Vacant office space makes way for homes

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Pic: CCID
Pic: CCID

Cape Town - The City of Cape Town has the lowest office vacancy rate in the country at 7.2% quarter end, thanks to the conversion of empty office space to much needed residential units.

This is according to a report published by the Central City Improved District (CCID), a non-profit organisation that looks into the economic activities that took place in Central Cape Town in 2015.

INFOGRAPHIC: Cape Town boom town
INFOGRAPHIC:
The future of Cape Town

“Billions of rands have been invested in Cape Town’s CBD,” says Rob Kane, chairperson of the CCID, “both in buildings and infrastructure. As a result, we’ve seen the value of property here rise from R6.127bn around 2005 to well over R24bn in just over a decade, and conservatively this is expected to be well over R32bn within five years.”

Kane says this is a conservative estimate, as the developers have not yet revealed the costs of some developments.

Cape Town’s CBD has also been declared an urban development zone (UDZ) which in turn offers a tax incentive. This means property developers and investors who upgrade existing or build new properties in the city centre qualify for a tax incentive. The tax deduction is based on a special depreciation allowance on investments made in inner city buildings.

Another trend on the rise in Cape Town’s CBD is the concept of office sharing, also known as co-working where freelancers, small business owners and students rent a small area of office space in a larger setup that is conducive to a professional work environment.

This development is beneficial to landlords who particularly want to increase the number of tenants occupying available floor space.

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