A buyers & tenant market

Posted On Monday, 18 March 2002 03:01 Published by
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IN the past year, the industrial property market has continued to be a ‘buyers and tenants market’, with static prices and rentals in all industrial nodes. However, with the recent fall of the Rand,
IN the past year, the industrial property market has continued to be a ‘buyers and tenants market’, with static prices and rentals in all industrial nodes. However, with the recent fall of the Rand, building prices are likely to rapidly drive up the commencing rentals of new developments.
A typical warehouse with a small component of offices located in a area such as Montague Gardens, would now command a commencing gross rental of approximately R22 per sq m. So reports Andy Beddow of Baker Street Properties.
Considering rentals in older industrial nodes, such as Epping and Bellville, are still at levels of around R8,50 to R10,50 per sq m, it can be expected that the vacancies in these older locations will begin to be taken up over the next 12 months. For companies seeking modern high-roofed distribution warehouses, the options are very limited.
Two such warehouses totalling 12 000sq m have just been let in Montague Gardens at between R16 and R20 per sq m.
Very few industrial developments are taking place, with the exception of semi-retail type distribution centres on well exposed sites, predominantly in the Montague Gardens area. Land sales generally are sluggish, but activity is expected at the new ‘Airport City’ development located adjacent to Cape Town International Airport. Focus is being placed on safety and security , including electrified fencing, surveillance cameras and 24 hour guarding services, which will appeal to the market.
The Baker Street office division has been extremely active despite tough market conditions. The over supply of offices in most areas have created excellent opportunities for tenants to secure extremely competitive deals in the Cape Town CBD and surrounding areas.
The office division concluded over 45 000sq m of office leases with a rental value in excess of R250 million.

Publisher: Cape Business News
Source: Cape Business News

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