Some property pundits say retail development usually follows large-scale residential development. But there is concern that retailing could be problematic, with surges in foot traffic at weekends and drop-offs during the week as many investors buy a second or third home.
Stephanie Wynne Cole, the Cape West Coast area manager for Pam Golding Properties, says several large parcels of West Coast land have been sold recently to developers. The group expects this to result in sectional title and fractional ownership estates in and around a number of the area's small towns.
Pam Golding Properties also reports a steady trade in stand alone properties, security village units and vacant single plots in the same area.
Spearhead Property Holdings, the Cape Town-based JSE-listed property loan stock company, believes retail developments are following these "decentralised hamlet-style residential developments". CEO Mike Flax says: "I know of about three (medium sized) shopping centre developments along the West Coast that are either in planning or under construction."
He says that Spearhead may consider acquiring one or more of these.
David Green, MD of property brokers Pace Property Group, says that in Gauteng, at Hartebeespoort Dam, growth in residential development has increased the need for retail developments.
Over the past 12 months there have been at least four new retail developments in the Hartebeespoort Dam area ranging in size from 3,000m² to 12,000m², with plans for even larger centres.
"With these hamlet developments many of the investors are acquiring second properties, which they do not occupy during the week.
"That's difficult for retailers because they experience heavy trade on weekends and limited trade during the week, and sometimes it's not feasible for retailers to operate in those areas."
Green says the fact that the Cape West Coast has the lowest population levels of any South African coastline makes it even more difficult to sustain retail developments in secondary residential areas there.
At De Kelders residential development near Gansbaai, for example, Pace Property Group recently sold 78 units, yet there is no retail development in the area, with the closest shopping centre 6km away. Green says retailers must be mindful that residences in the area are not occupied for seven days of the week.
Paul Theodosiou, MD of Acucap Properties, says the Cape market is fairly well balanced in retail property supply.
But if there is scope for retail development it would be along the West Coast between Tableview and the West Coast Village.
Residential growth along the West Coast has boosted retail at the Bayside and Canal Walk shopping centres.
"If a regional shopping centre had to come up between Tableview and the West Coast it would capture a lot of that retail spend."
Theodosiou says another concern is road infrastructure.
"There is all this development out there but no commensurate improvement to the roads.
"You are getting congestion and bottlenecks."
Business Day
Publisher: I-Net Bridge
Source: I-Net Bridge
