Pictures: Jon Ivins
Work, life and play are becoming the buzzwords of property pundits predicting downtown Durban’s full potential will be realised.
Sershin Moodley, a former banker and now KZN regional manager at specialist property company, TUHF, has been heavily involved in the regeneration of Durban’s central business district. In 19 years, TUHF has played a key role in inner-city regeneration. He says that when eThekwini provides a better work-life balance for inner-city residents, the downtown property market will boom.
TUHF has a R3-billion loan book through its funding to 598 buildings, providing 34 000 residential units across South Africa. More than 80 of those buildings are in Durban, where TUHF is working with great appetite.
The bulk of TUHF’s funding goes to entrepreneurs who see merit in responsible developments that help turn run-down areas around. In addition, 10% of its funding goes to student accommodation.
We are impact funders. You can get finance from just about anyone to invest in property, but what we do is lend to people who want to change lives for the better, people who are passionate about making a difference and adding value to the community,” Moodley says.
“When we find that culture fit, we work with investors to support the development of their project and help them turn a profit.”
Moodley talks of “self-sustaining ecosystems” and the growing prospects for these in the neighbourhoods TUHF has invested in. The post Covid-19 era has created huge opportunities to repurpose commercial property into multi-use developments. A few trends could see a surge in property investment in the inner-city, he says.
“Firstly, micro-units are becoming more popular because people are downsizing as a direct result of the economic impact of the pandemic. Secondly, many are looking for more communal living areas with their families instead of commuting into the city. And finally, there is a short supply of quality student residential offerings in and around Durban. With the city becoming a hotspot for tertiary education, there will be a growing need to house the out-of-towners,” Moodley explains.
Durban’s CBD offers the chance to cater for these three markets especially if people see the benefits in living, working and playing in a central area with great amenities. Moodley says confidence will trump caution and attract more money into the inner-city if the municipality and other role players pull together to create an enabling environment for a breed of entrepreneurs who want to make money but also leave a legacy.
“We help entrepreneurs who invest in communities and buildings. We have systems and mentoring programmes that help them understand and manage their investments,” he says. He also says the city would do well to ruthlessly root out corruption, cut red tape and increase service levels. It seems to do this admirably in the holiday season when tourists flock to Durban, but why not afford city residents the same standards all year round?
“Good service should be the norm rather than seasonal. We need to take care of inner-city residents. The resources provided by the city need to be constantly improving, from lighting to water to roads to safety. And we need quality amenities like safe parks, and co-op areas,” he says.
“This attracts paying customers and aspirant people. It also sustains entrepreneurs who provide everything from accommodation with Wi-Fi to indoor pools to gyms and laundries. This creates a self-sustaining ecosystem.
“It is about applying the work, life, play concept and to be more inclusive to those who might traditionally have had difficulties in renting mixed-use properties with all-inclusive living. If the city wants to succeed it has to deal with bureaucracy and bottlenecks.”
Moodley says where some see the commercial property market in the CBD as “subdued”, TUHF sees the long-term prospects. Many large, listed organisations that own properties in the CBD are either looking to sell or transform their building stock into residential or mixed-use developments. The conversion of old office buildings into residential or mixed-use units is significant.
Moodley says big office buildings offer the prospects for scale. With regulation safety features and adequate plumbing, big office buildings can be easily converted into residential properties, which can offer the opportunity to cater for a broad range of customers.
He also says Durban has an incredible offering, a package of lifestyle and business opportunities. It is an important geographic hub for the country, especially in the post-Covid-19 environment where people will increasingly migrate to the coast to benefit from a more balanced lifestyle.
“In other coastal areas, the cost of living may not be as accessible while weather fluctuations are quite extreme. This compared to the affordability and year-long reliable climate of Durban. And when it comes to matching salary levels from other, traditionally wealthier parts of the country, Durban has grown in the past five years to come within 5% of what people earn in Johannesburg, for example,” he points out.
Moodley says companies in KZN are no longer afraid to pay for talent. Durban has already become one of the largest call centre hubs in the southern hemisphere. Furthermore, many specialist physicians are moving to Durban with other professionals choosing to commute to Johannesburg.
“It comes down to the quality of life and the opportunities provided through a more innovative mixed-use property environment. With the repo rate being the lowest since the system was introduced in 1998 and the ability to find the right project at the right price, KZN and Durban’s inner-city will start attracting significant investor interest in the coming months,” he says.