Although new industrial developments are taking place throughout South Africa, Coega Industrial Development Zone (IDZ) is seen as the country’s largest integrated industrial and commercial property development, according to the South African Property Owners Association (Sapoa) report 2005/06.

Allan Zeiss, the estate and facility manager at Coega Development Corporation (CDC), says opportunities have been created in the Coega Industrial Development Zone (IDZ) for partnerships with private property developers.

“ A number of Coega investors are looking for factories, warehouses and office spaces to rent,” says Zeiss.

According to the report, the industrial property sector is currently the star performer in the property sector.

The report emphasises that vacancies are low and will decrease even further as manufacturing volumes have increased by about 4% since the last quarter of 2004.

Also, the report says potential tenants at Coega IDZ include manufacturers of high end and niche textiles, fabricators, warehouse and logistic operators including: agri-food processors- many of which give opportunities for industrial and commercial property investors to provide factory and office space.

“ Coega is where the biggest property opportunities are at present in South Africa, and that the environmental approval has already been obtained,” the report argued.

Zeiss says the opportunities are beginning to materialise at Coega. “ The demand for multi-use factory space has come from a number of investors who were looking for relatively small space to let,” says Zeiss.

Zeiss urges property developers to set up syndicates, which could raise the funds needed to build the developments for which the CDC has investors.

“ We are currently building-up a database of people interested in investing in property at Coega IDZ. Coega is one of the only places in the world with land, Infrastructure, a deep-water port, and low energy costs,” Zeiss argued.

Also, Zeiss says IDC has received a lot of enquiries from institutional investors showing interest in the opportunities being created by Coega.

According to the report, the Western Cape’s industrial markets are exploding, and this has resulted in a shortage of land available for development. “Land prices have increased and in some cases land is sold for more than R500 a square metre. New developments are sold as soon as they become available”.

Prof Francois Viruly, independent property economist, argued that although industrial developments countrywide are accelerating, the industry needs to promote different economic clusters to avoid being overly competitive to each other in future.

According to Viruly, the industry needs to compete appropriately for the market, and strife to find their own specific investments at market related rates.