Sandton Wynberg

broll.com

TO LET GLA: 65m² | R55 per m² Web Ref: GT-JHB-WYNB-2LD4-3CO1

GLA 65m² 65 m² industrial to let in Wynberg - GP Gross Monthly Rental R3,575 Lease Period Negotiable Workshop with storage available immediately Well located property in Wynberg, good highway access. Warehouse unit comes with office and can be used as showrooms. Available From Immediately Finding the right industrial property or space often involves a combination of complex Zoning Industrial technical considerations which include electricity supply, access to distribution hubs, airports and rail links, turning circles for large vehicles, load-bearing floors and roller shutter doors and high eaves among others. All have to be taken into account and finding the property with the perfect combination of elements can get very complicated. Save time and let the Broll team of industrial experts find the right property for you.

Braydon Aab

Office Number: (+27) 11 441 4108 Cell: +27 82 603 3942 Email: [email protected]

All rentals / prices quoted exclude V.A.T

Office Market Report CBD,

May 2019

Broll Insight

Security Accessibility The Sandton Central Management District monitors Sandton CBD is easily accessible via Grayston Drive off aspects related to safety, security and hygiene, with the and via main arterials such as William Nicol private security and boomed controlled access to most Drive and Rivonia Road. Even though the node is prone office buildings in the area. to traffic congestion during peak times, some of this congestion may be alleviated in the future as a result of Availability of Space the continued improvement in infrastructure and the As at Q1:2019, the Sandton and environs recorded an synchronisation of robots along with the well- overall vacancy rate of 17.6%, up from 16.8% in established public transport system which is offered Q4:2018. P-grade, making up the largest amount of within the Sandton area, inclusive of the Gautrain total stock, recorded the lowest vacancy of 10.1%. A- Station and bus feeder routes. grade space recorded a vacancy rate of 20.4%, while B- grade, which makes up the least amount of total stock, Aesthetic Appeal recorded the highest vacancy rate within the node of P-grade and A-grade stock is modern and well- 32.9%. maintained with high-end finishes. Highlights Affordability P-grade: R235 – R265/m²/month gross achieved Trends A-grade: R150 – R200/m²/month gross achieved • Energy efficiency and modern design continue to B-grade: R100 – R150/m²/month gross achieved be a trend in the Sandton office market with tenants showing increased interest in spaces with Amenities Green Star ratings. • Rent free periods and tenant installation allowance The node offers a wide variety of amenities that (TIA) incentives continue to be common practice. include, but are not limited to, hospitality, conference Previously, landlords only offered these incentives facilities, convenience services and retail amenities on A- and B-grade stock, however, these incentives such as the super-regional Sandton City. have recently been offered on certain P-grade

spaces too. Alice Lane • Rental pressure is expected to continue for older buildings as a result of decreased demand as well as the rise of new, recently completed developments. • The ever-growing trend towards the live-work-play concept continues to be seen in the Sandton node with the likes of Sandton Summit, a mixed-use precinct combining residential, hospitality, offices and retail uses, parts of which have already been

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completed while others are in the construction within the node include the likes of the and/or planning phases. Stock Exchange, EY, Webber Wentzel, Norton Rose, • Serviced office space is growing in popularity within Discovery, Werksmans, Old Mutual and Bowmans Sandton with an increased number of service among others providers now available.

Take-up • Take-up was slow in the first quarter of 2019 as a number of tenants placed relocation decisions on hold until post national elections. The national elections took place this month (May 2019) and the effects on relocation decisions are yet to be seen. • Buildings that are more efficient and have substantial amenities located within the building itself or in close proximity still tend to be taken-up 96 Rivonia faster.

• Landlord BEE accreditation has also proven to be an important part of a tenant’s decision with regards Market Overview to building choice; it is becoming a material consideration when deciding on premises’ Sandton is a mixed-use node, offering premier office relocation. space, retail amenities as well as affluent residential • Demand for space within the Sandton CBD has properties inclusive of free-standing homes, medium- been positive; however, in terms of unit sizes in rise townhouses and high-rise apartments. demand, there has been a noticeable increase in tenants requiring smaller spaces, or looking at Ease of access via main arterials and a well-established downsizing in an attempt to reduce overheads. public transport system, inclusive of the Gautrain along • Due to the abundance of available stock, deals are with bus feeder routes, are evident within the node. taking longer to conclude as tenants are more The Gautrain has a station adjacent to Sandton City, cautious, comparing buildings on offer. Often connecting the node to O.R. Tambo International tenants opt to remain in their current premises as Airport as well as to the greater Johannesburg and a result of relocation costs; however, incentives areas. The success of the Gautrain has had a offered by landlords of newer buildings can lead to significant effect on the Sandton CBD, with the majority relocations taking place. of demand being for offices located within walking • Landlords are finding it difficult to compete in an distance of the station and Sandton City. Furthermore, oversaturated market. the likes of the Gautrain and other forms of public transport, along with the synchronisation of robots, Tenants may assist in alleviating the traffic congestion within the Sandton area which is evident during peak times. Sandton is home to South Africa’s top investment

banks, financial consultants and legal firms. Tenants

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The Sandton office node is largely made up of P-grade 2019 and is now common among most landlords, in buildings (48.8% of total stock), with several older certain instances P-grade landlords have also been buildings having been redeveloped in order to create offering these types of incentives. more A-grade spaces which account of around 33.8% of total stock. B-grade spaces, which record minimal Additionally, increased pressure on office vacancies has demand, only comprise 17.5% of the nodes stock. Even been evident since the introduction of serviced offices though demand for space continues to be positive, the in South Africa and Sandton specifically. According to size of units in demand has declined. The majority of InstantOffices, a serviced office is a furnished and fully- demand is for P-grade offices with Green Star ratings equipped pay-as-you-use office space, located in a (energy efficiencies), although demand from smaller building managed by an operator. Operators will rent users for sectional title offices has recently become out single serviced offices or whole floors to their evident. Furthermore, a move towards flexible work clients, giving them access to ready-to-use office space space which includes hot desking and open-plan work on flexible terms. The number of serviced office space space continues to be noted. This trend is particularly providers is growing on a monthly basis, making it evident with international tenants and has also being somewhat difficult to keep count of how many there adopted by some local businesses. are exactly. However, there are currently 9 notable serviced office space operators within the Sandton CBD The bulk of the existing vacant stock in the market in occupying roughly 12,000m² collectively, with an the form of A-grade and B-grade buildings started additional operator opening towards the end of 2019 becoming available from the end of 2017 and beginning adding around 8,000m² of serviced office space to the of 2018. This was primarily as a result of tenant market. This in comparison to 2017 when there were relocations to newer buildings within the Sandton node only 3 notable serviced office space providers which offer better amenities, efficiencies and occupying approximately 6,000m². The densities incentives. Which has in turn lead to landlords of older (person/m²) in these types of offices are much higher buildings struggling to retain existing tenants in certain than in traditional office spaces, i.e. roughly 1 instances with pressure on rentals increasing as these person/5m² - 7m² vs 1 person/10m² - 15m², this poses buildings remain vacant for extended periods of time. a threat to traditional office space and the current Towards the end of 2017 certain landlords of A-grade vacancy levels in Sandton. A few reasons as to why buildings began introducing incentives such as rent-free tenants are attracted to these serviced offices include periods or the equivalent in TIA, this trend continues in the likes of:

Grayston Office Park

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1. Flexibility: tenants can sign month to month leases is however anticipated to be negatively affected by thus avoiding being locked into lengthy leases. these types of offices. 2. No capex is required for furniture and fit-out: rental for this type of space is inclusive of furniture, P-grade offices in Sandton are marketed up to telephony and connectivity. R265/m²/month, achieving anything from 3. Less management: rental also includes a R235/m²/month upward. While A-grade space achieves receptionist, internet, security, cleaning and rentals of between R150/m²/month to management for the office space allowing the R200/m²/month, depending on building features. tenant to focus on their core business. Parking bays within the node achieve rentals of 4. Pay per desk: tenants pay per desk and pay for use between R900/bay/month to R1,350/bay/month. of meeting rooms as most of larger meeting rooms Although, there has been a noticeable decline in the are only used once a week, tenants are no longer demand for parking in recent years with the ratio of paying for redundant space. bays/m² having declined. This has been attributed to 5. One fully inclusive rental payment: previously the public transport available within the node. tenants would be liable to pay for aspects such as security, cleaning, insurance, utilities, etc. however, Grade Overview with serviced office space, one rental amount is payable which covers all of the aforementioned P-grade A-grade B-grade aspects, thus allows the tenant the ability to budget Space in Demand 1,000 – 500 – 150 – more efficiently. (m²) 2,000 800 500 Gross Asking Rent 235 – 150 – 100 – In a South African context, serviced office space does (R/m²/month) 265 200 150 not work for all tenants just yet; with the most viable Gross Achieved 235 – 150 – 100 – composition being +- 20 desks. That being said, globally Rent (R/m²/month) 265 200 150 there are large occupiers that have moved big Rent Escalation (%) 8% 8% 8% corporates into these serviced centres. Companies such Typical Lease 5 5 3 as Facebook and HSBC have given their buildings to Period (years) such serviced office operators. This is still a relatively new concept for SA and how it will affect the property market remains to be seen, Sandton CBD’s vacancy rate

155 West

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Construction Activity a conference centre, restaurants, offices A number of office developments were completed (>5,000m²), and more. Once completed, it will be towards the end of 2018 while three buildings were still the tallest building in Sandton, exceeding 180 under construction as at Q1:2019 namely Katherine metres. Towers (Bidvest Bank), The Leonardo and 2 Pybus. • Katherine Towers - a 21,000m² development Major refurbishments have been evident at 16 situated along Katherine Street will be Bidvest Fredman and 155 West that were completed at the end Bank’s new head office with additional space of 2018 and beginning 2019 respectively. Both available to let. refurbishments resulted in premium office offerings. Additionally, there has also been a conversion at 25 Concluding Remarks Fredman from offices to residential apartments. These units have been both sold to investors and owner occupiers alike while also being available to let, The Sandton node and surrounds continue to be South completion of this residential conversion is expected Africa’s premier office location and is anticipated to towards the end of 2019. grow cautiously and steadily. The increase in supply

seen over the last few years is envisioned to slow down P-grade buildings which are under construction or as a result of the oversupply of stock which is currently nearing completion include: evident placing increased pressure on rentals. Serviced

office space is fairly new to the market and its impact • 2 Pybus Road - a new development that comprises on traditional office space is yet to be seen. Developers 14,000m² of office space, located within walking have started thinking differently in order to find distance of Sandton City and the Gautrain Station. alternative uses for the remaining vacant A-grade • The Leonardo - a mixed-use building with 55 floors buildings and new mixed-use developments such as comprising residential apartments and penthouses, Sandton Summit seem to be the trend going forward.

Disclaimer Broll Property Group (PTY) Ltd has taken every care in the preparation of this report. The sources of information used are believed to be accurate and reliable, but no guarantee of accuracy or completeness can be given. Neither Broll Property Group, nor any director, representative or employee of Broll Property Group, accepts liability for any direct or consequential loss arising from the use of this document or its content. The information and opinions contained in this report are subject to change without notice. No part or parts of this report may be stored in a retrieval system or reproduced or transmitted in any form or by any means, electronic, mechanical, reprographic, recording or otherwise, now known or to be devised, without prior consent from Broll Property Group.

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Sandton CBD, Gauteng Listings

Alice Lane Building 3 155 West 165 West Gross Asking Rent Gross Asking Rent Gross Asking Rent R235 R165 R137.5 (R/m²/month) (R/m²/month) (R/m²/month) Size of units Various ranging Size of units Various ranging Size of units Various ranging from 150m² - from 100m² - from 100m² - available (m²) 1,000m² available (m²) 20,000m² available (m²) 2,000m² Lease Period Lease Period Lease Period 36/60 36/60 36/60 (months) (months) (months)

Availability Immediately Availability Immediately Availability Immediately

Grayston Office Park 96 Rivonia 4 Sandown Gross Asking Rent Gross Asking Rent Gross Asking Rent R130 R265 R165 (R/m²/month) (R/m²/month) (R/m²/month) Size of units Various ranging Size of units Various ranging Size of units Various ranging from 100m² - from 300m² - from 300m² - available (m²) 2,000m² available (m²) 8,500m² available (m²) 4,000m² Lease Period Lease Period Lease Period 36/60 36/60 36/60 (months) (months) (months)

Availability Immediately Availability Immediately Availability Immediately

Click here for further listings in Sandton CBD

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Intel Report Contact Details

Divisional Director Head of Commercial Broking - Area Specialist Broll Property Intel Gauteng Matthew Crawford Elaine Wilson Rodney Luntz +27 11 441 4824 +27 11 441 4083 +27 11 441 4715 +27 83 460 8201 [email protected] +27 82 416 0874 [email protected] [email protected] Researcher Daniella Martino +27 11 441 4075 [email protected]

Head Office and Country Contact Details

Broll Property Group (Head Office) Broll Kenya Broll Nigeria Broll South Africa Physical address: Westlands Business Park, Physical address: 6th Floor, ED Building, Physical address: 61 Katherine Street, Acacia Block, Ground Floor, Waiyaki Way, 47 Marina, Lagos Island, Lagos Sandown Ext. 54, Johannesburg Nairobi Phone: +234 1 270 1890 Phone: +27 11 441 4000 Phone: +254 712 668 448 Email: [email protected] Email: [email protected] Email: [email protected] Website: www.broll.com.ng Website: www.broll.com Website: www.broll.co.ke Broll Uganda Broll Botswana Broll Mozambique Physical address: The Acacia Mall, 4th Floor, Physical address: 1st Floor, The Hub, Physical address: Rua Mateus, Sansao Plot 14-18 Cooper Road, Kampala iTowers, Gaborone Muthemba, Maputo Phone: +256 312 531 500 Phone: +267 398 1973 Phone: +258 21 496 852 Email: [email protected] Email: [email protected] Broll Zambia Website: www.broll.co.mz Broll Ghana Physical address: Manda Hill Mall, Cnr Great East Physical address: 7th Floor, Ridge Tower, and Manchinchi Roads, Lusaka 6th Avenue, Ridge, Accra Broll Namibia Phone: +260 21 125 5550 Phone: +233 302 672 888 Physical address: Zanlumor Building, Email: [email protected] Email: [email protected] 2nd Floor, Post Street Mall, Windhoek Website: www.broll.co.zm Website: www.brollghana.com Phone: +264 6 137 4500 Email: [email protected] Broll Indian Ocean (Madagascar, Mauritius, Website: www.brollnamibia.com.na Seychelles & Réunion) Physical address: Unit 3, 6th Floor, Barclays House, Cybercity, Ebène, Mauritius Phone: +230 468 1222 Email: [email protected] Website: www.broll-io.com

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