Old Mutual Properties has entered into a joint venture with City Property Administration to convert one of its buildings in the Johannesburg central business district from office space into residential apartments.

The R33m redevelopment of the New Plaza building at 150 Jeppe Street is one of four Old Mutual buildings in the inner city to have been identified for conversion in the joint venture, giving impetus to plans to rejuvenate Johannesburg .

Old Mutual's announcement yesterday follows government's launch last week of new tax breaks in Cape Town and Johannesburg to encourage investment in the inner cities .

Old Mutual Properties executive director Rowland Chute said yesterday the company had been working on a rejuvenation strategy for its buildings in the Johannesburg central business district for some time, and the urban tax incentive scheme was a plus factor.

The redevelopment, to be called Plaza Place, will create 211 apartments .

Chute said the apartments would be ready for occupation by early 2006.

He said they had chosen City Property Administration, which manages two JSE Securities Exchange SA-listed property loan stock companies, Octodec Investments and Premium Properties, as a partner because it had a track record in the inner-city market in Pretoria.

"We want to build on their expertise in Johannesburg," he said.

City Property has over the past four years created more than 2000 residential units in vacant and obsolete office buildings in the central business district.

Neil Fraser, executive director of the Central Johannesburg Partnership, a nonprofit company dedicated to the revitalisation and regeneration of the Johannesburg inner city, welcomed the news of Old Mutual's entry, saying there were many smaller investors doing regeneration work.

Fraser said it was nice to see an institution like Old Mutual, which had been "fairly cold on the inner city for some time", recognising the progress made with revitalisation efforts .

Property economist Francois Viruly said most activity in Johannesburg's inner city at the moment centred on the residential use of functionally obsolete office buildings.

Business Day