Economic miracle needed to save office sector
Vacancy factor has persisted for nearly a decade, but nearly 105,000m² of offices will hit the market in the next two years
The office market will turn the corner only when the economy starts growing at 3%, an accomplishment last achieved in 2011, an analyst says. Offices have been the worst performer among traditional property types, including retail and industrial, for a number of years as they struggle to shake off a stubborn vacancy rate of about 11%. New York-listed MSCI’s IPD property statistics have retail vacancies around 4% and industrial vacancies at about 3%. Craig Smith, head of research and property at Anchor Stockbrokers, said most new office space over the next two years would be new-builds in premium nodes. Anchor Stockbrokers is a wholly owned subsidiary of the JSE-listed wealth manager, Anchor Group, which has a market capitalisation of about R708m and assets under management of about R36bn. A transaction, which will see a consortium led by property developer Sisa Ngebulana buy a 51% stake in Anchor Stockbrokers, is expected to be completed in early 2019. Offices are largely driven by e...
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