AS THE Gautrain development gains momentum, so too does the demand for commercial space in the vicinity of the stations — a trend already evident near the Sandton and Rosebank stations.

Lia Pauley, leasing and sales broker for JHI, says the property services company is seeing a surge in interest and inquiries from local and international corporate tenants wishing to relocate to the central business districts of Sandton and Rosebank. Investors have also shown a preference for “green” buildings.

“Such inquiries reveal that these prospective tenants have thoroughly researched the market and the location,” Ms Pauley says.

“They know that by being in the hub of either Sandton or Rosebank, they are also within easy reach of hotels, shops and residences.”

In addition, the shift in tenants and companies seeking “green buildings” reflects a growing awareness of the Green Council ratings and a desire to benefit, in the long term, from realistic rentals and reduced service charges.

“This growing trend towards a demand for space near the Gautrain stations will have a marked, positive impact on nearby office and industrial areas that meet these criteria as business, tourism and other commuters begin taking advantage of this convenient new transport facility,” says Ms Pauley.

A further spin-off is anticipated in that retail developments near the Gautrain stations are likely to enjoy increased trade as commuters have the convenience of being able to purchase goods en route to their destinations.

The proposed new tolls which seem set to be imposed on commuters are another reason to use the new transport system.

For commercial tenants this is coupled with a potential saving on high parking rental charges, which are in the region of R500-R685 a month for a basement bay in Sandton, and between R500 and R785 a month in Rosebank.

Ms Pauley says the convenience factor is considerable, given that bumper-to-bumper traffic on the highways is a regular occurrence.

She says another interesting trend that has emerged is towards the redevelopment of existing buildings due to higher bulk being granted by the council to landlords who own buildings in close proximity to the Gautrain stations in Sandton and Rosebank.

This will further boost the commercial property market in these nodes.

In Sandton the demand is mainly in the rental market, with gross rentals — which include operating costs, rates and taxes — somewhere between R120/m2 and R171/m2 for Grade A and R80/m2-R100/m2 for Grade B premises.

However, investors are also showing an appetite for acquisition of land or buildings for redevelopment — again close to the Gautrain station. Ms Pauley says: “Sandton remains the financial hub of Johannesburg and still has room for development, particularly in the sectional title office unit sector as well as smaller office blocks where owner-occupiers can reflect their own identity.”

Source: Business Day