Golden Opportunities for Smart Commercial Property Investors
The commercial property market by far the sector hit hardest by the Covid pandemic worldwide. Nevertheless, where others see problems we see potential, and for value investors – there are good opportunities to be had. Remember that every market, including property, has a cycle, and best opportunities are to be had when opportunities are priced at their lowest. Commercial Exchange has picked some key opportunities available at this time.
Two areas feature strongly as key in every property professional forecast – they include residential development, particularly for entry-level homeowners, or low-income tenants as well as additional housing to accommodate semigration to coastal regions and industrial. Logistics and warehousing, in particular, are expected to experience good demand, partially due to the growth of e-commerce particularly in areas with good proximity to airports, ports and railways and partially due to a local manufacturing shift in approach. We’ve identified the following key properties for this market and in keeping with our profile.
Inner City Johannesburg CBD turnkey solution at R 300 000 p/opportunity in Ellis Park.
No matter how much development happens in the Inner City, the demand for housing at entry-level remains cannot be satisfied. This excellent turnkey project is available in the Ellis Park precinct. With a total of 324 units with rentals from R 3000 to R 4 500, this is a great opportunity to get into the market without having to go through the process of developing and designing. This property will be fully developed according to specs and gives prime access to this market. Currently, property owners in the Inner City at the entry-level rentals are experiencing less than a 3% vacancy, with very little difficulty evicting non-paying tenants and few administrative hassles as sometimes experienced in the more upmarket areas.
Turnkey solution at R 85 Million in Goodwood (CPT).
Student accommodation is in high demand in Inner City areas. This turnkey project is available in the Elsies River/Goodwood precinct. With a total of 100 units over 4 floors and a retail floor with a projected retail income of R850,000 pm, this is a great opportunity to enter the market without having to go through the process of developing and designing. Construction is underway and this is projected to be completed by end December 2020. This property may also be leased at R600,000 p/m plus estimated R50,000 p/m for services.
Residential development land in Simon’s Town, Western Cape
The Western Cape, particularly Cape Town and areas within a 40-minute drive, is by far the most attractive part of South Africa – with local and international interest. Land between the ocean and the mountain is rare – and zoning can be tricky. This excellent development site is nestled against the mountain and overlooks the ocean in Simons Town, South Africa’s oldest naval port. 5 400 sqm, re-zoned to GR2 with an SDP for 78 units (not yet submitted) and Heritage approval already screened. Serious offers from R12,5 million considered.
Further inland, in beautiful Paarl, a block of 13 offices plus 2 large storerooms plus 4 basement parking bays for sale (total of 1343 m2) of tenanted office space. Rental is R175 000 p/m guaranteed for 12 months. (net yield of 10.6%). Asking R15 million.
Next, we move to Ethekwini and a potential industrial development site in Cato Ridge, adjacent to the proposed inland port development in Cato Ridge. This is a back-of-port facility that will contribute to decongestion at the Port of Durban and within the Durban CBD thereby creating additional capacity for the Port of Durban. The facility will be an integrated logistic hub with associated value-added services. This includes the development of four core projects namely Truck Stop and Staging, Inland Port & Intermodal Terminal, Logistics and Industrial Parks, Tanks Farm and Pipeline with a total investment of R20-billion. The opportunity is an adjacent site measuring 513 hectares in extent, located in the hub of Cato Ridge with easy access to service and industry, with great access and visibility and with potential railway access. Geo Tech & Services Report, Environmental, Wetland & Heritage studies available to prospective buyers. Asking R200 million.
Closer to home, in the Hub of the Lanseria Mega City project and adjacent to the proposed Gautrain, we bring you Malibongwe Industrial Park. Located along Malibongwe Drive, near the N14 Intersection, we offer 8 commercial stands of various extents available for development at R850/m2. Turnkey or lease options are also available.