Weekend Argus (Saturday Edition)
‘Apodment’ living – city’s next big trend?
Internationally, millennials are rushing to buy or rent 21m² flats just to be near vibrant areas
IS MIDDLE- class South Africa ready for micro apartments?
Property developers AJ Property Holdings and the Power Group think they are. And following SDP approval, which is expected shortly, they will launch high-end microflats on to the property scene with units starting in size at 21m² and going up to 48m².
Their charm? They’re decked out in space-savvy products, are in Woodstock just five minutes from the CBD, and start in price at well under R1 million.
Retail space downstairs promises to offer residents meeting and eating spots, laundromats, a pharmacy, braai areas, entertainment and, well, anything that you can’t fit into such a small space.
Middle-class South Africans – particularly those living in Cape Town – have been getting used to smaller spaces, and are willing to forego some room for the convenience of living in the region.
Semigrants from Gauteng – who have been a major part of making this market more buoyant than others – know they will have to downsize when they move here because the bang for their buck is way lower in the area.
Cape Town is also one of the toughest provinces for first-time home buyers – lagging far behind Gauteng which leads the pack with affordable homes. It is almost impossible for youngsters to get a foot in the door, especially close to the CBD, with only about 13% of all buyers here being first-timers.
FNB economist John Loos says the Western Cape’s strong housing market run has meant that aspirant young buyers have major affordability challenges.
“It is becoming more difficult for the average Capetonian to get into the market,” says Rob Steffanutto, group managing director at Dogon Property Group, who will market the micro-units.
“You can have an average job and just not afford to live close to the city.”
In fact, properties for R1m or under are non-existent in the CBD and surrounds. Estate agents say they haven’t sold anything for that amount in these areas for almost a year.
With affordability and space being such an issue, Steffanutto believes developers will need to start moving away from dated notions of what they think people need, and look at alternatives such as microunits for single-person households.
These super snug, compact and “affordable” flats – by city standards – could be a solution to the growing demand by the millennial generation to be closer to the CBD and their jobs, says Steffanutto.
In fact, international trends in big cities, where affordability and housing shortages are an issue, show millennials are willing to trade space for a vibrant, convenient location and the ability to live on their own. They see a flat as less a place to linger and more of somewhere to bed down.
Micro apartments, at just 21m², seem ideal for property entrants who live alone and haven’t yet accumulated many possessions; who can afford the bond; and who spend most of their time at work or socialising out of their apartment, says Grant Gillis, chief executive of Delta International Design Company, the interior designer and planner of the micro units. (See side bar.)
“What we are selling isn’t just an apartment but a lifestyle. To work, these buildings have to be alive.
“We need people living in the units, forming a community within the building,” says Gillis.
This in part is why developers are not seeking investors to buy units but instead they want to sell directly to people who will live in the units.
“Micro-units work because the demographic that chooses to live in such a place uses the community spaces within the building and the city itself as their living room,” says Steffanutto.
“How often do people really use a dining room or even a second room? When one looks at retail spaces these days their designs look like living rooms with couches and spaces to chill. They are offering alternate spaces for people to relax away from the home because this is where the market is moving.”
Neil Gardner, development co-ordinator for the project and Gardner Property Solutions chief executive, predicts that “in the future microunits will be one of the only ways youngsters will get a foot on the property ladder in a city like Cape Town”.
“It is not for every city, but it will work in Cape Town.”
Gardner has been known for spotting a trend before it becomes a trend. He was involved in the conversion of the Old Mutual building in the CBD into residential apartments (Mutual Heights) at a time when living in the city centre was not all the rage.
“I predict what happened in the city with office conversions will happen with micro units. I feel we will be rolling back the clock to the time when we did the first Old Mutual apartments when people were still sceptical of buying in town. But those who took the opportunity are greatly benefiting today.”
Gardner specialises in the Urban Development Zone areas of Cape Town, which the new development falls under.
Louis Karol Architects, who were involved in the Mutual Heights project, are the design architects for this project too, and lead the professional team.
Internationally, cities which are short of housing, such as San Francisco, Los Angeles, New York and Seattle in the US, and Melbourne and Sydney in Australia, are rushing to build amenities-rich microunits to give millennial workers the option of living in an area they could otherwise not afford.
Many overseas complexes housing these micro-apartments boast impressive communal spaces that include rooftop gardens, pools, fitness centres and lounges.
Micro-units work because the demographic that chooses to live in a micro-unit uses the community spaces within the building and the city itself as their living room, agrees Albert Lourens, managing director of AJ Property Holdings.
Another use for micro-units is for them to be “crash pads” for people who have bigger homes out of town and need to come to town a few days a week for work.
Not every micro-unit will be sold with parking. “Many young-
These super-snug close to their jobs
sters, and even those who are older, are ditching private transport in exchange for minibus taxis, buses, bicycles, taxis and uber, and even their own two feet.
“It was important for us to find a piece of land that was on major transit routes, and we have done this,” says Lourens.
But will buyers make a profit when they eventually sell their micro-units? Are micro-units a huge untapped market or a niche trend? These are questions that will still need to be answered in the South African middle-class context.
But, if international trends are anything to go by, the answer is yes.
A 2014 study in the US, by Urban Land Institute’s Multifamily Housing Councils division, evaluating market performance and market acceptance of micro- housing, showed that newly built micro-housing had higher occupancy rates and achieved higher effective rents for new leases.