Cape Town commercial sites sell for a premium

Posted On Friday, 14 August 2009 02:00 Published by eProp Commercial Property News
Rate this item
(0 votes)

Alliance Group has hosted its monthly auction at Cape Town’s One&Only resort, offering a plush location for properties warranting five-star treatment.

Rael Levitt

Aside from the opportunity to view the renowned Sol Kerzner hotel, the quality of commercial properties on offer prompted good attendance. The function room was filled to capacity with more than 300 people, including blue-chip players, newcomers and smaller league bidders.

The auction started with the sale of 12 Station Road, Montague Gardens, in Cape Town, which was confirmed at R5,06m.

“This is going to be a good auction. I can just sense it,” a regular Alliance client remarked.

Voortrekker Road, Maitland, secured its rightful position as demand for two light-industrial properties proved resilient to market forces. “People buy the income in addition to the real estate,” said auctioneer Rael Levitt.

A vacant building at 412 Voortrekker Road, zoned for commercial two use, was sold for R9,1m. “This perhaps indicates that real estate is in fact getting back on track for its bricks-and mortar value,” Levitt said.

The old Spec Tiles ground floor site of Cliffe Dekker, in Buitengracht Street, central Cape Town, secured a bid of R4,5m, a price above its previous sale price in April.

ICG House, belonging to Media24, attracted an opening bid of R25m and then was pushed up to a R33m hammer price. Within 48 hours the sale had been confirmed at R36,8m, including commission.

“It has been a tough economy for all, and many previously chose to sit and watch for the market to bottom out,” said Michael Barr of Alliance. “What was witnessed today was that price, position, unique properties and reasonable sellers and buyers are finally coming together.”

One bidder attributed the change to the recent appointment of Gill Marcus at the Reserve Bank and a fresh approach to monetary policy.

Another felt commercial properties with unique attributes were always a sound investment and one should not overlook opportunity on the auction floor.

“The auction floor is real; it exposes the properties’ salient features on a national level, encouraging all interested parties to bid. Once it comes under the gavel, demand and supply determine the final equilibrium,” the bidder said.

“If there is surplus value, the higher price will be forced out of the bidders, but discerning buyers know their game. The objective is to procure quality assets, not necessarily at bargain basement prices, but rather ones that reflect the current market value''.

Last modified on Wednesday, 18 June 2014 19:19

Please publish modules in offcanvas position.