Student Accommodation & Social Housing

Building conversions that add value

Across South Africa, there’s a growing need for student accommodation, and the same holds true for affordable and social housing. Closing the gap requires an innovative approach, which should include building reuse alongside greenfield developments, says Sean Kenealy, director and professional architect at STAG African, a specialist property developer. By Alastair Currie

Opened in March 2021, STAG African’s new student residence in Gqeberha (formerly Port Elizabeth) is a prime example of how a developer can repurpose and add value to an existing building. In this case, the former Summerstrand Hotel has been converted into an accredited 500-bed residence for students attending the nearby Nelson Mandela University (NMU). The focus is on providing safe and affordable accommodation, particularly for those receiving financial aid. Amenities include self-catering communal cooking facilities for up to 80 students, catered meals, laundry facilities, Wi-Fi, a swimming pool, and numerous communal areas. Each of the existing 245 hotel rooms has been converted to a double-occupancy bedroom with en-suite bathroom. Meeting the need for university-accredited offsite accommodation is a key priority for NMU. Currently, there are 3 299 beds in universityowned residences; however, NMU currently has around 29 000 students, which means that only around 12% of the total population can be accommodated on campus.

STAG African has a 50% shareholding in the property, now known as the Summerstrand Student Village, which was purchased on auction at the beginning of 2020. Building renovations began in August 2020 and the project was fast-tracked for completion ahead of the 2021 university year.

Sean Kenealy, director and professional architect at STAG African STAG African’s recently completed 2 047-bed student village for the University of Fort Hare

Plan for future running costs

“The secret to successful building conversions is based on factors like research, and minimising the number of interventions

required. It’s also fundamentally important for any property development that you determine the future running costs up front,” says Kenealy.

Generally, older buildings tend to be more expensive to run. This strongly influences their viability from a retrofitting perspective in key areas like electrical installations, water and sanitation, drainage, fire code compliance, and health and safety.

“Compared to commercial office-toapartment conversions, a hotel is a lot easier since the buildings are already configured for residential occupation. As with any conversion project, however, some financial contingencies will need to be made for unexpected costs. Keeping them to a minimum depends on expert experience, without compromising on quality,” Kenealy continues.

At Summerstrand, the largest renovation costs were the upgraded services, as well as the new furnishings and carpets for the bedrooms. Face-bricked areas were also painted to enhance aesthetics.

To further improve the sustainability of the building, energy-efficiency interventions include the retrofitting of a new heat pump and hot water storage system. This replaced the older hot water boilers, which were far more costly to run. Where practical, internal and external lights have been replaced with LED fittings.

“Going forward, we will continue to refine the overall facility to improve efficiencies even further. Examples include the possibility of solar installations and greywater reuse, which are common features on our other student developments,” Kenealy explains.

Inner city projects

Alongside its greenfield accommodation developments, like the recently completed 2 047-bed student village for the University of Fort Hare, STAG African has been responsible for various inner-city office block conversions. “There’s huge potential to convert derelict buildings into social housing units; however, each one must be judged on its merits. In other words, it would be a misconception to assume that – just because it’s an existing structure – it can or should be preserved,” Kenealy explains.

One of STAG African’s first office conversions was a 15-storey building in Braamfontein, Johannesburg, which was completed around 2005. The first 14 storeys were remodelled into 140 sectional title dwelling units, most of which are under 40 m2. On the 15th floor, the original double-volume plant room was reconfigured into six penthouse apartments. The three existing lifts were also replaced.

“An important lesson this project taught us was to find the right investment balance,” says Kenealy. “Adding the penthouses was a great idea, but it ended up increasing the original budget by around 25%.”

Deep space

The best candidates for office-to-residential conversions are those that can achieve the highest ratio of usable space. “We avoid older and wider buildings (20 m or more) that have what we refer to as ‘deep space’ characteristics,” says Kenealy. “In other words, the distance from the external windows to the central parts of the building or lift cores is too great,” he clarifies.

“Ideal buildings are those with a total width of between 12.5 m and 15.5 m. A narrower building allows you to retrofit a central passage, with apartments on either side. The upside is that there are plenty of buildings like these in all South African cities that are well suited to social housing,” he continues.

However, as Kenealy point out, the starting point is to ensure that any conversion is financially sustainable and fit for purpose in terms of future occupation, which – for residential projects – influences upfront costs like additional plumbing and drainage. In most cases, the extensive use of more expensive drywall construction is required when converting buildings, as the floors cannot support additional brick and mortar loads.

“One way to reduce overall conversion costs is to redesign internal sections of these buildings into communally shared spaces, like recreational rooms and central kitchens. This ‘co-living’ model is a growing trend in major cities internationally and could well become popular in South Africa, especially among younger people,” he suggests.

The Summerstrand Hotel in Gqeberha has been converted into accredited accommodation for Nelson Mandela University students A view inside one of the student rooms at Summerstrand

Public sector incentives

For developers to invest in urban renewal projects, he says there needs to be a holistic master plan, which is driven and supported by city planners. Catalytic property projects spearheaded by metros are a prime example.

“You cannot invest in isolation and then have your property value diminished by ongoing and surrounding urban decay. Government needs to drive the process and create an enabling environment where decaying city sections are reclaimed block by block,” he points out.

South Africa’s Infrastructure Fund makes provision for shovel-ready projects aimed at alleviating the massive shortage in student accommodation and social housing – the latter exacerbated by intensive urban migration.

However, mobilising these projects is increasingly interdependent on blended financial arrangements between the public and private sector. The major weighting is towards the latter in terms of the monies invested. An incentive to achieving this would be for government to provide meaningful subsidies and/or some form of rental guarantee to property developers.

“The quid pro quo for metros and municipalities is that these dormant buildings start generating revenue streams again in terms of rates and taxes, which then help to speed up urban renewal programmes,” Kenealy concludes.