The Sloane Precinct ensures high standards of neatness, control and maintenance throughout the node. Blue-chip corporates like Tiger Brands, Microsoft, Di-Data and Dell Computers occupy large blocks of space. A new Virgin active gym which will be complete in December 2012 and the new 22 000m² Nicolway shopping centre are enhancing the appeal of this already highly desirable office node.
Business sentiment and perceptions of the area
The upgrade and widening of the William Nicol Interchange has reduced major bottlenecks and ensures free flowing traffic through its single point system. The presence of CCTV, variable messaging signs and incident management service ensures greater safety and traffic management.
Bryanston currently has about 560 000m² of office space. Most office buildings are owned by large property funds. There is still land available for development. These pockets have the relevant zoning, services and electricity; developers are waiting for tenants to drive these developments.
Recent large transactions confirm confidence in the node. The large development companies that own land in Bryanston include Zenprop, Tiber, Stratford Property Ventures and Barrow. Demand for these developments is slowly increasing and the signs are that development will hold steady in the future.
Prospective tenants are moving away from Sandton to Bryanston to avoid traffic congestion. Smaller users from Sunninghill and Rivonia are moving to Bryanston as it is deemed a more upmarket node with better accessibility and infrastructure. The Gautrain bus route runs from Sandton Station past Bryanston to Fourways Mall.
Leasing
Bryanston has not been impervious to the recent economic downturn, and 2011 saw an oversupply of offices as tenants defaulted on leases or failed to renew old leases. The average vacancy rate for 2011 was 10.5%. These increased vacancies put downward pressure on rentals early in 2011. A-grade office space dropped to R100/m2 in early 2011 down from the 2008 high of R115/m2. 2012 has seen a slight increase in demand for prime and A-grade offices. Current A-grade office rentals have increased to R110/m².
The vacancy rate has dropped below the 10% mark to 9%. Although market sentiment for 2012 has been more positive, it is difficult to predict the market uptake in the immediate future as
there are renewed fears of a second-dip recession or at least a very long period of sideways movement in office rentals. Landlords are offering various tenant incentives to secure good quality tenants. Tenant installation allowances have increased to an average of R450/m². There is also a trend by landlords towards offering rent free periods to secure good tenants
Source: Broll Research
