'Still lots of buyers' for the sale that has been dominated by retail buildings in small towns.

Friday, 29 August 2008 02:00

Old and new buildings on offer

 

Morden office and retail buildings, as well as an historical hotel building in Gauteng and Mpumalanga, will be on offer at the Alliance Group multi- property auction next month.

The success of the Lagos Palms - a pioneering retail venture, which in 2006, provided Nigerians with their first 21st century shopping and entertainment experience - has prompted plans for a further $220 million extension including a waterway transportation option

Listed and commercial property sector is expected to achieve 15% in total return in the next two to three years, with income growth seen at 7.5% over the same period, an investment consultant said today.

Thursday, 13 December 2007 02:00

Nedbank clinches Irene project deal

Nedbank Corporate Property Finance’s Gauteng division has acquired an effective one-third interest in a proposed multibillion-rand mixed-use development in Irene

Diepsloot Mall, the new shopping mall in Diepsloot near Fourways, has commenced trading

Leading listed retail property fund Hyprop Investments has expanded its investment portfolio with the acquisition of approximately 31,3% of listed property unit trust Sycom Property Fund (“Sycom”) for R1,24 billion

Building material costs have risen sharply again in the second quarter of 2007 — industry experts said demand for commercial space was outstripping supply — and developers are having difficulty bringing new projects on stream.

Construction IndustryBuilding costs in the second quarter of 2007 rose by 29%. The index reflects the average building cost per square metre priced by building contractors.

It contains a combination of input costs and pricing which varies due to market conditions.

Retail property showed an increase in building costs of 39.5% in the second quarter — the latest available figures; office space by 26.2% and industrial space 13.9%.

Large construction companies are operating at full capacity with the World Cup stadiums, the Gautrain and the Coega development zone taking up all their activities. Some impact from higher interest rates is also filtering through and a shortage of materials is likely to continue for some years.

While the cost of materials is rising — cement is now being imported — contractors and service providers are increasing their rates at well above inflation levels and there is likely to be renewed pressure on building costs.

“With costs escalating at present rates, rentals for existing properties will be rising as they come up for renewal, said Craig Hallowes, the Association of Property Unit Trusts spokesperson. “We can’t bring a new office block on line in Sandton for under R120/m². Although I don’t think that we are yet at the point where rentals will be running at replacement cost, if the rent is currently R70/m² or R80/m², then I think that you can expect a 20% rise when renegotiation takes place. ”

In the past it would take about 12 months to construct an office block when property was available and rezoning took place quickly, but municipal councils have tightened up on rezoning applications.

In the case of retail developments, a larger number of sub-contractors are being used for items such as glass and aluminium and these specialists are in short supply.

In a twist to the rising building material costs, the Competition Commission has indicated that it will look at the building and construction sectors to assess if there are any anti-competitive practices — as well as bid-rigging, where rival companies decide beforehand which of them will win a tender.

 

Nedbank Corporate Property Finance has provided R190 million funding for the revitalisation of the Hatfield metropolitan node

Wednesday, 22 August 2007 02:00

RMB looks north

RMB Properties’ property development division has initiated developments in some of SA’s neighbouring countries.

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