Commercial tenants seek central offices with residential areas nearby
Developing properties in central locations is also of utmost importance, and the CBD is one area seeing a resurgence of interest from tenants and investors.
However, the focus of commercial property developers in the city “has to be on sustainability”, says Rabie Property Group director Colin Anderson. This includes water and energy, and also efficient office layouts that maximise occupancies.
“As rents increase tenants are looking for improved useable/ rentable ratios so they are not paying rent for spaces they do not occupy.”
With increased traffic congestion, tenants will look for central locations with good access to public transport and affordable residential areas.
Staff safety will also be paramount so precincts such as Century City, that have additional security, will be sought after.
There is still “strong demand” from tenants for office spaces. Craig Armstrong of FWJK Developments says the company is “bullish” on developing another substantial building in the CBD following Touchstone House in Bree Street.
There is also strong interest in investing in FWJK’s co-development at cost methodology, which Armstrong says cuts out conventional developer’s profit in acquiring sectional title property investments in the CBD – which will be one of the hotspots this year for commercial property development.
“We are noticing a strong move back to the CBD for business due to the amazing job the Central City Improvement District has done.
“FWJK has numerous high-rise developments under planning or about to start in the CBD,” says Armstrong.
Echoing this, Pam Golding Property Group’s chief executive Andrew Golding says the development boom continues in the city centre and the CCID puts the property valuation, once the current projects underway are completed this year, at R30billion.
Armstrong says the FWJK’s next construction starts in March and will be on its 16 on Bree mixed-use development which incorporates apartments and shops.
“This R1.3bn development will comprise 371 apartments and 1500m² of retail.”
Other FWJK developments include the Zero 2 One Tower development, which will be the tallest building in Cape Town when completed, and The Vogue on Buitengracht Street, a 38-story residential tower block.
Rabie is building new offices for Discovery and are in advanced negotiations for the balance of the 16400m² Sable Park developments.
It is also building some smaller offices from 50m² at The Manhattan Corner development for the smaller office user, Anderson says.
“Also, planning is well-advanced for a 6000m² office and showroom building, Sable Corner, which will be next to the new exit on to Sable Road.”
Anderson says planning has begun for a “major mixed-use development” in the Ratanga precinct.
Golding says the Harbour Arch development, which will be Cape Town’s first mixed-use development in the CBD, will be 5.8 hectares and have 200000m² of usable space, including six individual tower blocks.
Theprecinct, developed by the Amdec Group, uses the same principles that were applied at Melrose Arch in Gauteng, and will comprise open, landscaped spaces, restaurants, cocktail bars, hotels, gyms, office space and a selection of residential apartments.