Linbro Park

Posted On Thursday, 01 March 2001 03:01 Published by
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LINBRO Business Park, just off the N3 highway in Sandton, has launched its fourth phase of 20ha. This brings the total development to date to 80ha, out of its full potential of 110ha,

LINBRO Business Park, just off the N3 highway in Sandton, has launched its fourth phase of 20ha. This brings the total development to date to 80ha, out of its full potential of 110ha, says RPP Developments chairman Mike Crawford.
The park, which is being developed, managed and marketed by RPP, covers an area larger than Strijdom Park in Randburg.
It is being developed as a coherent unit for light industry, and ranks among the biggest single developments of its kind in SA.
Buildings covering more than 200000m² have been completed at an estimated value of R600m. The total value of the completed park is expected to rise to R1,3bn.
Crawford says past rapid growth augurs well for the continued success of the park. It is expected phase four will be developed by the end of next year, with all the sites taken up.
Roads and infrastructure in this phase will be completed next month, and 5ha of fourthphase land has been sold or is in the final stages of negotiation.
The final phase of 14ha could accommodate one large user, or, depending on demand, could be subdivided into smaller sites, continuing a trend already set in the park.
More than R3m was spent recently on the entrance and a one-way road system to facilitate the daily traffic flow of 7000 vehicles, says Crawford.
Prices of land have breached the R240m² barrier, which Crawford says, is indicative of the strong demand for industrial land in a prime area.
The development of Linbro village, catering for smaller businesses, will complement the wide range of businesses accommodated in the park.

'The village concept is one of the first of its kind to be introduced in an industrial park in SA, and promises to be a success.'
An important factor is the high ratio of office accommodation to the warehousing component in the park. Crawford says this has lifted standards and encouraged more companies to combine head offices with their warehouses.
To uphold these standards, purchasers are not entitled to sell their properties until such time as their development plans have been approved and the buildings erected.
The park has attracted many owner occupiers which, Crawford says, adds to the diverse nature of its investors.
Accessibility has been enhanced by the upgrading of Marlboro Drive in 1999.
'It brings the park within easy reach of the Sandton CBD and surrounding areas and has improved traffic flow in the area,' says Crawford.
Linbro will have a total building area of 550000m². Businesses in the completed park will employ about 13000 people.
All buyers are obliged to become members of the park owners' association when they invest in the project. The association controls aspects such as access control, housekeeping, street pavements and management of common areas.
Crawford says sites in the park have been planned in nodes, grouping smaller user and larger users.
Traffic flow is smooth. Vehicles enter by a security gate. Two parallel roads run through the heart of the park. They are linked by crossroads, enabling easy navigation and location of businesses, he says. 'Linbro Business Park provides a quality environment for a new generation of light industry.'
Sector follows executives north
INDUSTRIAL property development nowadays tends to take place close to the residential areas of the decision-makers in the economy's main sectors.
In Gauteng, this implies a migration to the north, says Erwin Rode, CE of property analysts and valuers Rode & Associates.
'What is important in the northern areas of greater Johannesburg is the access the industrial areas have to major freeways. Linbro Park, for instance, is just off the N3 and this is what makes it so successful.'
Rode says despite the northward shift, Jet Park in the east remains popular because of its good access to the freeway and proximity to Johannesburg International Airport. In addition it is a modern township.
'Most modern industrial parks provide a secure environment with controlled access. This should mean better longterm demand for space and thus long-term growth in rentals.'
Rode says the older industrial areas, especially on the East Rand and in the south catering for heavy industry, are a stagnating segment of the market.
There is no clear answer, he says, to what will happen to the industries on the East Rand.
Rode says the trend globally is towards light industries, favouring the establishment of industrial miniparks. As smaller manufacturers need less space, many of them can use the smaller stands industrial parks offer.
What Rode describes as the golden rule works in north and northeast Gauteng that is, for industry to be close to upmarket residential areas, where the decision-makers live, with easy access to major freeways.
Offering an alternative to Midrand
THE location and accessibility of Linbro Business Park factors crucial to the modern industrial park make it a viable alternative to Midrand, says Arthur Millar, manager of Colliers RMS industrial division.
The nature of the industrial park market, dominated as it is by the warehousing and distribution industries, makes access to major road arteries essential.
'Linbro Park, on the Johannesburg ring road, has easy access to all points of greater Johannesburg and environs.'
The park's location is another advantage its proximity to Sandton central business district making it unnecessary for firms to open offices in Sandton.
'Many of the businesses have combined warehouses and offices on the same premises. Combining the office and business infrastructure under one roof is cost-effective, avoiding duplication of services, like reception, for instance.'
Security, maintenance and aesthetic standards provide investor comfort, he says.
'As Linbro tends to attract the warehousing, distribution and high-tech industries, it offers a pleasant working environment without the industrial feel of older industrial areas.'
Because of the mix of the size of available stands and buildings, from those right for a minifactory to ones accommodating large multinational groups, Millar says any potential property requirements can be met. New phases offer a chance to expand.
Also, he says, there are plans to develop adjacent AECI land to provide retail, residential and business nodes to form a new urban nucleus. It will become a small city, making investment in Linbro more attractive.
'Linbro is only five years old, but the long-term investment potential is enormous,' Millar says.
Joint venture aims at unlocking land value
BoE Corporate has upbeat view of village's potential to fill need for smaller units
LOCATION is what Linbro Business Park is all about. It is situated in an area that could become SA's new industrial heart, close to Sandton, the new financial hub of southern Africa, says Louis Schnetler, property investment manager at BoE Corporate.
BoE Corporate is RPP Development's joint partner in Linbro's village development.
Schnetler says the main purpose of the village is to unlock land value. BoE and RPP will sell the buildings on completion.
'We believe there is a demand for such a scheme. It provides suitable space for the smaller manufacturer.
'Market research shows there is a need for smaller units in industrial parks and we're very bullish on this venture.'
In its property investments BoE Corporate: Property Investment Partners looks at growth in value, something which Schnetler says Linbro offers, being in an industrial area with good potential.
The park meets what he considers four crucial criteria.
'These are access to freeways, good location, security and a high visibility from the N3. But all these points are of limited value if the park is not well managed, which is another plus factor for Linbro.'
BoE Corporate: Property Finance has financed four or five bigger units in the park. This, says Schnetler, indicates the finance firm's long-term view of Linbro's potential.
'We've been in the development of the park since its launch about four or five years ago. It shows that we are happy with Linbro as a whole.'
In the case of the joint venture on the park's village, the company is not only providing the financial muscle for the initial development but will also finance the buildings for the owners who are setting up business there, should they meet the financial criteria.
'We don't have a problem with this, ' he says, 'as we have found that office components in industrial parks tend to be smart. And smart offices attract top-of-the-range warehouses.'
Schnetler says he believes there is a sound future for smaller units in secure industrial parks in high-growth areas.
'This is the scenario for Linbro and that is why we believe the village will be a success.'
Strong demand for sites from the outset
SITES at the 110ha Linbro Business Park, all serviced, were taken up almost as fast as they came on the market.
The strong demand reflected the need for secure, well located, well designed, high visibility industrial space, says marketing manager Brian Rose.
The 40ha first-phase section of the R1,3bn development was proclaimed in March 1996 and the 20ha second phase followed a year later. The recent announcement of the 20ha fourth- phase launch brings the total development to date to 80ha.
The third phase of the development entailed relocation of powerlines affecting a 7ha site at the entrance and enabling sites to be created ranging in size from 2400m² to a hectare.
These sites are close to sellout and include recently completed buildings occupied by Ace Casinos, Gracehaven Industries, AECI Coatings, Introstat and Cosi Distribution.
Also, there have been major road improvements at the entrance, creating a one-way system improving traffic flow.
Rose says the park has grown rapidly since the early days in 1997, when Amalgamated Beverage Industries, Canon Business Equipment, Hazard Electronics and Sanlam Properties (Gensec) completed their developments.
There have since been major developments by International Healthcare Distributors, MGX Holdings and Namibia Breweries, all with buildings in excess of 10000m² .
A weighty factor in Linbro's success in creating a healthy balance of users has been the large number of owner-occupiers, with buildings in the 1000 to 3000m² rang, who have had the confidence to invest in the park.
Linbro Village, the freehold title project, will also enhance the park's strength and diversity. With more than 100 firms already in the park, Rose says phase four is sure to succeed, as there is a broad range of sites
Turnaround time critical
A PASSING view from the N3 freeway helped Vinimark decide to relocate their business to Linbro Park, says company executive Harry van Dyk.
'I liked what I saw and it seemed a good idea to move. Not many places in the area are as well maintained.'
Vinimark, a recent arrival at Linbro, are distributors of wine and spirits, and turnaround time is critical.
'Our clients particularly restaurateurs only keep limited stocks and timely deliveries are crucial to them. Deliveries are expected within 24 hours.
'Many of our clients, including chain stores, hypermarkets, restaurants and bottle stores, are in the northern areas of greater Johannesburg, making it easier to service them from Linbro.'
Vinimark's previous warehouse only had two loading bays, slowing down turnaround times. At Linbro the company was able to custom-design its warehouse for its operational needs by making provision for 11 loading bays.
'At the old premises, loading operations only ended at noon, but with 11 bays we can now load 11 trucks and have them on their way by 9.30am.'
Being in the liquor distribution trade, with upmarket brands from Pernod Ricard, customer entertainment is an important aspect.
'The old place did not lend itself to business entertainment or wine-tasting functions because of lack of space and the absence of landscaped gardens.
'Linbro provides these facilities, which make our current warehouse a suitable venue.
'It offers more than a warehouse facility,' says Van Dyk.
Other companies are following suit. Euro Steel is moving its main Gauteng operation to a specification-built factory in Linbro Park, says director Tony Freeman.
The company, a diversified group of speciality metals stockists and distributors, with branches in Gauteng, Natal and Cape Town, was founded nearly 10 years ago.
It has grown from a small, mainly trading, operation to a countrywide distributor of stainless steels, alloys and aluminium products to industries in both southern and central Africa.
Apart from space requirements because of growth, Linbro was identified for a number of reasons, says Freeman.
These include easy access to the N3 freeway, the high calibre of existing park occupants, enhancing property value and safety for Euro Steel's staff and visitors.
Long-term potential for investors in light industry
Growth area attracts a variety of tenants
AS part of a new growth point, Linbro Business Park has a longterm future, says marketing manager Brian Rose.
The park, one of RPP Developments' current projects, provides more than 100ha light industrial and warehousing with convenient access to the M1 and N1 freeways. It has induced a number of businesses to relocate from various areas of greater Johannesburg.
'The businesses range from component manufacturers for the electronic industry to pharmaceutical, beer and wine distributors and a biscuit factory.
'At this stage of development phase three is finished the park has more than 100 firms, occupying about 60ha,' he says.
'The fourth phase of 20ha is being serviced, which will be followed by the opening up of a further 14ha. On offer in Linbro Park are sites varying in size from 2000m² to 14ha, so we can accommodate the needs of a wide range of businesses.'
Linbro village, begun recently, is offering smaller businesses an opportunity to purchase 230m² to 600m² buildings with freehold title.
Rose says he believes the park will remain a sought-after area for the next few decades because of its good location, as proved by the fact there are few vacant stands left in the first three phases of development.
'We command the top range of rentals in terms of industrial rates, which proves there is value in the land here.
'Being in the high-rental bracket is important, as rentals govern property values, which in turn makes the park attractive to investors,' he says.
Several warehousing and distribution firms have established head offices, giving the park a high-ratio office element.
This, says Rose, helps to maintain the high standards of the park. Offices generally are more expensive to build, thus encouraging greater attention to landscaping and the design of buildings than would have been the case had the warehousing and light industrial factor dominated totally.
'We watch the quality of the buildings going up in the park as well as the type of tenants. We have overall control and do not permit land speculation and restrict speculative development.'
GALAXY PARK has been designed as a park within a park with its own entrance to give the occupants the feel of being apart yet a part of the activities of greater Linbro, says marketing director Brian Rose
The 10000m² complex was developed by RPP Developments on a 2,4ha site at a cost of R22m.
The design of the buildings make provision for signage that blends with structures facing the N3 freeway. Three of the Galaxy units have freeway frontage.
No pylon signage is permitted in the business park facing the freeway. All signage must be incorporated with the building and is subject to the park owners' association's approval.
Gross rentals are R35m² for office space and R23m² for warehouses. Units are from 950m² to 2000m² and the office area makes up more than 30% of the complex, indicating demand for high office ratios.
Galaxy started with three buildings let to Waco Logistics, Maslex and Kodak with its head office, laboratories and warehouse

Publisher: Business Day
Source: Business Day

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