This is one of the findings of a study of the city’s office and retail sectors. The study was commissioned by Old Mutual Investment Group Property Investments (OMIGPI) which has just concluded the purchase of a vacant CBD site off Buitengracht from the City Council for R89,2 million.
 
The addition to Old Mutual holdings in the CBD is in line with OMIGPI’s aim to grow assets under management to R100 billion by 2015.
 
“The study indicates demand for office space in greater Cape Town can be expected to grow at an annual 107 000m² through to 2015,” says Brent Wiltshire, business development executive for OMIGPI.
 
“If Cape Town CBD maintains its 40% share of the metropolitan office market, demand for office space in the CBD will be about 43 000m² a year, according to the study.”
 
Wiltshire says the study found there are plans for an additional 60 000m² of office space in the metro area, 24 000m² of this being in the CBD.
 
He says the study notes office development typically comes in lumps, rather than an even distribution each year, with projects delivering more than the average annual demand.
 
“It also notes that after two decades of decline, with decentralisation and residential growth creating strong nodes away from the CBD, work done on improving the inner city has brought a change in fortunes.
 
“According to the study, it appears the CBD has turned a corner with total available office space increasing, total occupied office square meterage increasing and vacancy levels dropping to 6,5% for the period 2002 to 2007.
 
“The report says the growth in the office rental market is also good news for retail. Most shoppers in the CBD are people working in the city, it says, and the increase in workers will positively affect retail.”
 
More than 1,1 million passenger trips on public transport are made daily into the city, with rail accounting for 53% of the total, the report said.
 
Priority projects for the regional rail system included extension of the Khayelitsha line with two new stations, an increase in trains on priority corridors, upgrading of stations, and refurbishment of the fleet. Priority corridors had also been identified for road-based public transport.
 
A survey of 100 small, medium and large companies leasing CBD offices reflected the primary advantage of a city location was its central base, for clients and employees.
 
“A further component of the research found that four of five CBD residents worked in the city centre, the primary reasons being convenience to work and to retail facilities.
 
“The convenience benefit was also reflected in vehicle usage, with 44% of those households surveyed not having the use of a vehicle.”
Publisher: Old Mutual Investment Group Property Investments
Source: Od Mutual Investment Group Property Investments