The Southern Basin’s proximity to the shipping hub has seen it hold up well during financial challenges.
Durban’s Southern Basin has been a hive of industry for decades and continues to see increased activity and development, even during the tough economic times.
Home to hundreds of different industries and industry leaders, the 24km precinct – which stretches from the Port of Durban to Umbogintwini, and includes industrial areas such as Bayhead, Congella, Clairwood, Isipingo, Jacobs, Maydon Wharf, Mobeni, and Prospecton – sees sustained demand due to its proximity to the port, says Samantha Anderson, Deal Core Property Group’s economist and area specialist.
Rentals in the precinct vary from R45/m2 to R65/m2 and, depending on the size and building type, she says it sees fluctuating levels of interest. As an example, in the industrial node of Jacobs, demand for 5 000m2 of good quality warehousing, with 7 or 8m heights to the eaves and 2 500m2 or more of yard, is most in demand.
“Tenants are primarily looking at this area for location. Part of Jacobs falls within Zone 1 from the harbour, which is highly sought after as it has the lowest logistics costs. Jacobs also offers low rental rates compared with other industrial suburbs of the Southern Basin,” Anderson says.
However, the Southern Basin has little available land in close proximity to the port and this has created the need for new warehousing facilities.
The R3.5 billion Clairwood Logistics Park, which is under construction, will not only help meet this need with the development of about 350 000m2 of A-grade warehousing and yard space, it will also bring about much-needed employment and businesses opportunities.
Anderson says the new development at the old Clairwood Racecourse site will offer state-of-the-art facilities, generous yard space and excellent security to large logistics companies.
“Unlike other buildings in the Southern Basin, which mostly consists of converted old factories, this development will provide tenants with warehousing options of substantial height and yard space.”
The logistics park will be fully operational only by December 2020, but Nico Prinsloo, development manager for the developers, Fortress Income Fund, says in the interim it will provide employment opportunities and enterprise developments.
“The park is expected to create almost 19 000 jobs during the four-year construction period and will create more than 4 000 permanent jobs after completion.”
The R135m road infrastructure upgrades that form part of the greater Clairwood Logistics Park project will begin to ease congestion and improve road safety by the end of next year, Prinsloo says. Material upgrades to surrounding roads, traffic intersections, pedestrian thoroughfares and on-ramps to the nearby M4 freeway are “integral” to the project’s approval.
“This is a two-year project in its own right. Construction on eight different upgrades began in October 2016. Despite challenges, we are on track to complete all road infrastructure improvements by the end of 2018.”
On completion, Prinsloo says the facility will be one of the country’s most innovative distribution hubs and will include about 360 000m2 of warehousing and large paved yards to park trucks.
While the road infrastructure upgrade takes shape, the park itself is “progressing well”.
Construction of the top structure on pocket one will begin this year and soil improvement and bulk infrastructure on pockets three and seven are almost complete. Soil improvement work on pockets two and seven has started.
Upgrades by the Transnet National Port Authority to some Maydon Wharf berths were completed this year, Anderson says.