Buildings are some of the biggest emitters of CO², accounting for one-third of global greenhouse gases. Commercial and residential buildings also account for 40% of the world’s energy consumption.

In Johannesburg’s retail, office and industrial markets, and in Cape Town’s office market, commercial tenants are seeking to reduce operating costs in the long term, according to the report.

In the retail market, while the BER Consumer Confidence index has remained below the zero mark over much of the year, sales measured in constant prices, and adjusted for inflation, have managed to maintain a flat upward trend, which bodes well for retailers in the current economic climate, more so in the Johannesburg area.

Clothing and footwear retailers have often outperformed the overall retail market, and have come to dominate activity in retail accommodation.

The report notes that Johannesburg’s office vacancy rate declined to 11.3% in the third quarter of this year, from 12.4% in the third quarter of last year, despite additional supply in the market. Although rental rates remained largely unchanged, Grade P accommodation showed a 5.7% rise in the average rental rate to R202/m², showing strong demand despite the unfavourable economic climate.

Demand for light industrial property in Johannesburg has remained stable in the quarter, with encouraging take-up of space for the use of logistics, distribution and warehousing in prime locations. In the northern and eastern nodes of the city, there has been a large development pipeline of newer and larger logistics units.

The market is expected to remain under pressure in the short to medium term against SA’s economic backdrop.

In the Cape Town office market, investor confidence improved since the first half of the year, with the majority of new developments being speculative. The overall vacancy rate rose slightly to 9%.

Grade A accommodation recorded an average 6.4% yearon-year increase in gross rental rates, with Century City outperforming other nodes.