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Industrial rentals shine in gloom
Date published 14 November 2008
Lack of suitable industrial land is driving rental growth in many parts of Gauteng, say brokers.
While the residential property market is in the doldrums, owners of industrial properties are cashing in on rentals as lack of stock pushes up prices.
According to the Broll Property Market Report 2008/2009 on industrial rentals, Gaunteng faces a chronic shortage of stock and suitable vacant land for new industrial development.
The report says that industrial rentals are expected to continute rising beyond 2010. In Gauteng, rentals have risen at an average of 15% annually over the past two years with the increase exceeding 25% in 2007.
Industrial properties on the East Rand and in Midrand are charging rentals of R40/m2. Heinrich Smit, a property broker at RCP Brokers, said industrial rentals in Gaunteng varied according to location, and a maximum of R50/m2 had been achieved in some properties. He said preferred areas for industrial properties were Denver in Johannesburg south, Selby, City Deep, Midrand and Jet Park in the East Rand, and tenants included engineering companies, warehouses and manufacturers.
Bruce Fields of Bradford McCormack said there was "demand for warehousing, and distribution properties in the greater East Rand area, mainly on the freeway strip to Centurian in Pretoria". He added that Linbro Business Park and Long Meadow comanded rentals in excess of R50/m2 because of their quality and extras such as the business park environment.
Author: Denise Mhlanga - Citizen
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