A Snapshot of The Western Cape Commercial and Industrial Property Climate

Commercial sector

• Generally sluggish with very little movement in the market place
• Tenants are able to re-negotiate leases on favourable terms
• Triple A-grade office space in the CBD is plentiful which is putting downward pressure on good quality A-grade buildings to levels below R90/m² gross excl VAT
• Century City is the destination of choice with sectional title and leased units being snapped up off plan
  
   

Industrial sector

• A shortage of big box A-grade warehousing
• Electricity costs are negatively impacting on the manufacturing industry which is reliant on heavy power. Landlords are having to reduce rentals to assist these tenants
• Over supply of industrial units in the size range from 100m² to 700m²
• A shortage of vacant industrial buildings for sale for owner / occupiers
• Land sales remain sluggish despite there being a shortage of serviced sites
  
   

Investment Sales

• Strong demand
• Short supply
• Yields range from 7.5% to 10% depending on type and quality of property, covenant by tenant and terms of lease