Office rentals for triple A-grade space in Sandton CBD peak at R150/m² at present.

The latest phase of office development at Melrose Arch, 32,000m² of AAA-grade commercial space comprising ‘Offices on the Piazza’ is on schedule for completion in 2009. Built above the new 28,000m² Melrose Arch Shopping, the new offices reflect Melrose Arch's world-renowned commitment to new-urbanist planning principles, which blend a mix of complementary land uses.

"The new office phase at Melrose Arch looks set to achieve gross rentals of R200/m²," says Melrose Arch Development Company sales manager Mark Uhlmann.

But it’s not just rentals that are higher than in Sandton, adds Fran Teagle, director of commercial property at Broll Property Group. "Parking rates at Melrose Arch are R700/month, compared with R600/month in Sandton."

This, however, is not slowing down demand -- some 13,000m² of space already let and substantial portions currently under negotiation.

Melrose Arch is already respected as one of the most prestigious business addresses in South Africa and is home to corporate heavyweights like Allan Gray, Bidvest, the Bond Exchange of SA, Xstrata Coal and Xstrata Alloys and Stanlib.

"The bottom line is that Melrose Arch is directly competing with Sandton CBD for the same large users," adds Teagle.

Other brokers agree. As Mark Bradford of broking firm Bradford McCormack points out, Melrose Arch's new phase is perfectly timed to take advantage of several universal demand trends.

The first, he says, is that as fuel prices rise, the appeal of Melrose Arch’s live-work-play lifestyle becomes more and more alluring. The second is that Melrose Arch is located on a planned connector route for the Gautrain, which will enhance the node’s already excellent regional accessibility.

The third reason is semigration. "Increasing numbers of people are moving out of Johannesburg but still work in the city, which means that demand for commuter living has risen significantly," he elaborates. "That's translated into greater demand for apartment sales at Melrose Arch."

"The Offices in the Piazza are being brought onto the market at an ideal time to respond to strong demand and constrained availability. We're well-positioned to meet this need," adds Uhlmann.