JLL, one of the world’s leading real estate investment and advisory firms, today released its Q1 South Africa Real Estate Market Performance report which outlines the implications that Covid-19 will have on major sectors across the country.

According to the report, most real estate sectors across the market have softened with the exception of the industrial sector, which has recorded a strong performance in Q1 2020.

Industrial property continues to look positive

Adapted from an article by eProperty News

As travel restrictions, the closing of non-essential businesses, and mass cancellations of events has significantly slowed economic activity in South Africa, traditional retail, heavy industry and the hospitality sector have been hit the hardest. The International Monetary Fund (IMF) anticipates the effects of Covid-19 will force the global economy to contract by 3% in 2020, whilst emerging markets are expected to contract by 1%.

Emerging economies are anticipated to bounce back stronger than leading economies, with GDP predicted to grow between 4% and 6% in 2021. Although Covid-19 will have significant impacts on the global economy over the short to medium term, long-term structural shifts may be less severe.

“Whilst some of the more resilient leading economies have been able to stabilize amidst the global pandemic, many emerging markets have been adversely impacted by compromised global supply chains and South Africa is no exception,” said Michael Scott, Research Analyst, JLL, Sub-Saharan. “With slowed economic growth and rising debt obligations, South Africa’s debt to Gross Domestic Product (GDP) ratio is expected to reach 70% by the end of the year, so the implications on local businesses is significant. Many are going to be forced to scale down and reduce spending.”

Good news for industrial property

The Industrial sector space remains strong, with year-on-year capital growth backed by low vacancy rates (3.4% national average). There is now a growing demand for warehouse and distribution space due to the significant growth in online retail sales from a relatively low base. E-commerce is expected to strengthen as consumer preference and behaviors change, with increased market penetration as a result of more accessible and affordable technologies.

Ballito – Capital of KZN’s North Coast

North Point Ballito is situated in the heart of the Northern Urban Development Corridor, one of Africa’s fastest growing commercial and residential centres and a significant concentration of wealth on the continent. Ballito’s proximity to King Shaka International Airport, a key driver of the new economic growth, has positioned the town as the unofficial capital of the North Coast.

Designed for doing business tomorrow

North Point Ballito is one of the few commercial sites situated within Ballito’s town limits, providing investors in the estate with a captive audience of affluent residents and tourists. With flexible zoning and a master planned approach to the design of the space, North Point Ballito offers a secure, easily accessible and architecturally consistent business environment, with serviced platforms to suit businesses of almost any size and concept.

Local or global, North Point Ballito is positioned for success

Located between the R102 and N2 at the Shaka’s Head interchange, North Point Ballito offers immediate access to major roadways that offer access to Durban Harbour, Richards Bay and the KZN interior. With a large pool of skilled talent within the immediate surrounding areas and three global gateways into Africa only minutes in every direction, the estate offers astute businesses in the technology, trade and logistics industries a tactical position that will be a key competitive advantage in future.

Every so often an event comes along that turns the world on its head. In these times of uncertainty, commercial property investment is the last thing most of us are thinking about. But maybe it shouldn’t be?

The COVID-19 pandemic, like 9/11, is one of those events that feel like they split time in two: the world before coronavirus and the world after coronavirus.

By all accounts, there are some difficult months ahead. Things are probably going to get worse before they get better. But the South African government’s response has attracted international approval, and chances are brighter times aren’t too far off. If the past is a window to the future, there’s one thing we can all be certain of: South Africans will defy the odds and get people back together again, no matter how big the challenges seem. The opportunity for companies to contribute to that effort is emerging as we speak.

Vasbyt in the age of Coronavirus

The question we all need to be asking is ‘what does the future look like, and how do I make the most of right now?’ Here’s four trends that are going to shape the post-lockdown economy, and how North Point Ballito might be the ideal position for your business idea:

Community Focused Logistics

The supply chain will need to shift quickly to become more streamlined and more automated. With more shopping happening online and over the phone, fulfilment centres close to consumers will be an essential part of meeting future needs. North Point Ballito is right on Ballito’s doorstep – an ideal location to serve one of Africa’s fastest growing and most affluent communities.

Storage

Disruption leads to human movement. Downsizing, emigrating, holding possessions in place for some time – this will undoubtedly be part of the tomorrow economy. North Point Ballito is landscaped, greenscaped with indigenous plantation, branded and architecturally consistent. That makes for an ideal backdrop to a storage concept that people and businesses in Ballito are going to trust.

Cleaning

Epidemiologists generally agree that COVID-19 will be with us for some time. It will be up to governments and the market to keep outbreaks under control until a vaccine can be introduced, or until gradual immunity builds. That means cleaner workplaces, shopping venues, restaurants, factories, warehouses and schools. Got any bright ideas?

Technology

If social isolation has proven anything, it’s that social interaction is critical. Workers and students need collaboration. Kids need playtime. Technology companies are already stepping into the gap, whether by making spaces safe for people, breaking down the barriers around socialising remotely or providing the the information people need.

Building has officially begun on North Point Ballito, a 380,000 square meter mixed-use commercial estate located just opposite Ballito’s New Town Centre at the Shaka’s Head interchange. A ground-breaking ceremony was held at the site to commemorate the milestone.

North Point Ballito addresses the rising demand for quality commercial floor space on the Dolphin Coast. North Point Ballito will provide businesses in the tech, trade and logistics sectors with key advantages. From the outstanding location on the N2 and R102, the estate offers easy access to King Shaka International Airport and the harbours of Durban and Richards Bay.

North Point Ballito comprises 51 serviced sites on a secure, landscaped and architecturally-themed business estate. With few zoning restrictions, North Point Ballito can accommodate enterprises of almost any size and industry, including workshops, restaurants, places of entertainment, manufacturing and warehousing, among many others. Fourteen hectares of North Point Ballito is green and indigenous space connected by walkways, with parks and pedestrian landscaping and ClearVu fencing throughout.

“North Point Ballito has drawn a lot of attention because of the superb tactical advantages that our development offers,” said James Hesse, Cenprop’s project director, “From start-ups to major established enterprises, North Point offers businesses big and small with a space to thrive. Our early investors understand the value that the right address delivers.”

With recently upgraded roadways and electrical distribution via the new Imbonini substation, North Point Ballito offers a secure, landscaped and architecturally designed environment conducive to business. Each site offers comes serviced with municipal water and sewage, reticulated fibre optic internet and three phase power, and it platformed and graded.

The north urban development corridor is one of the fastest growing wealth concentrations on the continent. It has seen considerable growth as a result of the new international airport, Dube Tradeport and Cornubia developments, and the depth of the labour and skill pools within the immediate surroundings. Ideally situated within Ballito itself, North Point Ballito will serve one of the country’s most dynamic and affluent communities.

It’s no coincidence that Ballito is both KZN’s number one tourism destination and the province’s fastest growing town. Schools, hospitals, lifestyle estates, dining, entertainment and idyllic beaches in every direction puts the town in a class of its own.

For investment enquiries, contact James Hesse at 082 921 0044 or complete the form below.

If you’re looking to maximise your return on investment, is it better to lease, buy or build, and is now the right time?

It’s a big question with far reaching implications for any company. The best advice is to do the research. Look at the market, consider the position your company is in, and make the decision that makes the most sense for the moment. For many types of companies, there are significant advantages to developing a build-to-suit business property on vacant land than buying a property ready-built.

Studies have shown that companies that operate from premises that they designed and built themselves are more efficient, more profitable and more likely to retain key staff than companies that do not. It comes down to that core driver of value: realizing vision. Although buying something ready-built has the benefit of immediacy, the enterprises that are willing to play the longer game reap the bigger rewards. Why is that? Here’s what the study found:

The benefits of building your own commercial premises

1. Designing the space yourself shapes how you operate 

Hands-on development of the layout and workflow of your own premises forces decision makers to consider new perspectives and new possibilities. When you retrofit a built space, there’s a greater tendency to go about business as usual, without the added innovation.

2. A premium location costs significantly more to purchase ready-built

When the premises are already built, you pay a considerable premium for an optimal address. Vacant sites in emerging areas offer considerably more room for appreciation, adding to company valuation and the bottom line. 

3. Too much space or too little

Buying ready-built means having to compromise in any number of ways. Does one take the bigger place out of town or the slightly more cramped option closer to the customer? With vacant sites, the size of the platform is far less restricting.

4. Appreciating asset

Owning your commercial building offers the benefit of capital appreciation, the rise in your property’s value over time. On average, building on vacant land is more likely to accrue value more quickly than a ready built property.

5. Taking a longer view 

Companies that build take a more measured view of the potential of the area, the asset growth and the over-arching implications of their investment than companies that do not. The insights uncovered through the build process contribute to other areas of the business.

A location second to none

North Point Ballito has 52 sites perfectly positioned for future-thinking companies in the Trade, Tech and Logistics sectors. North Point Ballito is situated only 15 minutes from King Shaka International Airport, 40 minutes from Africa’s busiest port and 90 minutes from Richards Bay.

Safe, secure, clean and green, North Point Ballito is where business is moving. If you have a business idea, why not give James a call on 082 921 0044 or email james@cenpropdev.co.za. Even if it’s not the idea for right now, our lines are always open. We love talking business.