economic advantages of johannesburg inner city - Joburg

9. LOCALISED ECONOMY
9.1 ECONOMIC ADVANTAGES OF JOHANNESBURG INNER CITY
May 12, 2010
The Westgate Precinct is located within the southern periphery of the Johannesburg Inner City and forms part of the City of
Johannesburg’s Administrative Region F. Economic advantages of the Inner City are:
• The inner city is well placed to attract and hold tenants, to the betterment of property returns.
• Host to major corporations, growing array of SMMEs, centre of legal administration, vibrant wholesale and retail trade, place of
cultural production, consumption and training, site of returning small manufacturing
• Rentals are competitive and particularly attractive for emerging businesses, supported by declining vacancies
• Various new projects are underway through Blue IQ, JDA, JPC, Private Landlords and private sector investors etc.
• Johannesburg has always been a one stop destination for people especially those depending on public transport
• Urban revitalisation is an ongoing trend, meeting the needs of land owners, tenants and residents.
• Demand stems from the emerging middle class, professional services and the arts/design sectors. From a retail perspective there is
a broad mix including nationals such as Foschini, Mr Price, Truworths, Game, Clicks, Woolworths, Ackermans, Jet, Charlie Parkers
and Edgars.
• The rejuvenation efforts has drawn public and private sector investment – Standard Bank, FNB, large retailers, and the investments
into residential conversion by the developers Urban Ocean, renewed commitment from large parastatals, mining giants and banks.
(Westgate Station Precinct Economic Scoping Report – February, 2010 )
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May 12, 2010
• Johannesburg Inner City is characterised by 7.0 million square metres of floor space - 3.0 million square metres of office floor space
– 2.15 million square metres A & B grade office space. This floor space is available in sizes ranging from 15m² to 2 000m²
• Retailers have a big demand for good well located premises but very limited supply exists. The retail box of opportunity can be
defined by Wolmarans Street, Von Willich, Commissioner, Sauer, Bree, Jeppe, Eloff, King George, Noord, Joubert and Wanderers.
• There is a strong informal trade component of which the annual turnover is estimated at R 4.2 billion. Management by MTC and
CJP – Markets include: Metro Mall, Faraday, Kerk Street, Quartz Street, Hoe Street, Park Station and Noord Street. Highest
concentration of informal trade along Bree, Plein, Jeppe, King George and Noord Street
• 400 000 to 500 000 cross border shoppers annually – contribution between R10 and R17 billion towards the City’s economy
• Approximately 35 000 residential units in the inner city – with overcrowding placing increased strains on current infrastructure. New
residential projects are being completed within the inner city with increased focus on the middle to higher income market
9.2 CORPORATE HEADQUARTERS AND SEAT OF GOVERNMENT
Figure 20 below indicates the location of corporate headquarters and seat of governance. It is evident that a number of these key corporate
headquarters and seat of governance are located within and just beyond the Westgate Precinct, boding well towards future development of
the precinct.
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Source: Demacon based on Johannesburg Inner City Urban Design Implementation Framework, 2010
Figure 20: Corporate Headquarters and Seat of Government
May 12, 2010
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9.3 UDZ AND CIDS
May 12, 2010
Figure 21 and Figure 22 below indicates the delineation of the Urban Development Zone and the various City Improvement Districts. It is
evident that less than half of the precinct falls within the UDZ (tax incentive) – excluding large portions of available vacant land.
A small segment of the precinct also falls within a CID – the South Western CID. This can also explain the reason why the eastern section
of the precinct reflects higher levels of management, maintenance and cleanliness.
The potential of extending CID 1 should be investigated or the development of a new CID or POA to support the regeneration and
development process in the area.
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Source: Demacon, 2010
Figure 21: UDZ Boundaries
May 12, 2010
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Source: Johannesburg Inner City Urban Design Implementation Framework, 2009
Figure 22: Urban Management CIDs
May 12, 2010
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May 12, 2010
9.4 CAPITAL INVESTMENT IN THE SOUTH WESTERN SECTOR OF JOHANNESBURG INNER CITY
Figure 23 indicates the past and pending capital investment projects within the north-western area of the Johannesburg Inner City.
Figure 23: Past and Pending Capital
Investment Projects
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Corporate Development include – Turbine Hall Refurbishment for AngloGold Ashanti, AA House for FNB, 11 Diagonal Street for ABSA
• New Corporate Parking Garages – FNB, AAC Centre, Standard Bank
• Residential Conversions – The Franklin, Isibaya House, Loveday Place, Harrison Place, Dogon & Ashanti, Mapungubwe
May 12, 2010
• Planned public space upgrades – Diagonal Street Precinct, Historic Indian Precinct, Westgate Inter-Modal Transport Precinct and
Upper Middle Income Residential Area.
• Neil Fraser indicated the following progress which has taken place within the surrounding areas over the past year in his CitiChat
end of 2009. Due to the location of the study area – focus is only turned towards the south, west and central areas of the inner city:
9.4.1 South
Large scale projects are being planned for southern strip of the inner city parallel to the M2 highway. Currently in Marshalltown:
• Behind magistrates‟ court, Main Square has been completed. Phase 1 represents the new head office for the Zurich Insurance
Company.
• To the south of the building, on the opposite side of Marshall Street, is the historic St Alban’s Mission Church. It is hidden between
Marshall Street and Westgate taxi rank.
• The proposal to accommodate some cross-border buses is not considered as the optimum use for scarce valuable land;
• Standard Bank has bought the Ussher site and is planning a massive development of offices and residential
• Slightly further west – iProp is planning a major residential development
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May 12, 2010
• A great deal of this southern strip is owned by the council for Pikitup, the Johannesburg metropolitan police department offices, large
bus area etc – and would be price space for redevelopment into some of the 70 000 residential units the City is envisaging via the Inner
City Charter. Land has become too valuable to be used for depots and storage.
• Four Star sectional title development the Mapungubwe Hotel Apartments – previous French Bank Building – completed
• A number of residential refurbishments from office space took place in the following buildings – Isibaya House, Loveday Place, Harrison
Place, Dogon, Ashanti.
9.4.2 West
• In Newtown, extension to the Sci Bono Science and Technology Centres are well advance
• The Horror Cafe opposite the Sci Bono Science and Technology Centre is being refurbished
• Just west of Sci Bono, demolitions of the adjacent building have been completed and the old Blue IQ office block is also slated for
demolition – these sites will be put out to proposal call.
• The new building to house Moving into Dance Mophatong will be completed shortly.
• On the north side of Newtown, foundation work is in progress on smallish site in Carr Street. Work is also in progress in replacing
pavements on opposite side of Carr Street and some of the railway sidings are upgraded for parking
• The refurbishment and renewal work to the Workers‟ Museum and Library is proceeding
• Turbine Square development housing AngloGold Ashanti has been completed
• Renewal refurbishment of the historic buildings between Gerald Sekoto and Jeppe Streets
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May 12, 2010
• At eastern end of Newtown is a rough open area with hundreds of taxis ranking on it – Council was keen to develop a major
international transport and shopping centre – however
• Between Diagonal and Sauer Streets, the basements to the new FNB development is progressing well - providing 1 830 parking bays in
four basement levels and sixth floors with four floors which will provide close to 20 000m2 of office space – completion date August
2010 is right on track
• The area centering on Diagonal Street has seen some exciting changes this past two years – FNB purchasing the AA building, ABSA
purchasing 11 Diagonal Street and completion of the Turbine Square Development
• Further north, on the corner of Bree and Sauer streets, is a new KFC and south of it a building under construction.
• Public environment upgrades – Diagonal Street and Chinatown.
• In regard to future developments:
o Initial planning on massive Carr street Development of retail, commercial and hotel is proceeding
o Museum Africa being upgraded
o Two projects on Central Place site – probably mixed use development
o The Transport House and Majestic Sites also earmarked for development – progress very slow
9.4.3 Central
• ABSA project is progressing at speed
• AFHCO and City Prop boards reflect on investment in restored and refurbished buildings
• The OPH developments clustered around and adjacent to Ghandi Square have certainly added to the look of the area
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• The partially destroyed Irish Barracks building is boarded off
• Construction activity around some of the provincial government precinct buildings – the Hotel, Rand Water Board and other areas
May 12, 2010
• A proposal has been submitted for the Barbican – part of a massive redevelopment by Old Mutual with some exciting public open space
suggestions
• Retail improvement district urban environment proposals
• On negative side but hopefully to become positive – the disruption caused by BRT works and too many buildings on the self-imploding
basis – Rissik Street Post Office, Trade Union Hall, CNA/Shakespeare/New Kelsey complex.
Overall, it is evident that the precinct is located within an area characterised by increased levels of capital investment – boding well towards
new development within the precinct – building on existing synergies.
9.5 RETAIL DENSITY DEMAND
Figure 24 below indicates the retail density demand within and around the Westgate Precinct. It should however be noted that this is based
on the resident population and does not provide for the commuter volumes moving through the precinct on a daily basis.
As mentioned previously the precinct does not have a strong resident population component – therefore the lower demand densities.
However, taking into account the commuter volumes introduced to the area via the four public transportation modes it is anticipated that
retail demand densities will be much higher.
These trends bode well towards retail development within the precinct. The extent however should be estimated based on up to date
commuter forecasts for these various public transport modes.
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Source: Demacon, 2010
Figure 24: Retail Demand
May 12, 2010
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9.6 RETAIL SUPPLY
From Figure 25, it is evident that no formal retail
centres are located in proximity to the Westgate
Precinct. A new retail centre of approximately
40 000m2 is also being planned for Newtown.
Atterbury aims to commence with the
construction after the Soccer World Cup 2010
festivities and aim to have it operational in
2012. This bode well towards convenience
retail development potential within the precinct.
Source: Demacon, 2010
Figure 25: Retail supply surrounding the
Westgate Precinct
May 12, 2010
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9.7 SWOT ANALYSIS
Diagram 1 summarises and
economic based SWOT analysis
conducted for the Westgate Station
Precinct.
Diagram 1: SWOT Analysis
May 12, 2010
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