There was much anticipation during the build-up to President Cyril Ramaphosa’s 2019 State of the Nation Address (SONA), with many specifically looking for clarity around international investor sentiment. While last night’s SONA left uncertainty in some areas, it was made clear that there is to be a significant investment in industry which is great news for the real estate sector.
John Jack, CEO of Galetti Corporate Real Estate, believes that the focus on investment and plans to boost the economy is long-awaited news that will bolster the entire real estate sector. ‘’Last night’s SONA has been very well-received, particularly by the real estate sector which has for some time needed a positive shot in the arm. The positive outlook will have a knock-on effect throughout the industry.’’
‘’Commercial real estate owners have hoped for some time to see the current levels of vacancy being reversed, and President Ramaphosa’s address was certainly the positive news that the industry needed and we should now see businesses take decisions to position themselves for growth.’’
‘’Two of the key items mentioned, namely the focus on expanding agricultural output and Total’s announcement that it made an important gas condensate discovery in the Outeniqua Basin, could see significant investment in South Africa which will be a major boost for the real estate sector as both local and global businesses ready themselves for expansion.’’
From a commercial property perspective, an increased demand for property will further drive construction. Vacancies are expected to dwindle as long as the economy is growing as a whole, and not just certain sectors growing in isolation within the economy. ‘’Overall, the business landscape looks promising as new investment opportunities suggest a strengthening economy and less vacancies, which has been an area of great concern for some time.’’
Source: Galetti Corporate Real Estate