What was once three apartment blocks managed through a family-owned trust in downtown Bloemfontein, is planned to become innovative shared accommodation catering for up to 300 residents to help meet the increasing demand for cost-effective, secure, and multi-purpose living in one of South Africa’s rapidly growing student towns.
Five years ago, two friends founded Dimatone PTY LTD and purchased a house in Bloemfontein close to the university. Ruben Moggee and Theuns Myburgh converted it to student accommodation and the rest, as they say, is history.
“We began looking for other opportunities to develop more properties specifically focused on shared rooming and student accommodation. This is one of the key industries in Bloemfontein, and by 2020 we had already purchased and converted five properties catering for 50 students,” says Moggee, a director in the company.
However, the duo wanted to take on a larger accommodation project and when they came across the three apartment blocks up for sale, they recognised a keen opportunity to further their ambitions. The three apartment blocks had been with the same owners for 30-years with some tenants living there for the past two decades.
“While the apartment blocks presented us with an incredible opportunity, we felt it was too large a transaction to bite off on our own. Using our existing properties as collateral, we partnered with Trust for Urban Housing Finance (TUHF) for assistance. In such a short space of time, and despite the challenges posed by the COVID-19 pandemic, we aimed to launch the accommodation in March this year,” says Moggee.
The trend over the past five years with an average of over 6 000 properties sold per year (2015 to 2019), indicates a marked drop in registered sales for 2020. Hard lockdown took effect within the second quarter of the year, impacting the South African economy, and specifically the property industry's ability to do business.
As a result, pent-up demand due to the Covid-19 pandemic and restrictive lockdown measures will continue to impact trends, with average sales per year only expected to recover towards the end of 2021.
The latest property listings on Property24 show that two- and three-bedroom homes are most widely available. Some 40% of buyers interested in making Bloemfontein their home are below the age of 35-years. While sellers in the area fall within the 36-49 years (34%) and 50-64 years (29%) age group.
Click here to see all the latest trend data for Bloemfontein.
Focused renovations
The three apartment blocks are next to one another and situated next to the renovated SARS offices. With joined off-street parking access behind the buildings, the site offers a perfect location to echo the revamping process currently underway in Bloemfontein.
“Existing shared- rooming, student accommodation and new builds are extremely small. These apartment blocks feature large rooms that can be utilised to create a nice atmosphere for young professionals as well as students,” says Moggee.
“As part of the product, the apartments are offered as furnished and also comply with specifications received from the tertiary institutions, each apartment has to feature breakout and recreational areas and provide a unique onsite living experience. This fits the mixed-use zoning and character of the blocks perfectly as minimal to no configuration changes are required.”
To this end, Dimatone examined how best to optimise the 78 apartments to reflect modern furnishes and shared living that fits the commercial tenants on the ground floor. The bulk of the project has consisted of internal renovations and fit outs, ripping out the old carpets and restoring the original parkay flooring to its former glory.
As part of the renovation process, each apartment will be fully furnished, including a fridge, microwave, stove, beds, desks for studying purposes, and even storage spaces for books. There will also be uncapped Wi-Fi throughout the buildings, so tenants would just need to bring their bedding and clothes and move in.
“There will be a combination of bachelor/one-bedroom flats, two- and three-bedroom apartments. We are also in the process of establishing several recreational areas for residents that will feature televisions, a pool table and table tennis, as well as an outside braai area. The blocks will also have a common laundry area for tenants to do their washing and drying. Of course, security is critically important to give tenants peace of mind. As such, we have introduced physical access gates, cameras throughout the buildings, and will be installing biometric scanners for access control prior to opening,” adds Moggee.
Growth opportunities
The existing tenants were given preference to stay, where some have chosen to remain and embrace multi-purpose living, while those who wanted to find alternative housing were given as much time as they needed to move out during last year.
“Our existing team of managers will oversee the rental aspect of the accommodation while we focus on the renovations. We also have a close working relationship with NSFAS (National Student Financial Aid Scheme) so that we know exactly how to structure our agreements to benefit students from a rates perspective,” says Moggee.
He says they want to create an atmosphere where tenants will feel comfortable. “It really needs to be a home away from home.”
Moggee says without the assistance of TUHF, none of this would have been possible. “Our relationship with TUHF is not a traditional, transactional one. Instead, it is a true partnership where they have been supportive and understanding of the challenges posed by the pandemic. This will definitely not be our last project with them.”
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