The micro-living trend has arrived in South Africa and is making it possible for easy access to property investing in a niche investment sector that is set to explode in SA as an alternative residential asset with higher yields than other property classes.

This is according to Alexa Horne, MD of Dogon Group Properties (DG), who says that DG have been seeing high demand for micro-living apartments.

Horne unpacks the top five reasons why people are investing in micro-living apartments:

  1. DEMAND IS HIGH

“The world is abuzz with change, and new lifestyles are being embraced.  Millennials are looking for location over square footage. They are getting married later, and putting careers first.  They want to be close to the city centre, close enough to walk, bike, or rely on public transportation – not wasting time on commuting.”

“Enter demand for the growing lifestyle trend of micro-living, an affordable self-contained, open-plan living space designed to accommodate a bedroom, sitting area and kitchenette in 14–32 square metres situated in the city centre, close to all amenities.”

  1. PRIME LOCATIONS 

According to Horne, micro-flats are usually located near key employment nodes in CBD’s of major cities and universities – often in areas where development space is highly limited.  This adds to the appeal of these apartment, especially amongst young working professionals and students requiring convenient living.

“Student accommodation investment is also considered a very lucrative market (outside of a global pandemic scenario), so micro-living apartments near to universities will enjoy demand from student tenants, bringing in ongoing rental returns.”

  1. VARIED TARGET AUDIENCE

“In addition to millennials and students – there is a fairly wide range of target demographics that are drawn to micro-living apartments,” says Horne.

“Although the youth is currently the largest target market, micro-apartments are becoming relevant in several phases of life – making property investment in micro-living an opportunity for all generations.”

“Micro apartments also appeal to new working professionals branching out from their childhood home, and business travellers of all ages who purchase these apartments to stay in whilst travelling for work. There is also a market for the newly retired who are downscaling and wish to spend time travelling and not being hindered by the maintenance and upkeep of a larger home.”

  1. INITIAL INVESTMENT IS LOW

Horne advises that micro-living apartments are attractively priced for their location, allowing young people to get their foot on the property ladder.  “The key to real estate is to get your foot on the property ladder as early as possible and micro-living units are providing this opportunity.”

When it comes to investing in property for returns, the biggest concern is the substantial lump sum of capital needed to finance the purchase.  “Given the smaller property size of micro-apartments, the entry point for investors is much lower than that of say a 1- to 2-bedroom apartment. Moreover, the lower price presents the opportunity for property investors further up the ladder to purchase more than one apartment, so the risk is spread across multiple sources,” says Horne.

5. INCOME IS REWARDING, RUNNING COSTS ARE LOW

There are many benefits to micro-apartments, two that stand out is that their appealing modern amenities, combined with a central location make the return on square metre comparably high while still being in the price range of a far larger demographic, and furthermore, they generally have lower running costs and are more eco-friendly due to their size and new-build nature.”

“Once thought of as a necessary evil of city living, micro-living homes have been elevated to luxury status with high-design makeovers.  Gone are the days of cramped flats filled with impractical furniture.  Now we see expertly designed tiny homes with architectural interest, thought and style — places people want to live in and properties that offer a good investment – whether to get your foot on the property ladder or as a buy-to-let addition to an investment portfolio.”

WHERE CAN YOU FIND A MICRO-LIVING APARTMENT?

Paul Upton, head of developments for Dogon Group Properties unpacks a few of the micro-living offerings currently on the market in Cape Town.

1 On Albert in Woodstock Cape Town is a block of micro apartments, currently still under construction, that range in size from entry level 21 square metre studio apartments, at a cost of R1,095 million, to 75 square metre two-bedroom units, at a cost of up to R2,650 million for the bigger apartments.


“All the apartments at 1 On Albert – which were designed by award winning architects Louis Karol and the interiors of the apartments designed by leading hotel room designer Grant Gillis of Delta Interiors – feature top end SMEG appliances, flat screen smart TV’s and uncapped, unshaped 100megs per second fibre internet – to name but a few of the features. The development also features communal recreational spaces, shops, a food court, laundromat, heated swimming pool and more – all part of a new conceptual design in living known as integrated living solutions.”

“We have had high demand for the units at 1 On Albert and only 40 are available out of the 130 within the development.  Construction is estimated to be complete by December 2021.”

Foreshore Place is another current development being marketed by Dogon that offers micro-living apartments.  This mixed-use building is a redevelopment of an iconic 70’s high-rise in Cape Town’s downtown financial district on the corner of Adderley Street, Riebeek Street and St Georges Mall – previously known as the ABSA building.

“Foreshore Place has 15 floors of commercial space with the ground floor offering banking facilities, coffee shops, food and other shops, with 11 floors of residential units rising above, consisting of 99 one-bedroom apartments, nine two-bedroom apartments and 63 studio (micro-living)  apartments,” says Upton.

“The residential component of Foreshore Place features its own impressive lobby with 24hr concierge security with access control and CCTV, a laundry area, fully installed VOIP, high-speed fibre connectivity, satellite television ports, air-conditioning, parking bays and much more.  Completion of Foreshore Place is scheduled for February 2021.”

Dogon are also extremely excited to soon be offering apartments in a brand-new boutique micro-living development in Cape Town called The Ivory.  “Launching imminently, The Ivory will consist of 31 luxury micro-living apartments over 5 storey’s, situated on the corner of Kloof and Kings Roads in Fresnaye on the Atlantic Seaboard.  “There is nothing else like it on the market in South Africa currently and this exceptional and unique building will encapsulate the future of desirable modern-day micro living,” says Upton.

For more information on micro-living apartments currently available in Cape Town contact Dogon Group on 021 433 2580 or Paul Upton on 071 610 8088.  For details on 01 On Albert or Foreshore place contact Byron Kruger on 082 401 5179 and Keith Anderson on 083 540 5033.  You can also visit www.dogongroup.com.

 

This article was published in partnership with Media Xpose.

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