The value of industrial land increased throughout South Africa in 2014, particularly in the Gauteng areas of Johannesburg North and on the East Rand. These increasing market values would indicate an increase in rental prices. However, weaknesses in manufacturing, retail and the uncertainty over Eskom’s ability to meet power demand have actually resulted in downward pressure on demand which has impacted pricing.
In Gauteng, there is an attractive industrial land pipeline in terms of greenfield industrial developments. If you’re a corporate looking for a tailored warehouse or factory facility, you have the luxury of choice both in terms of location and in terms of your desired occupancy structure to be, i.e. whether you want to lease or own.
To see a selection of our industrial properties in Gauteng, browse our four segments below:
Pricing for these industrial developments is determined by two main factors:
- locality i.e. access to major transport networks
- developer’s costs associated with rezoning and servicing the various land pockets. The majority of greenfield development opportunities can be found in secure business campuses or parks where the costs of security, access control, and general maintenance can be pooled across various tenants/owners.
The road corridor between Durban and Johannesburg continues to support the vast majority of freight supply into Gauteng. Transnet are busy with significant infrastructure upgrades which should see an increasing shift from road to rail solutions. Hopefully this transition will reduce current congestion pressures on Gauteng’s highway and major arterial road systems.
Property developers are cognisant of the investment into rail infrastructure and, where possible, are making provision for rail access on new projects. Rail will hopefully become a more economical mode of freight transportation. A reduction in transport costs will hopefully ease commodity pricing and offer some respite to consumers. Increasingly, corporates are using supply chain consultancies to complete ‘centre of gravity’ studies ensuring that their locality is in line with their customer, staff and operational thresholds.
If you have any queries relating to industrial land procurement or are considering a tailormade warehouse or factory facility, contact Simon Black on 083 261 2861.