In the space of fifty years, Sandton, often referred to as ‘Africa’s richest square mile’, has transformed to probably one of the most important business and financial hubs in Southern Africa. Sandton is filled with tourists and locals each day for business, shopping and sightseeing.
Sandton has easy access to Pretoria, it lies 56.6 kilometers away via the N1 motorway, the travel time is as little as 40 minutes away depending on the traffic.
Located between Sandton and Pretoria, also via the N1, approximately 16 kilometers outside of Sandton, lies Midrand, an important industrial area.
Johannesburg Central is also conveniently located near Sandton and is only 20 kilometers away, while the R21 provides easy access to OR Tambo airport which is approximately 30 kilometers away.
It became apparent that the infrastructure could not cope with the extreme pressure of traffic and people, so the Gautrain was built with stations linking Sandton, Rosebank, Pretoria and OR Tambo airport. The supporting road system continues to undergo major upgrades to ensure that traffic flows are eased and pedestrians are safe and happy. Mini-bus taxis are a popular mode of transport, as is the municipal bus system. “Added to this,” says Leon Breytenbach, National Commercial Manager for the Rawson Property Group, “the full Bus Rapid Transit (BRT) system will soon come into operation, alleviating some of the present transport problems and ensuring that Sandton is more accessible than ever before.”
The business hub
“Sandton offers some of the best and most expensive commercial property in the country and boasts top financial institutions and corporations within its boundaries,” explains Breytenbach. Head-offices situated in Sandton include: Nedbank, Rand Merchant Bank, Investec, Alexander Forbes, Discovery, Sasol, and a plethora of top legal firms, including ENSAfrica, Webber Wentzel, Hogan Lovells, and Cliffe Dekker Hofmeyer. The Johannesburg Stock Exchange and the Sandton Convention Centre are also established here. The area boasts several shopping malls including the Sandton City, while the industrial sector is situated on the periphery, in suburbs such as Wynberg, Marlboro and Kramerville, all within an approximate five kilometre radius.
Due to extreme demand for commercial and residential space in the Sandton area, high-rise buildings are becoming the norm. “The current, ongoing redevelopment of the area includes the construction of a 60 storey office tower, a new hotel, new retail and office space, and residential apartments. The Leonardo, a 48 storey mixed-use building is due for completion in 2017,” says Breytenbach.
The commercial property market in Sandton, specifically in office space, brings both a stability and general improvement to surrounding areas. According to the SAPOA report, “Given recent trends in vacancy rates and stable rental levels across most office grades, it would be fair to say that recovery remains on track for now. Future trends depend largely on the strength of growth-drivers, most notably financial and business services, employment growth and capital investment.” However, when all approved construction is completed, if not rented out quickly, it could cause a significant increase in office vacancies. Most of the space is leased off-plan, yet the amount remaining requires a ready market to absorb the surplus space and prevent an initial increase in vacancies.
Facts and figures
SAPOA currently analyses nearly 1.6 million square metres of rentable office space, of which over 565 000 square metres is Prime office space, almost 800 000 is A grade office space; and the remainder is B grade office space. “Of the total rentable space, just under 151 000 is available for rental, consisting predominantly of A grade space,” says Breytenbach. The current vacancy rate as published in the SAPOA report of October 2016 shows a rate of 9.6%, which is slightly improved on the previous 9 months.
The rentals are about R189 per square metre for premium grade office space, R148 for A grade offices and R112 for B grade offices. Currently there is about 346 000 square metres of commercial space approved and under construction, 37 500 of which is available for leasing and will come onto the market in the near future.
Rawson Commercial has offices countrywide and we will gladly assist you with all your commercial needs. Contact (021) 658 7100 or visit www.rawson.co.za for the latest market tips and industry news.