Developers are discovering the pleasure and profit of reviving old urban precincts instead of building new ones such as Johannesburg's Melrose Arch and Sandton's Illovo Boulevard.

Milpark, sandwiched between trendy Melville, high-density Braamfontein and up-market Westcliff, is one example. Two years ago, Lifestyle Lofts MD Ricky Polack developed 19 loft apartments in the area. Starting prices at The Refinery, corner Owl and Stanley streets, in 2002 were R240 000/180 m².

The next two phases of the project are under way, and all 15 remaining lofts are sold. "We discourage buy-to-let investors," says Polack. "So most of our lofts are owner-occupied."

The highest price achieved to date is R1,15m for a four-level unit. "The owner has already been offered R3,5m for his loft - three months after he bought it," says Polack.

Today, other investors are flocking into the node.

Milpark Mews, corner Barry Hertzog Avenue and Empire Road, has 324 apartments, two-thirds of which are sold out, says David Green, MD of Pace Properties, which is marketing the project. Construction hasn't started yet and new units will not be available for occupation until late in 2005.

Prices at Milpark Mews are staunchly middle-income. All the studios, at R295 000 each for about 30 m², are sold out. Two-bed units are around 63 m².

"We've priced units at R10 000/m² but this includes attorney fees and transfer costs," says Green. "Don't forget that these are today's prices for units that will be available in a year's time."

Buyers, he adds, are less concerned about the size than the cost of the units. A deposit of R25 000 secured their pads.

"For a student or a young professional, the bond repayments are cheaper than renting a cottage in Melville," says Green. There's the potential for capital growth, too.

Polack is a little concerned, though. He chose Milpark for its bohemian and avant garde vibe, but he says new supply is mass-produced. "A 30 m² unit is the size of a double garage."

Nor is it just the residential option that is capturing the imagination of developers in Milpark.

Funky minimall 44 Stanley Avenue was the next success in Milpark. An unusual collection of shops, galleries and trendy hang-outs, the redeveloped industrial quarter has proven popular with students, lecturers and shoppers in search of out-of-the ordinary goods.

Hot on the heels of 44 Stanley, developers saw a gap for more shopping facilities, especially as the residential population began to grow.

Milpark Galleries shopping centre was mothballed in the early 1990s and remains a sad and empty reminder of more festive days at restaurants such as Late Nite Al's.

But The Gallery, as it is now called, is to be redeveloped into 6 000 m² of shopping space, anchored by a national supermarket. It will form the second phase of the Milpark Mews residential project.

The fate of the adjacent Holiday Inn has seemed gloomy in recent years. But the lease has been renewed for 10 years - and the hotel group (Southern Sun) has committed to a R30m revamp.

Office vacancies are dropping steadily, according to data from the SA Property Owners' Association (Sapoa). From 8% a year ago, vacancies in Milpark now stand at 6,1%. A-grade vacancies are a mere 0,5% compared with 6,5% a year ago. But there's no new office development on the go, says Sapoa.

Polack also sold six sectional-title commercial suites at Turbine office park in adjoining Cottesloe at R2 000/m² for an unfinished shell. An additional residential development of 23 lofts forms part of the project, and Polack says he has waiting lists of up to 200 would-be buyers.

Green says that people who work at Naspers, the SABC, Absa Call Centre and Auto & General in the area have bought at Milpark Mews. So have Muslims who want to be close to the new Greenside mosque, which will be completed early next year.

Financial Mail