Demand for Big Box warehousing grows in Gauteng
Big Box warehousing will continue to offer lucrative opportunities
to industrial property investors for the year ahead, according
to leading property group Galetti Knight Frank. Given the
current projected growth in this market in South Africa,
most of the deals concluded are likely to come from consolidation,
as the trend appears to be moving towards more efficient
warehousing, the group says.
Gauteng has seen huge uptake of speculatively built distribution
centres (DCs) over the last 12 to 18 months, with Improvon,
Intaprop and Capital Property Fund staking the biggest claims.
Already, their strategies appear to have paid dividends.
Spec builds by Capital Property Fund in Raceway Park
in Germiston include 11,000sqm DC that secured tenancy
upon completion from the South African Police Services
(SAPS); a 23,000sqm space already let to Montesanto upon
completion; and another 40,000sqm DC for which construction
has just begun. John Jack, Galetti Knight Frank’s
Gauteng Director is confident of securing a tenant before
the keys are in the door.
Jack says, “Efficiency is paramount to this segment
of the industry and new builds such as those currently
going up at Raceway are designed specifically to offer
maximum storage options. That’s why we’re
finding old style warehousing, typically with low roofs
and difficult layout, will experience some vacancy over
new builds. He adds, “Especially with the cost of
refurbishment now nearing that of a brand new building.”
Improvon’s development in Gosforth Park, adjacent
to Raceway, has just been leased to a division of Shoprite.
The 21,000sqm speculative build is set for completion
this month still.
Meanwhile Meadowview Business Park, next door to Longmeadow
and developed by Intaprop, another prime commercial space
that is zoned for industrial warehousing, is seeing leading
Other new builds at the park include a completed 35,000sqm
DC for UTI, and still under construction is a 5,000sqm
build for Esco Corporation, a 10,000sqm build for Premier
Foods and a 20,000sqm build for Gold Leaf. Galetti Knight
Frank’s Justin Thom, who concluded the deal with
Triton maintains the park offers unbelievable value for
those companies looking for prime location in Gauteng.
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