Weekend Argus (Saturday Edition)
Elsies River’s industrial area on the up
Property in demand thanks to implementation of the new City Improvement District
ELSIES River’s industrial node has experienced a significant increase in demand for property, which to a large degree is attributable to the rejuvenation of the area through the recently implemented CID (City Improvement District), says Drew van Heerden, property broker for Annenberg Property Group.
“With 24-hour security patrols, crime rates have dropped, roads have been repaired– including the potholes– and the area is clean and appealing.
“This area has experienced a complete turnaround, which has resulted in a growing number of inquiries from businesses wanting to move into the area and a number of concluded sales. These include a 1 800m² building and a 1 842m² yard, which was sold to local investors for R4.5 million, and a building of 1 990m² which was sold for R4.565m to an owner occupier, who has relocated from one of the surrounding areas.”
Set in a quiet cul-de-sac, the first property, which houses three strong tenants – a transport and storage company, a powder coating operation and a panel beater – achieved an excellent yield of 9.5 percent.
Says van Heerden: “The buyers were looking for an investment that met a number of criteria.
“In addition to a property that would provide good returns and offered underlying value in an upcoming area, they wanted premises they could occupy in the future, as their current business grows, and a location with accessible public transport.
“In addition, this property has a large, secure yard which is rare in the area, and has the potential for expansion. Traffic in the area is relatively light, which allows for easy deliveries and dispatches, while it is close to several public transport options.
“With the 3 642m² erf, the new owners also have the option of relocating their business to the premises when their operation needs to grow.”
The other recent sale was on behalf of Window Door Store Cape, which wanted a centrally located property as a distribution point and in a secure area with a CID, with good work flow for their operation and enough electricity supply for their machinery and for future growth.
Manufacturers of wooden windows, doors and blinds, they have refitted the building for their needs.
“Situated on a 2 854m² erf, the property borders the road on three sides, providing good exposure for passing traffic.
“It also has the benefit of access to the premises from several points, which allows easy entry and exit during receiving and dispatch, and the property is close to various modes of public transport.”
He says properties in the 1 000 to 2 000m² size range are sought after among owner-occupiers who are looking for value and want to be centrally located. These include vari- ous light manufacturing industries, as well as transport operations.
“In general, properties move fairly quickly and there have not been many long-term vacancies. All the positive changes achieved by the CID are paying dividends and the area is now perceived as providing a well-timed opportunity to acquire property with the potential for sound growth and income returns.
“Property prices and rentals in the area are on the increase but good value is still to be found in Elsies River Industrial. This is also home to one of Growthpoint’s prime industrial business parks, Central Park, which is tenanted by some large national users. This industrial park rarely has vacancies and achieves above-market rentals compared to surrounding areas.”
John Houston, local business owner of Makeshift 1104 and part owner of Emplast, took on the responsibility of setting up the CID and the Geocentric cleaning team was appointed to keep the area clean.
“Geocentric is like a giant vacuum cleaner that appears to have mountains of energy keeping the area neat and tidy,” says Houston.
“It has been exhilarating to see the continual daily improvement and transformation and we now have a sound, safe and secure area. To achieve this we have a dedicated manager for the area, as well as foot and vehicular patrols performing public safety duties, and an urban cleaning and maintenance team that immediately tackled the illegal dumping and littering and started repairing some of the municipal infrastructure.
“Eight CCTV cameras have been fitted in strategic locations and are monitored around the clock by a control room.
“We established good working relationships with officials in the City of Cape Town and they also started to bring more resources to the area to address broken and degraded infrastructure.”