High Street Auction Co helps give new life to old buildings

Property conversions – office blocks to apartment blocks, retail centres to medical facilities or workshops into for-hire storage or warehouses – are the name of the property game of late.

“Not only does the auction platform unlock liquidity in the marketplace for private investors or state owned enterprises with large property portfolios that no longer match their future business strategies but it also provides an invaluable foundation for future development and re-development,” says  High Street Auction Co director, Greg Dart.  

Some of the almost 40 properties that will come under the High Street Auction Co hammer on July 17 could be ripe for re-invention, Dart believes. 

Repurpose rather than rebuild

Dart notes that the commercial property market is still oversupplied with market forces now driving the need for retrofitting office spaces.

“There is a need for capital allocation for asset repurposing. Converting underperforming office stock into alternative uses will ultimately remove obsolete inventory and tighten the market,” he observes. 

The consensus at High Street is that, in many instances, it is better to repurpose a building than build from scratch. Innovating so that existing buildings’ lives can be extended saves on costs, time and energy and contributes towards sustainability. Construction time can be reduced and challenges such as zoning and building restrictions diminished. 

Relooking at retail 

At present, both shoppers and investors favour convenience and neighbourhood retail centres anchored by grocery or pharmacy tenants for their stable footfall, essential service appeal, and resilience to economic volatility rather than large regional malls. 

However, according to Dart, it doesn’t stop there. 

Many retail brands and landlords are now adopting hybrid models, using physical stores as both showrooms and distribution points, enhancing their ability to meet the demands of consumers shopping online. Some properties are being converted or upgraded to cater for this as well as for other commercial tenants such as medical practitioners and professional services. 

Dart believes that the Sunward Palms in Sunward Park, Gauteng, where there is already provision for the inclusion of medical facilities and which will be auctioned on July 17, is an example.  

“This fully tenanted 6232m² property is ideally suited for a proposed medical day hospital development as it is perfectly positioned to complement the existing anchor tenant, Virgin Active,  plus nearby medical facilities including the Netcare Sunward Park Hospital,” he explains. 

Accommodating change 

Another segment of the commercial property space that is evolving is the hospitality sector. Its recovery is seeing the entrance of new operators who are converting older properties to better service new tourism requirements or even re-using these properties as medical facilities, retirement centres or residential estates. 

One such venue, known as Dozi's Back to the Roots Venue at Hartebeespoort in the North West province, will feature in the July 17 auction  as will properties in Dullstroom. These include the quaint Cpirit Market Place with its retail offering housed in repurposed black shipping containers, seven charming Cpirit Country Haven Self-Catering Cottages and the Cpirit Village View Guesthouse.  

Rethinking residential

However, the most talked about trend right now is the conversion of commercial properties into residential and student accommodation. Latest trends favour mixed-use developments that minimise travel costs and congestion. 

Dart attributes the rise in mixed-use developments to urban migration, lifestyle integration and a continued remote work culture. The growth of live-work-play precincts reflect both the diversification of income streams (residential, retail, office) and their strong appeal to tenants seeking lifestyle and flexibility.

He acknowledges that there is a compelling case for investment in commercial to residential conversions – especially those with an affordable housing component. In fact, many local governments are actively seeking opportunities to partner with developers to leverage inner-city residential projects to address growing social housing backlogs and urban decay in city centres.

An example of what can be achieved was a property in Salt River that was sold by High Street to big precinct developer Divercity for R30-million. This morphed into Divercity’s R280-million inaugural Cape Town development (known as 9 Hopkins) which broke ground last year and will bring around 400 affordable rental apartments to Salt River.

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