SA faces two big property problems: Can one problem solve the other in the drive for affordable housing?

2022-06-15T06:49:00+00:00June 15th, 2022|News|

By Chris Campbell, CEO, Consulting Engineers South Africa

If you take a drive through South Africa’s metropolitan areas today, you might be startled by the sheer number of ‘To Let’ signs seen at office park entrances and multi-storey buildings.

Chris Campbell . Credit by: CESA

Chris Campbell . 📷 – CESA

Vacant offices seem to be a permanent consequence of the pandemic, with companies showing little enthusiasm for a full return to the traditional office working environment. This is of course understandable from a cost saving perspective; however, I would argue that the trade-off between reduced rental costs and employee wellbeing, employee productivity and the need for maintaining cohesive teams of employees, has not been measured sufficiently well enough to have the scales tilted in favour of mere cost saving through reduced office rental.

On the other hand, while offices stand vacant, there is a severe shortage of affordable housing – especially in areas with good economic activity. Never has the expression, “when life gives you lemons, learn to make lemonade” been more fitting of this situation. Why not make greater use of our excess of rentable office space, and convert it into housing? And I mean affordable housing, not penthouse luxury apartments (which seems to be the direction many property developers are going in). I quite understand the need to recoup costs for investing in such developments and the long-term investment value that would have driven the pursuit of such developments in the first place. What to do though when your office park is less than 50% occupied and could possibly remain that way for the foreseeable future.

South Africa doesn’t need more luxury apartments. We need to provide affordable housing that is accessible to many, that does not compromise on quality and location in respect of the proximity to the workplace as has been the legacy of residential development in the country. Let’s not confuse affordable with low cost, as the cost recovery dynamics will differ significantly. This differentiation is not new and is already catered for in many of the national residential policy provisions. Empty offices pose an excellent opportunity for dealing with our housing shortage, and I implore our government to consider this opportunity and take another look at the National Infrastructure Plan 2050, crafted before the Covid -19 pandemic, and factor in potential policy changes that could facilitate the repurposing of such vacant office complexes as a solution for the shortage in affordable housing.

Of course, things are not as simple as we would like them to be. Mixed income development has unfortunately always been met with much resistance. We are unfortunately still largely an unequal society and being ranked as a country with the highest Gini coefficient, globally, is certainly not something to be proud of. With an ailing economy and many years of waste, pillaging and lost opportunity behind us, hopefully that is, unfortunately though this reality is not going to change any time soon. It is going to take significant economic growth for this to happen. In seeking interim solutions to our shortage of housing though, we must consider that not every vacant office sits in the heart of Sandton City. There are properties from Kyalami to Edenvale, Muldersdrift to Alberton in Gauteng, that stand in prime locations for families in search of affordable, well-positioned homes. The same is true in many of our metropolitan areas across the Country.

And if we don’t take up this opportunity, what are the consequences? Well, we already know. One only needs to look at what became of the Joburg CBD with the urban decay that resulted from the long period of inaction following the mass migration of private sector companies from the CBD in the early to mid-90’s. Though much conversion has taken place to repurpose these, many such buildings remain empty and have become virtually irreparable. Whilst this phenomenon might not be as prevalent in other major city centres, it certainly is avoidable, if addressed proactively and early enough.

Indeed, we must learn from our past and respond quickly to South Africa’s changing landscape. Consulting Engineers South Africa – which is celebrating its 70 years of Partnering for Engineering Excellence this year – proudly has over 580 consulting engineering organisations as members, employing more than 17 000 people. I am confident that together we can offer the expertise to assist in the smooth transition of offices into housing. I invite government and private sector developers to call on us as a key player to the re-engineering efforts that would have to go into this process. The National Infrastructure Plan 2050 may not mention housing and all its challenges, but it certainly acknowledges the power of public-private partnerships in reaching our country’s goals.