Businesses are not coming back to the CBD

ARROWHEAD Properties CEO Gerald Leissner has spent much of his life trying to save the CBDs of South Africa's major cities. As part of the Central Johannesburg Partnership, in particular, the then-boss of Ampros battled in vain during the 1990s to keep big companies in the inner city.

ARROWHEAD Properties CEO Gerald Leissner has spent much of his life trying to save the CBDs of South Africa's major cities. As part of the Central Johannesburg Partnership, in particular, the then-boss of Ampros battled in vain during the 1990s to keep big companies in the inner city.

Today, he is happy to steer his ship well clear of CBD properties, preferring to extract value from unfancied regional and peri-urban office, industrial and retail space. He is more excited about the prospects for his listed residential holdings than about the former centre of economic power.

"The idea that office tenants are going to flock back to the city, it's not going to happen. Today your office market is basically different levels of government."

On the bright side, Leissner believes Jewel City has worked well. "The diamond dealers say the benefit of being where they are is that everything's together - cutters, buyers, the bourse - and the rent is cheap. To create that in Midrand, they would pay three times the rent.

"So that works. For the rest? They tried to create a fashion district; it's okay, but nothing special.

"The Market Theatre precinct and Maboneng have cleaned up the city to an extent - those have become trendy areas, there's some residential, the art, the restaurants. How big that will become and whether it will sustain itself in the long term, one will see.

"The Brickfields residential component, which belongs to the Johannesburg Housing Company, has been successful. But it hasn't brought back commercial business. It hasn't brought back offices. As much as one would like something to happen, it's not going to change much."