During the last 12 months, Epping Property has sold 17 Industrial Properties in Cape Town.
Tony Bales of Epping Property explains that “due to the shortage of industrial properties on the market in 2023, Epping Property turned their focus to fulfilling the needs of their clients wanting to purchase industrial properties”.
We set about sourcing industrial properties for sale in the best industrial locations in Cape Town. Our efforts resulted in the conclusion of 17 sales transactions of industrial properties, totalling more than R146,000,000. The sales locations were the central industrial nodes of Cape Town, including Montague Gardens, Brackenfell, and Epping.
Purchasers were both investors and owner-occupiers.
Epping Property prefers to work confidentially and quietly with Sellers and Buyers.
Trends stoking the fire of Demand for Industrial Property
Low vacancy rates of Industrial Property
According to available data, the industrial vacancy rate in Cape Town was less than 5% in 2023.
The average rental rate for industrial properties in Cape Town during that period was R70 per square meter per month, reflecting a 3.3% increase from the previous quarter. Annualised, this amounts to a rise of 13.2%.
High Demand from investors and businesses
Cape Town remains a progressive city with a diverse economy and a well-developed industrial property market.
The demand for industrial properties is driven by e-commerce growth, logistics, and the distribution industries.
The City of Cape Town’s commitment to avoiding electricity crises and overall economic growth further contributes to the demand for industrial spaces.
Stability and Appeal
Despite challenges such as load shedding, a weaker exchange rate, and political uncertainty, the Cape Town industrial property market remains resilient.
Cape Town’s strategic location, well-maintained infrastructure, and stable electricity supply contribute to its appeal for businesses and investors.
Political and Economic Positivity in Cape Town
From late 2024 onwards, interest rate cuts are expected. These rate reductions will benefit landlords by allowing them to recoup cash flow and achieve higher yields.
While interest rate cuts alone won’t solve all challenges, they will boost investor confidence and stimulate activity across all asset classes, including the office sector.
Industrial Property remains a good source of cash flow for Investors.
Investment in Industrial Property remains a reliable source of cash flow, with tenanted properties yielding upwards of 8% net annual return. With the likely reduction in interest rates in late 2024, the yield of industrial property is unlikely to decrease as much as that of bank deposits. Property investments also benefit from capital appreciation, unlike bank deposits.
In summary, Cape Town’s industrial property market remains robust, with Epping Property playing a significant role in facilitating commercial and industrial property sales. Cape Town’s strategic advantages position it as a stable investment location in the foreseeable future.
Contact Epping Property for a confidential discussion.