Neighbourhood 28 NOVEMBER 2021
PROPERTY & LIFESTYLE
It’s business
unusual
Along with other African cities, Nairobi in Kenya’s office sector is hard hit by the effects of the pandemic. We unpack the continent’s current commercial property values, page 2
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PROPERTY TRENDS
28 NOVEMBER 2021
Adapt or die Lagos, Nigeria
The onset of Covid-19 not only affected people and communities, it also impacted commercial property values across the world. Roger Long, director: valuation and advisory services, Broll Property Group, sheds light on the pandemic’s effect on property in Africa and how some solutions are starting to emerge
T
he outlook for each country’s market at any given time, is largely tied to the expectations on the performance of the wider economy in that country, and it’s expected these trends will persist in the short to medium term. In terms of the pandemic, it was initially anticipated the hardest hit property sector would be retail due to the lockdowns and subsequent inability to trade. However, many malls and most of the smaller centres have, in fact, fared relatively well during the last 14 months or so. This
may be attributed to landlords acting swiftly with rent reductions, deferments, etc. resulting in many retailers managing to stay afloat, thereby preserving the rental income of the asset.
Office vacancies
Instead, the office sector has been the hardest-hit asset class in South Africa, and the pressures are not expected to ease in the coming months. The fallout in the office market has seen property and rental values recede sharply. In the early stages of the pandemic, a number of occupiers
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held firm and retained space during the lockdowns. Landlords were therefore still receiving the majority of their income even from empty buildings, but vacancies are now rising as occupiers decide they no longer need as much space. The South African Property Owners Association (SAPOA) reported that Q3 2020 vacancies reached an all-time high of 15,4%, while the pre-Covid-19 level was 11,6%. Additional supply is also coming to market as a result of projects that were planned and started well before the pandemic. At the start of 2020, about 263,000m² was in the pipeline, which slowed to around 47,000 m² by Q3 2021. Offices in smaller outlying towns are not as badly affected due to a more limited offering.
Faring well
Prime logistics facilities are doing well, not only in South Africa, but across the continent. Furthermore, the growth in online retail has seen a corresponding rise in interest in data centres as companies move to exploit opportunities in the online sector. A number of data centre companies are expanding in strategic locations across West, East and South Africa.
Offices reinvented
Atlantic Seaboard, Cape Town
PUBLISHED BY TIMES MEDIA PROPERTY PUBLISHING
In general, occupiers are seeking maximum flexibility, considering that their demand for space in the short and medium term is still relatively unknown or unconfirmed. Occupants want the flexibility to either work from home or to do so on a rotational basis. This would most likely be a long-term trend post the vaccination rollout.
Occupiers are increasingly focused on understanding what the future workplace will look like and how it affects their existing real estate structure. More corporates in this market are looking to not only optimise operational functions in terms of cost, but also in terms of the size of their requirements. Landlords, on the other hand, are seeking strategies to drive occupancy of their buildings. These range from more flexible lease terms and notable rental discounts (on a case-by-case basis) to looking at less traditional uses for their buildings. For example, the co-working model. Furthermore, landlords are looking at repurposing surplus or vacant space.
Multinationals in the driving seat
A number of local players and parastatals are shifting towards better quality spaces, therefore competing head-on with multinationals. This trend will continue as the benefits of modern space are being discovered by tenants who have not traditionally occupied such space. In the A-grade market segment and, to a certain degree, B-grade, it’s predominantly the multinational corporates driving market activity. The fundamentals of this market, dollar rentals to be exact, tend to be financially unfeasible for local and some international corporates that earn revenues in local currency.
South Africa
It appears that property and rental values in the rest of Africa have not been as badly affected
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28 NOVEMBER 2021
by the pandemic as in the case of South Africa, especially the office sector. It’s expected that a rebound to pre-Covid-19 levels could take until 2022 or beyond. One exception to the trend is industrial real estate, specifically warehouses and logistics centres, which have gained value as investors snapped up buildings essential to the delivery economy. Covid-19 has upset real estate fundamentals by changing how we lead our lives. Companies are already deciding they will need less office space than before, either because of staff cutbacks or because employees will permanently or partially work from home. And the rise of e-commerce – along with small business closures – will create a glut of retail space in a country that already had too much of it.
Nigeria
The impact of Covid-19 on the office market has manifested in a number of space and cost consolidation strategies as a result of the health, economic and business impact on company revenues and general operations. Transactions are at a record low, with the lowest take-up in five years recorded in the first half of 2021 at under 200m². Vacancy levels remain high, with an average of 46% as opposed to the pre-pandemic level of 39%.
cused ture ow tate this y s in ms of
The residential sector, on the other hand, has witnessed some noteworthy transactional activity in the last six to 18 months. Driven by the necessity to store and create value in a challenging business environment, especially with less than desirable yields in safe haven assets in the country, a number of investors have flocked to the residential market.
e
There has been a great degree of investment in the luxury and middle-income segments, while affordable housing, which has the ional highest supply gaps, is yet to see this quantum of investment. el.
le l
Mauritius
At the beginning of 2020, valuers in Mauritius had a cautionary outlook for the property market, predicting the industry would see similar trends to those witnessed in 2019. Rising average vacancy rates and downward pressure on rental growth, affected by the already low consumer confidence level and major disruptions to the economy, impacted property values further. However, no one could have foreseen the impact the pandemic would have on this already strained market, with international border closures in particular stifling the key tourism sector for many months.
Kenya
In Kenya, the office sector recorded a year-on-year (YoY) marginal improvement of 0,7% in occupancy levels and a corresponding 1,6% YoY decline in rental rates as landlords offer increasing incentives and discounts to fill space. The retail sector achieved an improvement in occupancy levels of 2,7% YoY, while rental rates declined by 3,1% YoY as landlords continue to also offer concessions in this sector.
Johannesburg
The asset class that has remained somewhat buoyant is the logistics sector. There has been increased interest for short-term storage, especially for medical facilities and goods.
Ghana
Although the evidence is not yet fully reflected in the market, there are sentiments that a number of commercial property tenants could downsize their space requirements due to new remote working practices. Leases coming up for renewal and rent reviews are likely to be agreed to the advantage of tenants. This is due to the increasing vacancy rates resulting from the banking sector reform of 2018 and large corporates opting for owner‑occupied developments.
Accra, Ghana
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Nairobi, Kenya
Mauritius
PROPERTY TRENDS
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ADVICE
28 NOVEMBER 2021
No, it’s not
covered
All too often consumers assume their insurance policy is a maintenance contract, but this is one of the biggest reasons for claims being rejected by insurers WORDS: SUPPLIED PHOTOS: SOURCED & SHUTTERSTOCK
H
omeowners who neglect to maintain their homes are often in for nasty surprises at claims stage, says Old Mutual Insure spokesperson, Lizo Mnguni. “If you have not maintained your home properly and this leads to more serious damage, then it’s very likely that your insurer won’t pay out,” says Mnguni.
“This often happens when people don’t understand what they are buying, and mistakenly expect their insurance policy to cover everything.” The purpose of your insurance policy is to ensure that you are covered against unforeseen events, which excludes normal wear and tear. “An example of someone treating their policy like a maintenance contract is if they have not cleaned out their gutters ahead of the rainy season and it causes a pool of water to start seeping into the ceiling, which in turn causes it to rot and mould to develop. This would not be an insured event.”
Understand your policy
Old Mutual Insure rejects many claims that are maintenance related, which highlights the extent of the problem. “To avoid the likelihood of this happening, you must make sure you understand your insurance
contract as well as its exclusions and speak to your broker to get clarity. Your broker can also guide you on what is a legitimate claim, and what would likely be rejected.” If you notice deterioration in and around your home (e.g. a damp patch, a pipe dripping) and you are worried you’ll need to make an insurance claim, tell your broker as soon as possible, who can advise further.
Keep it up
Mnguni says homeowners are required to perform proactive risk management by maintaining their homes, which if done diligently, can lead to a reduced premium in the future. “Part of this includes making sure you have adequate cover in place should something unforeseen happen. But also remember you have a duty of care to ensure even though you are insured, you are not taking huge risks with your property.”
He reminds policyholders that when buying a new home, they must, in the excitement of the purchase, not forget to account for the financial costs of its upkeep.
BE PROACTIVE
“The financial implications of discovering you are not covered for an event due to not taking proper care of your home, can be far more costly than committing to a diligent maintenance programme of your home,” says Mnguni.
Mnguni shares the following tips to keep your home maintenance up to date. • Check exterior painting for peeling and cracking, which may result from potential water leaks or moisture problems. Repairing mortar walls and chimneys becomes necessary if: - Mortar is missing or cracked - Bricks or stones are loose - Walls are damp or plaster work is damaged • Perform seasonal maintenance e.g. ahead of the rainy or thunderstorm season. Clean your gutters, air conditioning units and trim your trees and shrubs. Also clean your chimneys and inspect the structure for leaks. • Consider getting licensed maintenance contractors (plumbers, electricians and other tradesmen) to inspect your property, including hard to see places like roofs for debris or obstructions. Inspect your geyser – it may be time to replace it to prevent the damage from a burst one. • Ensure proper ventilation in places that you don’t often go in your home (e.g. in your ceiling) to prevent excess moisture from creating damp. • Service your alarm system and ensure that your home safety devices are in working condition (e.g. electric fences and gate motors). This is especially important before going on holiday.
Another tip he gives policyholders is to always keep proof of all of maintenance work – e.g. alarm repairs and servicing, “which can really help you out at claim stage.” He explains in the case of a legitimate claim, where a historic home has experienced a burst water pipe or cracked roof tiles due to storm damage (for example), it can sometimes get more complicated, given that it is difficult to replace items like tiles or carpets if they have been discontinued, and some insurers may pay you either for its replacement value, or as new (but with depreciation accounted for). “The point of insurance is to put you back in the same position before the loss occurred, so in these cases your insurer will pay you the replacement value in cash if they cannot replace an item due to it no longer being available.” He adds that if you specify a very special “irreplaceable” item, your home contents policy should cover it on a global basis. Meaning that if you experience a loss, and the value of the item is below the total of your home contents policy, it is covered; but if it is above the sum total, then your insurer will most likely only pay a portion of your claim.
SCAN ME
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AGENTS MOVE TRANSACTIONS FORWARD
No home is a perfect fit – not for the seller, not for the buyer. Registered estate agents know how to overcome objections on price, date of occupation, and all the nitty-gritty elements that make up a property transaction. Registered estate agents have the experience to move the transaction forward.
Another good reason why you should use an estate agent
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Neighbourhood
yourneighbourhood.co.za | 28 NOVEMBER 2021
Properties & Virtual Tours
Web Ref: 5030355
Web Ref: 4971336
Saxonwold - On Show Sun 2-5pm. Stunning Triple-volume Masterpiece. This 6-bedroom north-fac-
Saxonwold - On Show Sun 3-5pm. A lock-up & P ark v iew go with a Saxonwold address. Unique, one & only!
ing, architecturally-styled home is a sheer delight. The sense of spaciousness and attention to every detail is unparalleled. Styled on a French barn, with exposed rafters and wraparound first-floor gallery, highly-polished floors unify the completely open-plan living spaces. The chef’s kitchen, with private courtyard, ensures that the family that plays together, stays together. The six bedrooms include a downstairs guest suite. A steal at R9.5m. Kim: 082 551-5486
Web Ref: 4985075
42 Kilkenny Road
14a Avonwold
Web Ref: 5037497
Web Ref: 4841036
3 Dee Road
Web Ref: 4796088
5 Hampshire Mews
M o r n i n g s i d e M a n o r - O n S h o w S u n 2- 5 pm K i l l a r n e y - O n S h o w S u n d a y 2- 4p m . R e d u c e d
Tamarisk
S t r a t h a v o n - O n Sh o w Su n d a y 2 -4 p m . N o w o f f er s fr o m R 2 . 2 5 0 m . A G r ea t D ea l ! Townhome offering 2/3 o/plan living spaces, mod o/plan kitchen. Spaces merge creating a fantastic entertaining area onto a patio & private garden. 3 Magnificent beds with the main e/s, o/plan bath, private shower & beautiful cabinetry. 2nd Bath services the 2 remaining beds. Best of the best. D/garage, staff acc, guest cloakroom. A truly perfect lock-up-and go. Marc 082 854 7272 Stan 082 558 9258 Dir: Tamarisk, 179 Linden Rd.
12A Epping Road
- Of fe r s f r o m R 7 m . On S h o w
Web Ref: 5026418
Web Ref: 4935473
Web Ref: 4897340
F o r e s t T ow n
of the Ridge. Open log fireplaces - n/facing lounge, country kitchen. N/facing MES, 2 further beds with shower, 2nd bed with loft. Entertaining areas to patios with tall trees and lush garden. Glimpses of views from beds with balconies. Spacious self contained cottage, bed, kitchenette, fireplace, lounge / dining & shower room. Studio / office. Staff acc. Garaging, off rd parking. Asking R7.5m. Call Beverley 082 412 0010
On Show Sunday 3-5pm. House plus 2 stunning separate units letting at ±R17 500pm. 1935 home meets 2021 with stunning double glazed glass extensions creating open plan living for today's family life style. Entrance hall leads into the reception spaces of family living encompassing the o/plan kitchen and dining room, all opening onto a patio. 2/3 beds upstairs with 2 baths. Separate 1 bed self contained cottage plus ±100m² studio. See website for more info. Asking R4.85m. Theodora 082 553 8525
O f f e r s f r o m R 3 .7 m . E x c l u s i v e u p m a rk e t s t re e t
Web Ref: 4967617
In perfect alignment with the 589m² site, this home was carefully designed for modern-day living. Water features, Gazebo for al fresco dining, features: draping with modern hanging bare bulb lights, creates a unique feature with smooth transition between indoor & outdoor. Small footprint with open design, 3 living areas, kitchen plus WFH/ study area. 3 Beds e/s, or his & hers baths, balconies, light, bright & sophisticated. Asking R5.5m. Elsabe 082 414 6655
R4,750m. In prime position. A sunny n/facing garden welcomes you. O/plan living in this fam/home from kitchen to patio encompassing lounge, fam/room & din/room for all year entertainment + a private children’s playroom or games room + a private study/office opening onto the courtyard with it’s own entr. From the children’s playroom, stairs lead up to a pvt large wing/4th bed with e/s shower, bed & sitting room area opening onto a balcony. Further 3 beds with 2 baths mes + a walk-in storeroom. Theodora 082 553 8525
Enjoy the best of indoor/outdoor living, contemporary character home. Expansive receps with wood burning fireplaces all with stacking doors to d/patio & pool. 3 Upstairs beds, 2 baths mes downstairs guest suite + study e/s (5th bed), farm-style kitchen, gas stove, plenty storage, fitted bar, staff acc, 3 gar + 2 carports, irrigation system, Quiet cul-de-sac. Excellent security. Asking R3.9m neg. Alan 082 490 0940. Dir: N Rivonia Rd R Alon R East L Murray
39 Westcliff Drive
Properties on Show
- On Show Sun 3-5pm. Comfortable family living pervades in this o/plan home. Kitchen, lounge, din/room & fam/room opening to a large cov stoep with pizza oven for all year entertaining overlooking an established garden & pool. The study can be closed off as WFH as it has its own entr. 3 Well sized bedrs all with built in cupboards, 3 bathrs, 2 e/s makes it “OH So Family”. Outside guest cottage for added income with pvt entr from the service lane. D/gar + 2 extra parkings. Asking R3.950m. See web for the full advert. In att: Theodora 082 553 8525
Parkview - On Show Sunday 3-5pm. Reduced to Parkview / Greenside East - Taking offers.
16 Gary Avenue
Web Ref: 4894824
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t o R 3, 8 m . T o w n - h o u s e l i v i n g w i t h l o w l e v y o n l y R 1 8 0 0 . R e n o v a t e d g a rd e n u n i t
29 Riesling Crescent
Su n 2- 5p m. Architect designed home. On the Breast
16 Talton Road
Hurlingham M anor - Contemporary package F or est To wn - Offers from R4.7m. On Show d esigned to steal th e show. On Show Sun 2 -4 pm
S u n d a y 2 - 5 p m . Ex c e l l e n t c o n d i t i o n + C o t t a g e s . NB 6 ho u r b a t t er y i nv er t e r u s a g e p l u s g a s .
Entr with vistas thru’ to the house, lounge with fitted wall unit & stacking doors, fam/room with feature wood burning fireplace & stacking doors, o/plan din/room with access to Caesar clad kitchen, scullery, 4 beds, 3 baths (2 e/s), guest toilet, staff/guest suite/Air BnB, d/garaging & tandem auto carport, cov patio with built in braai overlooking pool & captivating firepit. Walk to St Stithians. Asking R3.9m. Karen 083 435 7703 John 083 271 0231Dir: W Nicol into Republic, R Woodlands, 3rd R Riesling
Spacious family home, renovated by Architect Mark Hanson. Stunning elevated patio, sparkling pool & al fresco dining with Fire pit. High ceilings, bay windows and wood floors. 3 D/beds all e/s. Plus 2 bed cottage or 2 one bed cottages both with living areas, shower rooms, sep entr. with parkings. D/garages. Asking R4.950m. Call Beverley 082 412 0010
Web Ref: 5041023
Web Ref: 4993197
2 Sandhurst Place
S a n dh u r s t
- L o f t y v o l u m e s f l o o d e d b y e ff e r ve sc en t l ight . On Show Su nd a y 2 -4 pm . An urban
60a Talisman Avenue
Bed f o rd v iew - Modern ope n-plan l ivin g at i ts b e s t pl u s f u l l c o t t a g e . O n S h o w S u n da y 2 - 5p m
3 Bed, 2 Bath, spacious townhouse in Hampshire Mews, downstairs open plan living, with solid wood kitchen, Siemens appliance etc. Upstairs 3 bedrooms all with bics, main bedroom en-suite. Garaging plus staff rooms. In att: Ashika 063 232 0892. Dir: Follow boards heading north from Oxford Rd, turn right into Riviera, turn right into 4th, follow boards to unit
space that has been artistically remodeled by the creative owners. 4 O/plan receps with fitted bar which flow to the resort-style terrace, plus pyjama lounge on 1st floor leading out to extended balcony with Jacuzzi, 4 beds, 3 baths (2 e/s), guest toilet, feature pool, fabulous o/plan kitchen, separate scullery, d/garages, staff suite. Asking R8m. In att: Karen 083 435 7703 John 083 271 0231 Dir: Rivonia Rd into Eton Rd at Shell garage.
Impeccable, pristine and perfect. Sumptuous reception spaces, onto stunning modern “Blu-line” kitchen, complete with state of the art “Smeg” integrated appliances. Seamless flow from lounges and dining area to a beautiful entertainment setting. 4 Bedrooms, full cottage, 2 garages, boomed off street. Asking R7.9m. In att: Ingrid 082 490 6246.
Web Ref: 5035394
Web Ref: 4881344
Web Ref: 4756165
26 Gatwick
H y d e P a r k - 5 Ap a r t m e n t s f o r s a l e i n A i r p o r t Bu ild in gs op p Hyd e P ar k s hop p ing ce nt re . O n Sh ow Sun da y 3- 5p m. Renovated 2 bed, 2 bath apt (126sqm). Asking R2,4m. Also to view: 2 Bed, 2 bath garden (116sqm). Asking R2,49m. • Renovated 2 Bed, 2 bath (139sqm). Asking R3,1m. • Renovated 3 Bed, 2 bath (172sqm). Asking R2,85m. In att: Di Kuhlenthal 082 960 5353 Debbie Parkinson 083 326 7739. Dir: From Jan Smuts & 2nd Ave follow pointers
S25 Heathrow
H yde Park - Re novated elegant 1 bedroom, 1 b athr oom ap artmen t (8 5sqm) in the Airp ort b uildings ac ross the road from Hyde Pa rk shop ping ce ntre. Ask ing R1 .7 5m. On Show Sun 3-5pm. Also to view: 2 Bed, 2 bath, garden apartment (116sqm) Asking R2,49m; Renovated 2 bed, 2 bath (139sqm) Asking R3,1m; Renovated 3 bed, 2 bath (172sqm) Asking R2,85m. In att: Di Kuhlenthal 082 960 5353: Debbie Parkinson 083 326 7739. Dir: From Jan Smuts and 2nd Avenue follow pointers
Emerald Woods
I l l o v o - O n S h o w b y a pp o i n t m e n t S u n 2- 5 p m c a l l J e n n y 0 7 2 2 6 3 4 80 1 t o v i e w . N e v e r b e e n s ee n b ef ore ! Of f er s f rom R2. 8 m. Sweeping views. A sprawling chef’s kitchen, a unique home boasting large built in book shelf and amazing fire place. 4 Generous bedrs, lounge with floor to ceiling windows, din/room, coupled with original High Ceilings & sliding doors all leading to a patio the size of a private garden, pool. For those wanting to live at the door step of convenience. Asking R2.899m.
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