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Although it is no longer “business as usual” for the commercial property sector, or for any other sector for that matter, navigating a way through fast changing political, economic, technological and property environments seems to have become a far more complicated task than in the past.
The era of instant news, social media, inclusive developments, transformation and sustainability have thrown so many additional variables into the mix that to consider them all would mean no one would ever make any decisions, says Frank Reardon, Divisional Director, Broll KwaZulu-Natal Broking.
At the recent South African Property Owners Association Annual Convention held in Cape Town last month, discussions were around simplifying and removing unnecessary noise to enable progress.
Despite the challenging economic environment, the property investment sector has untapped opportunities especially for those investors who remain focused on buying good assets in some well sought after locations with good tenants (or tenanting prospects) at fair prices, he says.
Reardon explains that the clamour to diversify out of South African assets has seen more quality assets coming onto to the market for those investors who choose to buy locally. “More recently we have also seen increasing numbers of offshore investment protagonists start to refocus on the South African market.”
Notwithstanding this background, the commercial property investment sector is surprisingly robust. Seldom in the recent past have we seen the number of quality investment opportunities matched by the number of investors willing to make calculated and sometimes large investment commitments, says Reardon.
While investors continue to chase quality properties in good locations, the huge bias toward retail investments appears on the back of a changing retail landscape to have softened in favour of other property types including offices, industrial and residential rental apartments.
“Increasingly, investors appear to be moving away from a sector specific bias towards chasing fundamental value and quality regardless of property type,” he adds.