Construction and property development Construction is on the rise in the Western Cape.
SECTOR INSIGHT 3 000 housing units are planned for the old Conradie Hospital site. • Two new estates have been built in George.
ommercial and residential development plans totalling 654 000m² were approved in the Western Cape in 2015, a 14% rise over the previous year and a figure almost nine times greater than that for the province of Gauteng. The construction sector has grown steadily over the past several years and is expected to be the fastest-growing sector in the next five years, especially in the City of Cape Town. Infrastructure spending and residential developments are the key drivers in this trend (Western Cape Treasury). The hotel-led construction boom in the central business district of the City of Cape Town is the subject of a separate article elsewhere in this publication. A large hotel and conference centre development was opened in early 2016 at Century City. House prices in Cape Town are moving upwards faster than anywhere else in the country, both in terms of inflation (10.35% vs 5.59%, Lighthouse) and average house prices (11.89% vs 5.6%, Pam Golding). A six-bedroomed Clifton house sold for a record R90-million in November 2016. The economic development department of the City of Cape Town has done a survey of 23 of the city’s industrial areas, designed to help WESTERN CAPE BUSINESS 2017
the decision-making process for investors and businesses wanting to expand. The report found that there were 7 229 businesses in the 23 areas and that industrial property was concentrated in two areas: Voortrekker Road and the metropolitan south-east including the airport precinct, Epping and Philippi. The CBD hosts 39% of office space in Cape Town, with Bellville/Tygerberg accounting for 25%. The fairly new development at Century City has already secured 12% of office accommodation with the established suburb of Pinelands (which houses a huge Old Mutual office) responsible for 11%. The first Western Capespecific real estate investment trus t (REI T ) lis te d on the stock exchange in November 2016. Spear Reit’s R1.5-billion portfolio comprises mostly industrial property (46%) with retail and office space each making up 22%.