Centurion office market: much pressure, great value

Posted On Tuesday, 24 July 2012 12:06 Published by
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With the slowdown and the concomitant growth in vacancies the overall “rental value” of the Centurion area has “come under pressure” from a supply and demand point of view

 

This is according to Org Geldenhuys, managing director of property development and management company, Abacus DIVISIONS , a company who is currently involved with popular office park developments such as the Route 21 Corporate Park in Irene, and Highveld Techno Park in Centurion.

Office vacancy levels in the Centurion business area are currently sitting at between five and 20% - depending on the office park - and sitting at a fairly hefty 13.2% average according to the latest SAPOA Office Vacancy Survey. This is arguably partly due to over exuberant property developers moving in on the territory during the boom years. During the massive slump that was precipitated by the collapse of Lehman Brothers in the USA in 2008 the market has all but imploded – or at least leveled out dramatically.

Geldenhuys continues “Commercial property rental prices are certainly under pressure in the greater Centurion area at the moment. And with some 38,000m2  of committed development still waiting in the wings, the situation will not readily ameliorate.

Additionally, with the development of the Gautrain station near the Centurion Lake there has been a shift away from some areas to this area as companies recognize the benefits of being close to the station. This has placed more pressure on office parks that are located further away from the station,” said Geldenhuys.

He said the main “value proposition” that can now be marketed by property owners in the area is the fact that there are many office parks in Centurion that offer rentals that provide a very high price/performance ratio.

“It is true that rental prices are somewhat muted but this is definitely providing advantages for businesses. Centurion,” said Geldenhuys, “now provides companies with tremendously good value for many.”

He said prime office space can now be snapped up at leading office parks, such as Highveld Techno Park, for as little as R75 to R85 per square metre. “The upside for companies,” he said, “is that these are very cost effective rates. They are hard to beat from a value provision point of view.”

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