Joburg CBD star performer
SPARE A THOUGHT for tenants in London’s West End – the world’s most expensive office location – who now have to cough up the equivalent of more than R1 200/sq m a month for a prime business address. That compares to a rather modest R117/sq m in Sandton, South Africa’s most expensive office location.
International property group Cushman & Wakefield’s 2007 global office report confirms that while SA office rentals are on the rebound, we remain dirt cheap in global terms. Out of 51 countries surveyed, it’s only Thailand and Indonesia where office tenants pay less rent than their SA counterparts (in euro terms).
The report shows that office markets across the globe improved significantly with global office rentals up 12,2% in 2006 (4,3% in 2005).
Pace Property Group MD David Green, Cushman & Wakefield’s associate in SA, says Africa and the Middle East recorded the most buoyant rental growth off all regions in 2006. This comes on the back of lower vacancies and limited supply of new office stock coming on stream.
Interestingly, the Johannesburg CBD was SA’s star performer, recording rental growth of 29% last year. Downtown Joburg was in fact the third best performer in Africa and the Middle East in terms of rental growth, after Abu Dhabi (up 200%) and Kuwait City (up 41%).