Commercial property up on boom in residential demand
THE commercial property market is experiencing a well-deserved revival that reflects the economic growth and regeneration under way in SA, says Moreland Property commercial and industrial director Mike Deighton.
His comments echo the most recent data released by the commercial property confidence index. Released by eProp, the index measures expectations over the next six months, and the latest data indicates a rise from 74 early this year to 75 by July-August.
eProp research director Marc Schneider says this implies that expectations around business conditions for the rest of the year are slightly stronger, indicating a positive outlook for investors.
Dealing with the Umhlanga Ridge area, Deighton says the dramatic growth in demand for residential property developments translated into an upswing in commercial property demand. The sold out signs were already up within the La Lucia Ridge Office Estate, where 200000m² of bulk land had been developed within a decade, he says.
The Umhlanga Ridge has expanded as Durbans newest central business district and has been recognised as the fastest-growing residential and commercial hub in the country. The R1,5bn Gateway shopping centre had proved its mettle in being a catalyst for growth in the area, supporting the shopping and entertainment demands for the expanding residential community.
This synergy encapsulates sustainability, whereby residential and commercial property developments are done simultaneously. More than 1200 residential units are currently being built in the Gateway phase one precinct, Deighton says.
Phase two of the development includes a 2ha park as a green lung and places the large corporate offices around its outskirts.
Last year more than R80m worth of land sales were concluded on the Umhlanga Ridge.
Deighton says the concept of living and working within the same space is gaining ground. Internationally, communities thrive on a boulevard existence, where commercial, light industrial and residential land use vie for space.
This is the experience the Umhlanga new town centre as well as the planned Cornubia development quadrant inland from Umhlanga are bringing to the KwaZulu-Natal north coast, he says.
To be established towards the end of next year, Cornubia will offer opportunities for business parks, residential estates across the economic and social spectrum, mixed-use and industrial development.
It has a real role in the creation of this whole node and brings with it work and housing opportunities for previously marginalised people. It will be part and parcel of sustaining the development and enhancing the great way of life north of Durban, Deighton says.
Medium-term planning involves wholesale development from the Umhlanga River to Verulam with a master plan that includes mixed industrial, residential and commercial property uses for long-term sustainability. An interchange to Ottawa Flats is also in the pipeline.
Deighton says the region will also bring on-stream a host of residential options, spanning luxury low-density investments suited to wealthy international and local investors to the medium and high-density developments for the more affordable market sector.
Article by: Nicola Jenvey - www.businessday.co.za