However, in town-planning matters delays are not necessarily universally slow throughout the country, says Wayne Wright, Gauteng leasing and sales director of JHI Real Estate.
"Holders of unproclaimed, vacant or underdeveloped land parcels have a valuable asset, and should think carefully, creatively and strategically about how best to maximise opportunities, while at the same time being cognizant of socioeconomic and environmental effects of development."
Wright says that office land value is represented typically as a rate per square metre of bulk, bulk being the amount of space that a building can occupy over one or more floors on the site.
He says in Johannesburg the bulk rate of office land can range from R800m? to R3000m?.
"More often than not this +250% difference in land price will still favour the pricier market, even though the market rental difference is only about 100%, implying that location considerations remain crucial.
"This shows that the rentals required to make new leasehold developments feasible could generally serve to push prime rentals to new highs, provided the services sector continues growing."
Similarly, holders of existing commercial buildings have scope to rebrand their buildings and the opportunity to command higher rentals, although generally lower than a new development facing above-inflation building and land-cost escalations, he says.
Even functionally obsolete industrial facilities in fundamentally sound locations become valuable, if only for the land and the existing rights.
Wright says that to ensure optimal and mutually beneficial solutions are found, greater partnering between suppliers and end-users of space is required.
Meanwhile, in Johannesburg commercial property organisation Sapoa has arranged a workshop for its members and the metropolitan planning division of the municipality.
CEO Neil Gopal says the purpose of the workshop is for the city - and specifically the metro planning section - to present the spatial development framework and some key themes, including densification and nodal development.
Business Day
Publisher: I-Net Bridge
Source: I-Net Bridge
