties
are people who are poor. Hopefully in time
the upliftment of the area will bring greater
opportunities to these people and, with
our ethos of fostering and encouraging
entrepreneurship, they will stand to
benefit. This is a long-term solution to the
issue of crime,” he adds.
With such a successful blueprint for urban
renewal, Liebmann is unsurprisingly not
short of offers to work the same magic in
other South African cities, as well as those
abroad. He’s a typical young entrepreneur
in every other aspect except in his response
to such interest. “I don’t want to get ahead
of myself. I don’t want to become one of
those developers who talks about crazy
expansion plans. For the next couple of
years, I’m not doing anything that’s not
Maboneng. Absolute focus is what has
made this project successful to date and
its a formula I intend sticking to. Sure the
others are tempting but I need to become
a specialist in this area. There will be time
in the future to explore opportunities to
replicate the model elsewhere, but that
time is not now,” he says.
His business partner and financier has
reinforced this position. “He’s been an
inspiration to me,” says Liebmann. There
are those who are quick to put all of
Liebmann’s success down to the fact that
he occupies the rare and enviable position
of having someone bankroll his dream. To
such detractors his response is simple:
“It is true that getting finance means
overcoming one of the big obstacles in
business. But it’s worth remembering a
number of things. Firstly, you don’t get
finance because you were lucky. Winning
the lottery is lucky. Given how difficult
everyone knows it is to get finance, you
have to work incredibly hard to prove
you’re worth of finance. The individual who
financed me has a philosophy of backing
the entrepreneur, not the business. He
backed me in previous ventures. What
he’s looking for (and he’s not unique in
this respect) is an entrepreneur with vision
and the ability to implement and make
things happen. I had to prove I had those
attributes.”
“The second thing is that getting finance
does not represent the end-goal. You never
have enough finance, even when you get
private equity funding. At the moment I
am looking for bank finance, so I’m in the
same boat as other entrepreneurs.”
“Lastly,” he concludes, “I believe that if
you show a properly successful business
model backed by your proven abiltiy to
implement, there is plenty of finance on
the table.”
Liebmann might be called visionary by
many, but those who give him this epithet
miss his true gift. It lies in his ability to
implement. Maboneng exists not just
because someone believed it could,
but rather because that person had the
ongoing, relentless, indefatigable energy,
determination, courage, fearlessness
and business sense to make the vision a
reality.
2013