SA Corporate (SAC) CEO Craig Ewin said on Friday that industrial leases concluded in Gauteng and KZN saw rental increases of up to 47%.
SA Corporate (SAC) CEO Craig Ewin said on Friday that five major industrial leases concluded in Gauteng for warehouse space of 1,800m2 to 8,00m2 saw rental increases of 12.5% to 30% while in KwaZulu-Natal, increases ranged from 16% to 47%, on five leases for industrial space between 2,200m2 and 10,000m2.
He added that rental upliftment on new industrial leases signed by SA Corporate Real Estate Fund in the six months to June 30 was very encouraging, and that the rental upliftment on the leases in Gauteng and KwaZulu-Natal were a weighted average 28%, some 12% ahead of budget.
“These increases have brought rentals on the premises in line with the market which is seeing gross rentals of R40m2 being achieved for better quality industrial space with the R50m2 mark being seen for prime new industrial developments. Annual escalation rates are also on the rise as a result of the limited availability and demand for quality premises and the impact that this having on rental growth,” said Ewin.
He added that the healthy increases in rentals in the industrial sector underscore strong economic fundamentals and demand for well-located distribution and warehousing facilities.
“SA Corporate’s industrial portfolio continues to perform strongly with vacancies of less than 0.5% of lettable area,” he said.
SA Corporate Real Estate Fund will increase the industrial component of its seven billion rand portfolio to 33% through the one billion rand acquisition of 40 properties from the Collins Property Group. – Nicole Rego, I-Net Bridge