The building of three much talked-about blocks of flats in Sandton has been cancelled.

Of the three projects, two The Sandown and Sandown Isle will not go ahead because of an increase in building costs .

The third, The Axis on Grayston, was cancelled after objections from a neighbouring commercial property to a residential development.

This comes less than a year after Metro reported that as a result of the squeeze for space in Sandton, 11 residential buildings were going up.

The developments included the 34-storey Michelangelo Towers, which is nearing completion, a 15-storey building near the corner of Grayston Drive and Rivonia Road, and a 13-storey block on the corner of Grayston Drive and West Road South.

In a statement, Investec said the owners of their building, Growthpoint Properties, had objected to The Axis on Grayston because of a negative reaction to residential projects.

They felt that the highrise apartments would devalue Investecs headquarters across the road.

Hylton Katz of Key Spirit Development said his company would probably build an office block on the land where it had intended to build the 323-unit luxury block of flats.

Ronald Ennik of Pam Golding Properties said the cancellation of the projects was bound to happen.

A lot of development has been taking place in the central Sandton area, probably too much development for the demand, taking into account the fact that the market was quieting slightly, said Ennik.

He added that he was aware of other similar residential developments that were not going ahead.

Herschel Jawitz of Jawitz Properties said a combination of the increased building costs and the fact that highrise residential development, especially in the Sandton area, has been overheated for some time, resulted in a decrease in demand for the units.

Building costs have certainly gone up, but its not stopping people building in other areas, he said.

Paul le Sueur, managing director of Group Five Building, said the building industry, which had been under pressure for 25 years, was playing catch-up to the booming property industry.

Where the average price for residential development in the area is between R7 000 and R8 000/m, it is about half that price for commercial development, ranging between R3 500 and R4 000/m.

As far as bricks and mortar go, your prices will be exactly the same, he said.

However, Le Sueur said the cost of residential developments was higher than commercial projects because they were more complex and involved more finishings.

But the bottom line is that property experts dont think the failure of the three developments will have a negative impact on the area.

Cara Reilly, marketing brand manager of Sandton Central, said: Its an interesting time, but I dont think its going to affect the 24/7 vibe thats being created in the area.

Ennik said he supported the creation of a mixed-use area, where residential and commercial properties were all within walking distance of each other.

He said it was better to have a few developments withdraw at the early stages, instead of having 15 developments come onto the market and then all battle to sell.

Jawitz also supported the building of a mix of residential and commercial properties in Sandton.

I think that mixed-use is very attractive ... Its not good for all the suburbs, but I think in Sandton it works very well.

Sunday Times