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This months emailer pays homage to the Epping of old and takes a look at the great warehousing that is currently available.
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A bit of History – Epping is an industrial area of Cape Town that is situated centrally on the N7 south of the N1, 15km’s east of Cape Town and north of the N2. Epping Industria was ﬁrst developed in the late 1940s. Industrial development was initially slow and in the early 1950s the circular Gunners Circle was used as a race track for cars. When industrial development picked up in the late 1950s the racing was stopped. The completion of the Athlone Power Station close by assisted in the proliferation of industrial businesses into the area in the mid 1960s
Epping Industria is the largest and most centrally situated industrial area in greater Cape Town.ts proximity to the major roadways and the availability of most forms of public transport make it an extremely sought after location for business.
Using light steel frames to construct buildings is not only faster than conventional building methods, but also contains less embodied carbon – which is the amount of energy used in the entire manufacturing chain of a particular product, says light steel frame association the Southern African Light Steel Frame Building Association (Sasfa). Building methods using light-steel-frame building (LSFB) have until recently not been widely accepted by the architectural industry, as it was deemed unsuitable for complex and creative design. Print Send to Friend 1 0 However, Sasfa claims that, in the recent past in South Africa, not only has this “exciting building method” become increasingly accepted in the mainstream architectural and construction industries, it has also been shown that an architect can design almost any building or structure and have it executed with LSFB. The most recent example is the expansion at the well-known Vrede en Lust farm, in Boland, in the Western Cape, which used light steel frames as part of the venue’s function and wedding accommodation structures. This was built in a typical Cape Dutch style so that it would blend in with the existing buildings on the farm – some dating back to the early 1700s.
The owners decided that it should be a five-star facility, an energy efficient building with enhanced acoustic insulation between rooms, top-class finishes and, most importantly, had to be built within six months as a turnkey project. LSFB contractor The Silverline Group was contracted for the structural engineering, the detail shop drawings, and the total construction project including civil works and finishes. The project began on May 4 last year and the first wedding ceremony was successfully held at the venue on November 7. Sasfa director John Barnard says that the speed of construction possible with LSFB allows the facility to be in use quicker than is possible with other building methods, thereby producing income long before it would otherwise have been possible with conventional building methods. It is not only the speed of construction that saves money in the long term, he says, adding that by using LSFB material, wastage can be reduced significantly, transport costs slashed by up to 80% and the carbon footprint significantly reduced. Barnard states that LSFB is significantly more energy efficient than more traditional construction methods, both with regard to embodied energy of the materials and components, as well as operational energy relating to heating and cooling of the building over its design life. At Vrede en Lust, aluminium-zinc coated, high-strength steel sheet was used for the light steel structure and was roll-formed on a Framecad roll-forming machine. The roof trusses were designed by Silverline Group using software solutions and roof trusses company Mitek’s UltraSpan software. All windows were specified to be single-glazed aluminium frames – owing to the high R-values of the insulated walls, double-glazing was not required. To achieve the Cape Dutch design, a special cobbling plaster, designed by architectural company Malherbe Rust Architects, was used. The building was finished internally with full skim plaster on 15 mm high-impact cement company Lafarge’s gypsum boards with 102 mm Cavitybatt insulation supplied by insulation solutions company Isover. Silverline Group CEO Charl van Zyl says that, with fully skimmed ceilings in all bedrooms, down lighters were the perfect fit for the luxury room designs. Acoustic ceilings were fitted in the kitchen, front entrance and boardroom and restaurant. All bathroom walls were clad with fibre cement board and waterproofed, fully skimmed and painted. He adds that this was one of the most enjoyable and fulfilling projects that his team has undertaken. “We enjoyed working with owners Dana Buys and Ettienne Buys and to implement the Cape Dutch design, we were lucky enough to work with top professionals in the design and construction arenas. It is most pleasing to see that the advantages of LSFB is applicable to all buildings whatever their shape and design and I believe that this building puts to rest any doubt that LSFB will soon become the building method of choice for developers and architects alike,” concludes Van Zyl.
The City has completed the General Valuation for 2015.
Property owners will soon receive an official notice in the post or via e-mail, advising
them of the 2015 valuation of their property/properties. This is the first year that the total valuation of all rateable properties has passed the trillion rand mark in value.
The City’s latest general valuation shows that the total valuation of all rateable properties has increased from R911 billion in 2012 to R1 156 billion in 2015. Property owners would therefore be encouraged to see that their property investment is still increasing in value in most areas in Cape Town.
In total there are 845 764 rateable properties on the General Valuation Roll (GVR) for 2015. The largest portion of properties comprises residential properties (719 681). It also includes, among others, 31 296 commercial properties.
The General Valuation (GV) for 2015 was signed off by the Municipal Valuer on 29 January 2016. It was published on 19 February 2016. Property owners will also be able to view the latest GVR for 2015 by visiting www.capetown.gov.za/propertyvaluations.
Cape Industrial Property was recently awarded the Project Groundbreaker award by Growthpoint Properties.
Project GroundBreaker is the Industrial Property Award that forms part of Project Millionaire, Growthpoint’s broker incentive program.
Cape Industrial Property Managed to win the Western Cape regional prize achieving the highest value for leases concluded over the past 12 months for warehouse space in the Growthpoint Industrial Property Sector.
Cape Industrial also managed a second place nationally.
The award seremony was held at the Barnyard Theatre in Rivonia.
Property groups are shifting to clean industrial properties focussed on light manufacturing, warehousing and distribution as harder manufacturing struggles, SA Commercial Prop News has learnt.
This is while more and more of SA’s economic output comes out of services and less out of hard line manufacturing.
The likes of SA’s biggest industrial property owner, Capital Property Fund, believe heavy manufacturing presents an unattractive business case.
“There is huge pressure on SA’s manufacturing sector. Capital sold out of heavy manufacturing properties some time ago and we don’t see signs that suggest we should go back to that space,” Executive Director at Capital Property Group, Andrew Teixeira says.
Capital’s industrial portfolio is centred on warehouses and distribution centres but it also includes light manufacturing factories.
“Heavy manufacturing is commodity based and can happen in many countries other than SA. You have to be making a niche product to do well with it in this country,” Mr Teixeira says.
The worst month for manufacturing for this year to date was July.
Manufacturing production fell 7.9% year on year in July, suffering its biggest contraction since October 2009, after barely increasing 0.2% in June, according to Statistics SA data.
The output was dented by a four-week strike by steel and engineering workers, largely seeing motor vehicle production cease or be scaled down at various plants.
Economists are not optimistic about how manufacturing will perform next year.
“Manufacturing will probably continue to struggle. In 2004 it accounted for 19% of the economy. In 2013 it accounted for 11%. Labour has priced goods and services to levels which are uncompetitive with SA’s emerging market peers. Manufacturing is in serious trouble and it does not have much of a future in SA,” Meganomics economist Colen Garrow says.
He is concerned that the euro zone, SA’s biggest export destination will re-enter recession.
“Russia’s attempts to re Balkanize the Ukraine will likely push the Euro zone close to recession again. These countries make up a constellation of 18 economies, most of which are destination markets for SA’s exports,” Garrow says.
Nevertheless, Teixeira says that Capital’s warehousing and distribution properties helped the group make double digit income growth in the six months to June.
Apart from the rand weakness benefit that flowed from the Capital’s investments in offshore funds, New Europe Property Investments and Rockcastle Global Real Estate Company, Capital’s better distribution growth was buoyed by the sale of non-core office buildings and lower vacancies in the industrial buildings.
Vacancies decreased from 5.1% in December to 4.2% in June.
Growthpoint Properties’ divisional director for its industrial portfolio, Engelbert Binedell says industrial property is often misunderstood as a part of property. Growthpoint has about R9.3bn worth of industrial properties which represents about 17% of the group’s domestic assets.
“Retail and offices are usually seen as being sexier. Still there are conditions developing to show that industrial property has an exciting future in SA,” Binedell says.
While Gauteng remains the hub for the industrial property class, upgrades to port infrastructure mean warehouses by the coast are becoming attractive.
Binedell says he expects Cape Town and Durban to face a surge in demand from logistics groups in the next few years.
“Infrastructure is being rolled out at our ports. I am always amazed when I stand on Umhlanga Ridge and see ships coming in.
“The daily number of ships docking has clearly increased this year. The industrial sector is healthy at Cape Town, Durban and Port Elizabeth and I think a massive pick up is on its way,” Binedell says.
CEO Andrea Taverna-Turisan listed Equites, an industry focussed fund this year.
He says in about five years, online buying will boom in SA and this will create large demand for warehousing.
“Companies are going to need to store not only fast-moving consumer goods but other goods. SA may have a shopping mall culture but accessibility to online shopping will see people buying goods off the Internet,” he says.
He also says that industrial property is gaining a lot of interest from the listed property funds when it used to be more popular with many unlisted funds.
“When we listed, industrial property just was not that popular. It is becoming popular now with not only unlisted funds but listed Reits (Real Estate Investment Trusts) trying to get their hands on industrial assets. It seems the improved infrastructure by Durban’s ports and the increasing business activity in Cape Town; are among the key drivers,” he says.
Stanlib’s head of listed property funds, Keillen Ndlovu says industrial property has strong fundamentals in SA, which is part of the reason why his funds have stakes in the likes of Capital Property Fund and SA Corporate Real Estate Fund.
These funds’ distribution and warehousing assets are attractive, according to Ndlovu
“Yes, we like the industrial space. The fundamentals are good. Rental growth has been good with 7% growth in the sector in 2013.
“Vacancies are low across all types of industrial property. In fact, than industrial sector has lower vacancies than the retail and office sectors,” he says.
Ndlvou highlights the improving qualities of coastal industrial properties, especially those in KwaZulu Natal.
“KwaZulu Natal has generally been a strong node and commands higher average rents than other regions. The fact there are plans to expand the Durban port are a potential big positive going forward,” he says.
According to a recent report by the South African Property Owners’ Association, Cape Town area has lower vacancies than all other industrial regions do.
Original Article – SA Commercial Property News