Industrial market shows strong growth

Posted On Monday, 27 September 2004 02:00 Published by
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The industrial property market in the Boland, particularly in Stellenbosch and Somerset West, is experiencing strong growth, says Tony Ventouris, licensee of Seeff Boland Commercial.

September 26, 2004

By Graham Norris

Property Editor - The industrial property market in the Boland, particularly in Stellenbosch and Somerset West, is experiencing strong growth, says Tony Ventouris, licensee of Seeff Boland Commercial.

Ventouris, who was recently awarded Seeff's national trophy for the best medium-sized commercial licence in the country, said: "There has been incredible growth and development in the areas that we cover - especially in the industrial sector in Stellenbosch and Somerset West. Our industrial specialist, Louis Boje, says Stellenbosch has run out of industrial land, and this is going to become a major issue in the foreseeable future

In effect this will have a positive upward movement in rentals and investments," said Ventouris.

"Stellenbosch has an agricultural green belt around it, and the areas originally zoned for industrial development have been developed. At the old Corobrik site, Papegaaiberg, where we were selling at R130/m2 initially, resales are now taking place at R230 per m2 - and that is if there is any land available. There is a serious demand for these industrial sites, which accommodate businesses connected with the agricultural, engineering, wine and food industries.

"In addition, numerous wine producers are establishing their wineries in the industrial areas instead of on the farms. This is due to major obstacles that need to be overcome in obtaining the necessary approval and rezoning on the farms for the purpose of setting up wineries there."

Turning to the office market, Ventouris says it is also very buoyant, and one focal point that has really taken off is Techno Park located outside Stellenbosch.

"We have been involved with 70% of the developments in the park. We are achieving office rentals of about R70 per m2 for A-grade offices there. Techno Park, in my opinion, is the best kept secret in the country in terms of location, accessibility and ambience. The views are majestic, you have mountains and vineyards around you. Owners of vacant land have become aware of the growth, and no one will sell for under R500 per m2."


In Somerset West the Interchange Industrial Park, which adjoins the Somerset West Mall just off the N2, has also taken off, says Ventouris.

"This A-grade industrial park is very sought after - we believe it's the address of the future for hi-tech, clean industrial enterprises. Predominantly the owner-occupiers are small to medium-sized businesses - there are no major industries as such, but a lot of businesses affiliated to the motor, agricultural, home-improvement and light-engineering industries are relocating to the Interchange. Prices there have escalated from a low of R160 per m2 for industrial land at the outset to a high of R295 per m2 within a period of two years."

Seeff Commercial Properties has also been involved with developing Stellenbosch's biggest mixed-use development, Bosman's Crossing. The development is an urban revival of the old KWV Industrial Park. Phases 1 and 2, which are predominantly residential, have been sold out, and Ventouris says they will be handing over the first phase, which consists of 48 residential units, to the individual buyers within the next month.

Bosman's Crossing is to be a major tourist destination in the future. The development will offer restaurants, a venue for major wine and food festivals, wineries and food emporiums.

Ventouris is greatly optimistic about the future of the commercial property market in the area.

"If the present market conditions prevail, and if the low interest rates are maintained, then I believe the commercial property market will offer solid investment opportunities, with excellent returns for investors."


Publisher: Cape Argus
Source: Cape Argus

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