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Description
The property is location adjacent to very popular Istiklal Caddesi (Independence Street) and within 150 meters of the Netherlands and Russian consulates.
The building in currently empty and will require a major renovation in order to maximize its potential.
Investment Strategy
Our strategy is to renovate this property in a way that that maintains its classical charm while adding modern design and amenities . The building requires substantial renovation that includes installing an elevator, reorganizing the interior partitions, new windows and doors, a new roof, new electrical and sanitary systems, and all interior finishes. The property’s proximity to Istiklal Caddesi’s extraordinary pedestrian traffic levels, will push us to market the ground floor and 1st floor as retail and the top four floors residential. Ideally, we believe a restaurant would be an efficient use of the ground floor and basement with a bookstore or small offices on the 1st floor. The top four floors are large enough to target several niches in the market, including young professionals, couples with and without children, foreign second home buyers, and corporate housing.
Timeline
Due to this property’s designation as 2nd degree historical, we have factored in a delay in obtaining permits in creating a realistic timeline of 15 months. Architectural plans and government approvals should take 8 months, followed by 7 months of construction. Pre-rental agreements will begin during the later stages of construction
Beyoglu, Istanbul
Place Overseas has primarily focused on the Beyoglu submarket for investment properties due to our belief that the area is the most undervalued area in Istanbul for long term growth potential.
Beyoglu is considered the city centre for the transportation network, social scene and cultural venues, but over the past several decades have seen the city’s elite move to the suburbs where newly constructed housing and plentiful land offered a better lifestyle.
Recently however, there has begun a shift of people moving back to the city centre as roadway traffic has become a major issue and the municipalities have started to undertake action to regenerate much of the problematic aspects associated with living in the city centre.
Istanbul’s highways and streets are at capacity and in many areas expanding mass transit is the only available alternative to relieve this congestion. Beyoglu is very well served by public transportation. Beyoglu‘s mass transit infrastructure includes a regional bus hub, a major metro station, two ferry ports, a light rail line, a funicular, and the Tunel (the world’s 2nd oldest underground trolley). In addition, the Turkish government is currently extending the metro line south to the seaside city of Yenikapi and north to the Maslak business district.
Beyoglu, which is steeped in history from the Ottoman times with many buildings exhibiting classic Greek and Armenian architecture had been discarded for some time by the more well heeled Istanbulites. The area had become a dangerous place to walk late at night despite the vibrant nightlife. Much of the building stock had been left untended and discarded. This however is changing, the Beyoglu municipality has been actively working to redevelop the area while keeping the cultural integrity intact. A critical mass of redevelopment work has begun and the momentum for change in the area is becoming more obvious by the day. Rents have started increasing as high income individuals have become more keen to live there.
Market Segmentation for Beyoglu
1. Young Professionals
Beyoglu is a very popular area among young professionals due to the extensive social and nightlife options found around Taksim. The area’s atmosphere is fast-paced and busy and is accessible by public transportation from nearly every major region in Istanbul. A majority of the high-paying industries such as banking, energy, telecoms, real estate, and medical services can be found near the major Central Business District corridor that includes Maslak, Levent, Gayrettepe, ªiºli, and Taksim and they are all conveniently connected to Beyoglu via the Metro line.
2. International Corporations “buying a hotel room”
International Corporations are a potential client of residential properties that is often overlooked by investors. Many companies look to purchase or rent properties to house temporarily stationed employees rather than continuously booking hotel rooms. With a concentration of international corporations in the vicinity of Beyoglu, this market segment has significant potential.
3. Foreign second home buyers
Beyoglu is one of the most popular districts in Istanbul for foreign buyers of real estate. As a result, several neighborhoods in Beyoglu have reached the ceiling of 0.5 percentage of land in any given district that can be owned by foreigners as described by in the Turkish Foreign Direct Investment law of 2003. The law is changing to allow more foreign persons to purchase by increasing the ceiling to 10%.
4. Couples w/o children
Dual income couples without children are often able to better afford the kind of lifestyle that Beyoglu offers. Many of the same amenities that appeal to single young professionals also apply to professional couples; parks, cafes, upscale restaurants, plentiful retail options, and are all available in Beyoglu.
5. Urban families
There is a segment of families in Istanbul that either prefer an urban environment or find it a necessary due to the location of their jobs and decide to settle down in the core Istanbul neighborhoods. While this segment often cannot afford the price points of many of the renovated or newly constructed buildings that our investors will provide the market with, it is important to take note of this segment and continuously try to find opportunities to broaden the spectrum of potential customers.
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