“Parade on Kloof” Office Park is situated within the upmarket Bedfordview node and has excellent access to the highway system via the Van Buren off-ramp as well as access to Eastgate and Bedford Centre Retail Complex, both of which are within 2 minutes driving time.

PROPERTY DETAILS

ERF DESCRIPTION:

eRF 132 Oriel, measuring 4358 m²

ZONING

The property is zoned Business 2 for offices and other commercial uses with an unlimited floor space ratio and a minimum of a two-story height restriction and parking requirements of 4 Nº bays per 100m².

THE SECTIONAL TITLE BUILDINGS

The property will be developed as single building with potential for two entrances. The two storey building will be modern in character with a single roof pitch split in two sections to individualisation of the two entrances. The single pitch will create the opportunity for certain of the upper floors to create mezzanine with associated roof gardens.

The façade of the building will be an alternative combination of glass, steel, sandstone and plaster.

The building itself will total 2426m² which will be split into separate sectional title units ranging in size from 150m² upwards. The first floor suites on the eastern side will have mezzanine floors.

The parking has been provided on the basis of 4.5 Nº bays/ 100m² of office space, plus additional parking will be paved off the street to accommodate visitors.

Each individual office entrance will have its own front door off the main lobby of the office block, conveniently situated with regard to the visitors and parking access points.

Each suite will have its own exclusive toilet and kitchen facilities.

The units are available for ownership on a sectional title basis and can be amalgamated if necessary to provide the size required by the perspective purchaser. Each unit will be allocated a minimum number of parking bays as per the schedule.

FINISHES AND INSTALLATION ALLOWANCE

Each unit will come complete with toilets and kitchens, toilet, acoustic ceilings, lay-in fluorescent lighting, plastered walls, and electrical plugs and telephone jacks at obvious points.
In addition, an allowance of R700.00/m² based on the area of the offices will be available to the purchaser/ tenant payable on transfer. The rationale for including the finishes in the price of the unit is to ensure that this cost can be covered by the investors’ bond. Alternatively, the purchaser can elect to deduct this off the price and pay for the installation out of his own cashflow.

Note: The owner of each unit will be responsible for his own fit-out of the premises utilising this allowance. The Developers will however undertake the installation on behalf of the owner, upon request. Alternatively the Developer can provide a list of recommended contractors specialising in tenant installations should this be required.

Each unit’s electricity will be separately metered.

PARADE ON KLOOF BODY CORPORATE

The Parade on Kloof sectional title scheme will have a Body Corporate of elected owners who will administer the office block themselves, including the security, landscaping, maintenance and other issues common to the office park.

THE DEVELOPMENT TEAM

The development will be undertaken by Brydens Commercial Properties, an active developer in the Johannesburg region, with an excellent track record.
A full Professional Team will be employed on the contract as follows :
Architects : Boogertman & Partners
Project Managers: Brydens
Quantity Surveyor: Russell Irons & Associates
Electrical Engineer: VBI Projects
Civil Engineer: Tony Butterworth & Associates
Landscape Architect: To be advised

DEVELOPMENT PERIOD

The building will be complete in the 1st Quarter of 2008

PRICE

The units including the full specification, are priced from R11 000.00/m². The prospective purchaser is also obliged to purchase a pro-rated ratio of basement/ shadenet and/ or open bays.

INITIAL RETURNS AND RENTALS

Generally, the investment will show a return based on the bonded amount of approximately 11%, based on office rentals of R80.00/ m² patios at R15/m², basement bays at R400.00/ bay, covered bays at R300/ bays, and open bays at R200.00/ bay. The 1st year return calculated here is based on a deposit of 20%.

OPERATING COSTS

An estimate of the operating costs of R14.85 per m² is shown below

SECTIONAL TITLE OWNERSHIP

Sectional title ownership is an accepted form of property tenure in South Africa, against which banks are more than prepared to grant bond finance.

Whereas in freehold title the owner has ownership over the land, under a Sectional Title scheme the owner would have the exclusive use of a unit (being the internal area of the office as defined by the four walls surrounding the unit), as well as other defined areas such as parking bays, garages, storerooms and the like.

The common area, i.e. gardens, access ways, etc., are held by each unit in an undivided share.

Upon registration of the Sectional Title scheme the Body Corporate is automatically instated, and has the ability to enter into contractual relationships with security, landscape gardeners, and the like.

SUSPENSIVE CONDITIONS

The offer herewith is subject to the following suspensive conditions:

a. The site development plan being approved by the relevant authorities.
b. 50% of the sales being achieved.

CONCLUSION

The concept of small sectional title offices has been well received in the Johannesburg area. The Developers are considered leaders in this field and have completed a number of schemes all of which have been sold out within months of being launched. Please refer to their website www.brydensgroup.com for other schemes that they are in the process of constructing.

The concept is based on the following critical success factors :

° AFFORDABILITY

The owner-occupier will find that the bond repayment is commensurate with a market- related rental.

° QUALITY

The sectional title units are of A-grade quality with a more than adequate installation allowance of R700/m²

° WASTAGE FACTOR

Tenants and owner-occupiers alike are averse to paying rental on a common area, which can be as much as 30% of the rental in traditionally designed office blocks.
Typically common areas consist of large entrance foyers, lobbies, toilets and communal kitchen facilities, as well as the passages accessing the individual tenants’ premises. In the scheme on offer, although the lobbies are well appointed, they are modest in size and do not form part of the rentable area of the premises, nor do they form part of the purchase price of each unit.

° OWN FRONT DOOR

The owner-occupier or tenant of the offices is afforded a high profile with a front door off the main lobby, and not at the end of a dark corridor, as is the case in traditional office blocks.

° PRIVATE BALCONIES/ TERRACES

The provision of one or more private balconies/ terraces in each unit is a highly attractive bonus.

° SELF-CONTAINED TOILETS AND KITCHENS

The provision of private toilets and kitchenettes in each unit provides each owner-occupier/ tenant with its own autonomy.

° ASSET CREATION

Each sectional title unit is a highly sort after investment and will provide the owner/occupier with a long-term revenue producing asset, as well as providing increasing capital growth.
In conclusion, the small sectional title office concept is highly focussed on the needs of the smaller business, and has been extremely successfully implemented by the developer in schemes elsewhere.

PARADE ON KLOOF OFFICE PARK
OPERATING COST ESTIMATE/ PROJECTED BODY CORPORATE LEVY as at 15/02/2007

Assessment rates	R 4.60
Other Municipal charges	R 0.32
Garden maintenance	R 0.97
Window Cleaning	R 0.24
Cleaning	R 0.65
Insurance	R 0.79
Security (based on 24-hours)	R 4.28
Administration fees	R 1.95
Electricity and water	as consumed
Airconditioning maintenance	owner's responsibility
Audit Fee	R 0.10
Pest Control	R 0.25
Meter reading	R 0.20
Maintenance Sinking Fund	R 0.50
TOTAL	R14.85