SA commutable CBD space three times cheaper than London

Residential space in South African metropoles is three times less expensive than London’s inner city despite the fact that select properties in this country’s most prestigious suburbs are catching up with suburban prices abroad.

Barak Geffen, Executive Director of Sotheby's International Realty South Africa, attributes this to the fact that the metropole areas of New York, Paris, Tokyo and London are more congested and people will pay almost anything to avoid lengthy commutes and to be close to the amenities and attractions of the city.

“Demand outweighs available supply of decent space in large global commercial cities”, he says.

“London developers Candy & Candy are now selling what is regarded as some of the most expensive residential real estate in London at £4,200 per square foot (or R330 000/ square metre) at their luxury ‘One Hyde Park’ development,” he says.

And, according to Sotheby’s International Realty property brokers in capitals like Tokyo and Paris, it will cost you at least R7 million for 48 and 55 square metres respectively, which works out to R150 000 and R130 000 per square metre.

“London’s domination as a financial centre plays a large role in the much higher prices being achieved for residential real estate within CBD zones,” Geffen explains.

“In comparison, space at Cape Town’s prestigious Mandela Rhodes Place is selling at R26 000 per square metre and at Johannesburg’s Michaelangelo Towers at up to R40 000 per square metre, almost 8 less than that at the One Hyde Park development.

“It is no wonder that scores of local and overseas investors are being drawn to the Cape Town and Johannesburg CBD areas which, in comparison, continue to hold great value.”

Article by: Rodney Hayter - www.rodneyhayter.com