The two BCom graduates are buying old warehouses and factories in areas close to the Louis Botha Avenue corridor northeast of Johannesburg. They are converting these properties into lifestyle estates where the rent for a self-contained studio unit roughly the size of a single garage is an average R2,500/month. Each so-called nano unit of 15m² has its own bathroom and kitchenette.
Huff says the big selling point behind the Live Easy concept is the added lifestyle amenities. These include common lounge and braai areas, a canteen, a gym, crèche, indoor and outdoor playgrounds, laundromat and hair salon.
Huff says people who typically earn a net income of R5,000-R7,000/month and can’t afford to pay more than R2,500/month on rent often end up staying in someone’s backyard or in an overcrowded flat in Hillbrow.
“Live Easy provides a clean, safe and affordable alternative. Our concept, which essentially offers estate living for lower-income singles, couples and young families, hasn’t been available in Johannesburg before,” says Huff.
The first phase of 136 nano units in the flagship Live Easy development in Kew, previously an Isca tap factory, was fully let a month before completion in September last year. There’s already a long waiting list of prospective tenants for a further 123 units under construction at the Kew development, and another 280 units are in the pipeline.
Five other Live Easy developments, in nearby Bramley, Balfour Park and Highlands North, are in various stages of planning and will bring an additional 1,233 residential units to the market over the next 12-24 months.
Froom and Huff met a few years ago while they were both involved in Johannesburg inner-city office-to-flat conversion projects. Froom, an accountant, previously specialised in bridging finance and structured property transactions, while UCT graduate Huff has a background in property broking and project management.
While there are plenty of old, underperforming properties across Johannesburg that are ripe for redevelopment, the challenge for developers like Froom and Huff is to buy at the right price in the right location. Froom says their strategy is to focus only on areas that provide easy access to public transport nodes.
“We believe the sweet spot can be found in old industrial areas on the fringes of business hubs such as Rosebank and Sandton, as they are close to places of employment.”
The strategy of Froom and Huff to focus on redevelopment opportunities in industrial areas, as opposed to office or residential nodes, also makes sense from the point of view of a return on investment. Not only is it much cheaper to buy a factory in Kew than an office block in Braamfontein, for instance, but the conversion process is also typically much shorter. Froom says that’s because certain industrial buildings can be redeveloped for residential use without having to go the lengthy and onerous route of municipal rezoning. Also, industrial buildings often have large floor plates that are well suited for the addition of multiple residential units.
Froom and Huff believe they have only scratched the surface with their nano unit offering. Says Huff: “I don’t think you can build this type of product fast enough — there’s really no end to demand.”
