- Africrest Properties is near complete with their office to residential repurpose project in Sandton.
- The Apollo residential complex has replaced what was formally PwC corporate offices in Sunninghill, Sandton.
- The R400 million 200 apartment repurpose project will provide accommodation for 500 people.
- The recourse is as a result of the oversupply of offices space in and around Sandton post Covid.
Africrest leads the trend post covid by providing affordable rental accommodation in a traditionally upmarket area which allows a shorter work commute or work from home for tenants. “You are now seeing affordable home rental prices close to work. It’s opening up areas that were traditionally more affluent to a more middle-income market. I say affordable, relative to rentals in the area before,” said Greg Blend, one of the co-founders and a director at Africrest Properties.
Monthly rent for a studio apartment at The Apollo starts from R4 890. A one bedroom starts at R5990 while a two bedroom unit will cost R7550 per month in rent. The rent includes amenities such as uncapped Wi-Fi, free-to-use trainers at the in-house gym and shared work-from-home offices and business centres.
The Apollo is one of three office parks that Africrest is converting to residential apartments in Sunninghill. Its conversion of an adjacent office park, now called The Alpha, is already complete. The company has purchased another office property just down the road from those two and is planning to turn it into 320 apartments.
Collectively, Africrest has budgeted to spend R800 million on the Sunninghill conversions alone, adding 1 250 residential units, some of which are priced relatively lower than the standard set by landlords in areas surrounding Sandton.
Diversity in value-add key to success in over supply in rental market
Africrest remains upbeat as the Sandton area amid amassive over-supply of rental stock in the Sandton area. Many other property developers are doing the same thing. It has managed to fill all the 200 apartments at The Apollo, whose conversions is now complete.
Because of the low vacancy rate, the group plans to do more conversions around Johannesburg. Blend said there’s potentially another 1 000 units in the pipeline for Ferndale, Randburg. The company already has two converted properties there.
“The whole South African rental market has been terrible at the moment in terms of vacancies. But build-to-rent landlords like us actually aren’t doing that bad at all because people looking to move will come to us over an individual landlord,” said Blend.
Africrest has the edge over older apartments because of their more modern finishes and amenities.
The Apollo, for instance, has an endless list of amenities such as a concierge, rooftop party areas, Zoom pods, a yoga studio, a cafe and boardrooms over and above the usual facilities found at surrounding buildings.
Author: Bryan Groenendaal