Durban: office rentals stable

2010-10-16 00:00

ALTHOUGH Durban’s retail and office property sector has been plagued by falling rentals and rising vacancy rates, the overall outlook for commercial property is cautiously optimistic, according to the Annual Broll Property Report.

Broll manages a R62 billion property portfolio comprising about 14 000 leases.

The report noted that the acute shortage of office space in the greater Durban area has stabilised somewhat as new projects begin to come online.

Investments have been made in the city’s CBD and the north of Durban has benefited from the establishment of the multibillion rand King Shaka International Airport.

However, Broll noted that there remains a drastic shortage of parking in Durban.

Monthly retail street-front rentals in Durban have plummeted from R400 per square metre in the second quarter of 2008 to R175 per square metre in the second quarter of 2010 — a 56% decline.

Monthly retail shopping-centre rentals in Durban have also plummeted from R500 per square metre in the second quarter of 2008 to R370 per square metre in the second quarter of 2010.

CBD and decentralised office rentals remain stable, while office vacancies in KZN was about 12% in 2009 from 10% a year earlier.

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