Latest News
Is the Cape now also reflecting superior property management practices?
25 November 2011
In terms of tenant behavior and payment profile data collated by TPN, trends in the commercial property arena suggest a reasonable scenario as measured during Q3 2011; this is of course against a volatile economic, political and global backdrop. Tenants in `good standing’ (on time payers + late payers; see image below) represent 81% of the leasing market; up from 73% a year back. `Nonpayment’ conditions have also improved and is sitting at 8% (some 2-4% better than what is reported for the residential sector over the past three quarters); perhaps somewhat understandably commercial payment tardiness is significantly higher than what is reported for the residential market at around 20% vs 14%.
TPN data suggests that Gauteng poses the greatest property management challenge when it comes to rental collections whereas the Western Cape trends above the national average. This begs the question as to whether this is simply reflective of different business cultures/practices, or indeed whether Cape based property managers are superior to their Gauteng compatriots.
Office demand still taking a siesta
1 November 2011
For now, no improvement in the demand for office space is detectable, this according to the latest issue of Rode’s Report on the State of the South African Property Market (2011:3).
Explains Erwin Rode, property economist and publisher of the Report: “Uncertain economic conditions are obviously affecting business confidence and must be making firms think twice about expanding their premises or hiring new staff. The result will no doubt be a continued lacklustre demand for office space to rent and thus, for now, moderate growth in rentals remains the most likely outcome.”
Evidence in support of the importance of the services sector to the office market is illustrated in the graph which follows. The graph shows the robust tendency for the growth in output produced by the services sector and the growth in the demand for office space (net of the growth in stock) to move together over time. Evident from the graph is that net annual growth in demand for office space was still negative in the second quarter of 2011. Read more
Clock Tower Offices revamp complete
October 2011
80m² UP TO 1 000M² TO LET
Click here or on Picture for more info
The recently refurbished Clock Tower Offices are situated at the heart of busy V&A Waterfront, and feature external balconies and terraces, allowing tenants to enjoy their new offices that boast magnificent mountain and sea views. The close proximity to freeways and the CBD make the Clock Tower offices and ideal location for any type of tenant. Read More
Is there something someone isn’t telling us?
August 2011
Listed Property continues its good form: According to Catalyst, SA Listed Property, as an asset class, has recorded the highest total return for the last 12 months (14.73%); in July listed property recorded the highest total return (+ 1.60%) of the four traditional asset classes with Bonds (1.42%) and Cash (0.44%) were next best performing asset classes for the month, whilst general equities recorded a total negative return of -1.99%. Read more
BLACKRIVER PARK
July 2011
Black River Park has become home to some well-known national and international companies and leading brands as well as the smaller companies looking for smaller space. Why not make this your new Office?
SIDEWAYS MOVE FOR INDUSTRIAL, OFFICES
July 2011
The first SAPOA Office vacancy survey of 2011 shows little change to vacancy levels in most of the Cape Town.
nodes surveyed, according to Dave Russell of SAPOA.
“The total office vacancy in the Cape Town CBD is now at 9.8% where a year ago it was 9.1%. In the
Rondebosch/Newlands node there has been an increase from 4.8% to 5.9% in the past year, along with the V&A
Waterfront where there was a small increase from 2.9% to 3.7%.”
Russell says areas which have enjoyed a decrease in vacancies over the past year are Claremont, where it has
reduced from 16.6% to 12.7%, Pinelands down from 5.2% to 4.8%, and Century City where a vacancy of 11.7%
last year is now down to 10.2%. In Bellville the vacancies remained the same as a year ago at 6.2%.
“With no significant speculative office developments taking place, a major change to these figures is not
anticipated,” Russell says.
CPA’s likely impacts on commercial property leases
June 2011
With the implementation of the Consumer Protection Act (CPA), South African consumers may now very well be amongst the most protected in the world. However the Act does come with potential problems for commercial property owners due to the onerous requirements it places on the management of lease agreements and tenancies.
There are several important factors for property owners to take note of:
SA property market begins recovery in 2010
SAPOA
29 March 2011
The commercial real estate market returned to double-digit annual performance last year.
South Africa’s commercial real estate market returned to double-digit annual performance last year, with a 13.3%, bouncing back from 2009’s eleven-year low of 8.8%, according to the SAPOA / IPD South Africa Property Index.
The headline total return is still dominated by the income component, which was 8.9%, while capital growth was 4.1%. After 18 months of little-to-no capital growth, confidence and fundamentals began their recovery over the second half of last year, during which period the bulk of the year’s annual capital growth was delivered. Read more
The outlook for property investors
17 February 2011
The performance of listed property remains closely correlated to bond yields and not necessarily underlying fundamentals. On the latter aspect there is little doubt that a closer relationship is required to ascertain real value. However, exactly as to how these fundamentals will unfold is up for debate and depending on who you speak with, differences of opinion is not uncommon. Some uncertainty and risk is of course good for those seeking to gain `arbitrage’ advantage. Read more
Things to consider when looking for commercial space
11 February 2011
When seeking to relocate or looking to lease commercial premises for the first time, tenants are faced with a host of factors which need to be considered.
In order to ensure that this decision is both financially right and business optimal, Sean Liebenberg offers sound advice borne “from years of experience in managing extensive commercial property portfolios for clients”:
“Firstly, location plays a major role in deciding where to situate an office, or lease space. Whether it be for image, proximity to clients, the market or staff residential areas – and transport networks, choosing the right location should take into account a balance of factors that will optimise business opportunities and productivity. Consult a property broker for advice on available premises in your preferred area and at the appropriate rental cost of various grades of office space. Once a budget is determined, consider the options which provide best value for money.” Read more
Listed property outstrips equities, bonds in 2010
Norbert Sasse
13 January 2011
Analysts believe that listed property is poised to perform strongly again in 2011.
South African listed property posted an impressive 29.6% total return for the year 2010, notably outstripping both the All Share and the All Bond indices which posted total returns of some 18% and 15%, respectively.
The numbers speak for themselves and again establish that listed property has an essential place in any serious investor’s portfolio. Read more
ASSET CLASS RETURNS
Click here or on the picture to view the enlarged version.
This shows that Real Estate and Commercial Property are still your number 1 investment!
Westlake Square office for sale
January 2011
Measuring just 93m² in the well sort after Westlake Square this small unit is for sale with two parking bays for just R 1.3 Million. For more pictures and details on the the unit click here
Conveniently situated alongside Westlake lifestyle centre, with Virgin Gym on the other side of the road and plenty restaurants and coffee shops to entertain clients.
Yields come down although risk increases
December 2010
Prime office income capitalisation rates (cap rate) have marginally strengthened during the course of Q4 2010 as compared with Q4 2009. This is reflected in the graph below showing the average rate as captured in the Sapoa Cap & Discount rate survey conducted in Oct/Nov 2010.
Average caprates across all commercial property types (including retail and industrial) is 10.37% which is 10 basis points down on a year earlier (10.47%). Read More
END OF YEAR IS UPON US, MERRY CHRISTMAS OFFICE DEALS AVAILABLE
December 2010
CBD
- Pinnacle: 200m² up to 1800m² from R 55/m².
- ABSA Building: 150m² up to 1000m² from R 85/m².
- Metropolitan Building: 400m² – 1000m² from R90/m².
CLAREMONT/NEWLANDS/RONDEBOSCH
- Boundary Terraces: 220m² up to 350m² from R 105/m².
- Great Westerford: 300m² up to 1000m² from R 115/m².
CENTURY CITY
- All Buildings in Century Century ranging from 80m² up to 3000m² from R90/m².
For more info on any buildings or inquiries as to what space is available and where and what price please call us anytime on 021 685 3822 or 082 339 2722 alternatively send us a mail to info@commercialspace.co.za
Aside from those properties listed above we have numbeous other offices available and are able to source offices literally anywhere in the Western Cape so contact us no matter what your commercial property requirements are.
Cash is king – Graham Power
November 2010
But the best time to buy property is now, he says, while we are at the bottom end of the cycle.
CAPE TOWN - Interest rates will be cut by ½% or more before the end of the year, according to Graham Power, the founder and board chairman of the Power Group. Speaking at the SA Property Investor Club Breakfast last week, Power says, “most people in property have taken a serious knock,” but he firmly believes the tide has turned and the worst is over.
Power has being in property, be it construction, development or otherwise, for about 27 years and has “bumped his head and nose many times” but has come out smiling and runs a business today that employs close to 2 000 people. He has seen a number of market shifts in his day and believes “this is the worst cycle we could have imagined”. Read more
SA Investment Property: differentiated from global markets on many levels
12 November 2010
A story of timing, inflation and monetary policy.. oh yes and throw in the emerging ingredient too
South Africa’s commercial property market is often cited an outlier within the global real estate universe – and for good reason: South Africa outperformed all other property markets on a local currency basis in seven out of nine years for which IPD has sufficient data to produce a global index.
Since the last property boom started to gain traction, in 2003, nominal capital values have virtually doubled in seven years, rising by 97.4%. This includes a cumulative rise of 23% over the three years to end 2009 – the period when the global financial crisis struck, prompting a severe re–pricing in commercial property values in virtually all other markets worldwide.
End investor returns are also supported by strong income returns relative to most major real estate investment markets: The 10–year annualized income return or yield is 9.7; income growth is driven by contracted rental uplifts linked to inflation and by a growing economy creating demand for space. Read More
CENTURY CITY HAS OFFICES FOR SALE AND TO LET
10 November 2010
With the newly available serviced office land; Century City now offers businesses the opportunity to buy and build their own premises or have it built for them to spec. With the vast amount of new offices available in this growing and extremely popular office node, its no wonder most Cape Tonians are turning to Century City to place there offices.
With rentals ranging from R 80/m² up to R 130/m² there are choices for all office users to look at. From as small as 100m² up to 4000m² Century City along with Commercial Space can help you to source the right premises for your business location.
For more info on Century City and to enquire about availabe space please dont hesitate to Contact Us or alternatively call us on 021 685 3822.
Growthpoint’s Sasse is cautiously optimistic
26 October 2010
South Africa’s largest listed property company Growthpoint believes the country as a whole has turned a corner and is of the opinion that the effects of the recession will be lessened during the next 12 to 24 months, which will open up growth opportunities. However, the company’s CEO, Norbert Sasse is cautious about vacancy rates in current conditions and of oversupply.
While vacancies are still on the increase, Sasse foresees debt in arrears deteriorating slowly. Read more
You can cash in on listed property
11 October 2010
Many South Africans choose fixed property as an investment because it is relatively simple to understand and avoids some of the tax burdens associated with other investments — but listed property’s virtues have been largely ignored. Read more
OFFICE VACANCY SURVEY - CAPE TOWN
To get an idea of market related rentals and what is being achieved in the Western Cape when it comes to leasing offices in Cape Town and its surrounding areas click here
Office vacancies seemingly leveling off
September 2010
After showing the strains of weak economic activity for a number of quarters, office vacancies in both the decentralized and CBD markets are seemingly levelling off.
In the second quarter of 2010, vacancies were, on a national basis, roughly at the same level as the previous quarter. This came on the back of an improvement over the same period in employment in finance, insurance, real estate and business services, as reported by Statistics SA. The graph shows that CBD vacancies have performed ― relative to decentralized offices ― amazingly well since 2009. However, it should be pointed out that this improvement might be illusionary because so many office buildings in the CBDs have been boarded up (i.e. taken out of the ‘space available for letting’ category), or have slipped from grade B into grade C (the latter category is not tracked by Sapoa). These comments do not apply to the Cape Town CBD, of course. Read more
Commercial Property Confidence (CPCI): Is the outlook cautiously optimistic, or not?
In the early part of 2010, the eProp CPCI index showed some early signs of improvement having reached a level of 47 as at February/March 2009. With 50 being neutral, the reading was still largely negative, but certainly an improvement from the levels of 36 and 37 registered in the preceding bi-annual periods.
The bi–annual eProp Commercial Property Confidence Index (CPCI) Survey is based on a mix of ten equally weighted variables comprising both ‘hard’ and ‘soft’ business conditions; the index reflects a six month forward projection for the commercial property sector. Read more
Industrial vacancies still on a par with long-term averages
August 2010
A look at industrial vacancy trends shows that there is, as yet, no need for industrial property investors to panic and make friends with their bankers.
Vacancies have been showing a strong northward trend over the past few quarters — on the back of severe weaknesses in the industrial property market’s two support pillars, namely retail sales and manufacturing activity. Nevertheless, current vacancy levels are still more or less on a par with their 19-year averages (refer Table 1). On the Rode industrial vacancy scale, the Central Witwatersrand still recorded a vacancy factor of only 2,2 in the first quarter of 2010 compared to a long-term average of 2,6. Both figures denote that vacancies are, in the opinion of our panellists, still ‘low’ (1—3), with ‘high’ being a figure of 7—9.
In some other cities, the comparable figures were as follows:
Cape Peninsula 2,9 (3,2), Port Elizabeth 3,0 (3,0) and Durban 3,3 (2,5) (long-term averages in brackets). Read more
Buying your own Business/office/warehouse property instead of being a tenant
20 July 2010
The debate continues over whether or not it is better to own your own business premises or be a tenant and pay the landlord a monthly rental.
There are many factors in deciding which side you should be on and it is most certainly an informed and very important decision to be making considering that your rent is your largest if not second largest expense when running your company.
For a more in depth report on whether you should be renting or buying, Email us to see what we would suggest for your business.
We have financiers in place to assist you in purchasing your own office/building/warehouse should we feel that be the right decision for you. It is worth noting that your company should be at least five years old in order for us to approve finance for owning your own property.
The driver of malls’ success turns the corner
JUNE 2010
Some cause for optimism for shopping-centre landlords has been the recovery in retail sales volumes over the past few months.
In March 2010, the yearly growth in real retail sales turned the corner — from contraction to expansion — by growing by 1%; this after 13 consecutive months of contracting sales volumes. Read more
Make the right property choice
“Effective use of property can increase profitability, attract quality staff, enhance your image and make your business more efficient and easy to run.”
We realize the importance of property to your business as it is an issue which impacts on every company in Cape Town. It is vital that businesses think about property issues and the effect that property – from use to location – has on competitiveness.
In Cape Town we are noticing significant change in the property market and any successful business cannot afford to ignore this key area.
For most companies property is the second highest business cost.
Commercial property usually represents over a third of total business assets;
and running costs can be the second highest cost after wages. Property is therefore key to business success: not only does it dominate your financial
statements, but it can also provide real competitive advantage through its location, the working and sales environments it provides, and
the image and profile it supports.
A lack of strategic awareness around property means that many companies have little knowledge of their property costs. Email Commercial Space for assistance with your property needs!
Email us or contact us on 021 685 3822 