There has been a steady increase in investment in the commercial property market since 2014. KwaZulu-Natal has shown stronger investment growth than most other regions in the country, more than doubling investment levels from year-end 2015 to 2016.
Government’s support and commitment to large developments in the greater Durban area, including Cornubia and the Dube TradePort, is anticipated to attract R13 billion alone in private sector investment, and this bodes well for the commercial property sector in Durban.
The commercial property market is set to benefit from the relative economic stability projected for the short to medium-term. Couple this with an increased focus on infrastructure and sectoral development, and Durban promises to be reinvigorated for greater global competitiveness and renewed investor interest.
Durban has experienced a steady increase in growth rates in commercial office space for the past five years, with an uptake of approximately 40 000m² per annum. This is attributed largely to its attractive location, ease of access with residential amenity, and convenient links to Gauteng (under one-hour flying time). The uMhlanga region enjoys many benefits including its key geographical locality between South Africa’s two major harbours and proximity to Dube TradePort.
Hotels & Resorts
The tourism market incorporates both city hotels and coastal resorts. The corporate office nodal growth in uMhlanga and proximity to the airport has resulted in this region being the preferred location for city hotels in Durban. The KwaZulu-Natal provincial government has adopted a tourism master plan with the goal that by 2030, the province will be renowned as Africa’s top beach destination with its unique blend of beautiful weather, wildlife, scenery, and heritage experiences. This bodes well for investment in coastal resorts.
Durban has seen substantial activity in the development of Business Process Outsourcing facilities. Large international operators see considerable opportunity in Durban as a leading BPO destination due to the quality of life, lower costs, accent neutrality and access to large pools of young individuals from which to draw human resource. Tongaat Hulett is collaborating with regional development agencies and the industry body; Business Process Enabling South Africa (BPESA), to further this competitive advantage and drive growth in this Market Sector.
With the proliferation of residential developments in the region, the demand for new educational facilities is intensifying. This includes public and private schools, early childhood development centres, colleges and universities. The introduction of schools to the area is expected to have a positive impact on residential real estate values and there are a number of opportunities available.