PROPERTY: Commerce Drives Rentals In Cape Metro
Recent Western Cape Business News
Busy commercial activity in the Cape Town metropolitan area is helping to drive a steady demand for residential rental properties in the city. So says Pam Golding Properties (PGP), which reports a busy mid-winter season from May to August 2012, with over 470 residential leases concluded or renewed during this period. PGP’s Rentals Manager for the Cape Metro region, Dexter Leite, says demand has been spread across numerous areas and rental categories, with the most sought-after areas including the Atlantic Seaboard, Southern Suburbs and City Bowl. Clients renewing their residential lease agreements are generally encountering rental escalations of five to seven percent in the current market.
Leite says there were particularly high levels of activity at the top end of the rentals market during this period.
“The demand at the top end stems from a number of sources,” says Leite, “including a number of internal relocations within South Africa. It is clear that the Cape’s above-average economic performance and future growth prospects are attracting a number of senior level clients/executives, many of whom are opting to rent while they decide in which suburb they want to buy.”
Recent statistics from the Bureau for Economic Research have confirmed that economic growth in the Western Cape is outpacing that of the rest of the country, and the city of Cape Town remains one of the top destinations in South Africa for investment and foreign direct investment. The provincial MEC for Finance, Economic Development and Tourism, Alan Winde, noted in late July (2012) that the province also showed higher figures for business and manufacturing confidence than the national average. This positive economic data is also evident in the calibre of international businesspeople being attracted to the city, says Leite. “Our rentals over the mid-winter period included leases signed with a number of international clients, from countries as far afield as the US and Hong Kong.”
And the rentals frequently evolve into purchases, he adds. “A number of our top corporate clients have gone on to buy property through PGP, after first renting for a time and assessing their preferred areas and lifestyle needs,” he says. “These include several of our former international tenants who have opted to purchase in the Cape after first renting here while working on contract.”
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