"We're seeing a lot of new dynamics coming into play this year, from Chinese foreign investment, to repurposing of city buildings around the country and an opportunistic listed property sector taking its first steps into investment in new asset classes and new African countries," says Excellerate Property Services CEO, Marna van der Walt.
One of the most exciting trends emerging in the property sector is the repurposing of CBD buildings and the re-energising taking place in some South African cities. "These projects are going ahead in areas where there has been some urban decay. It is great to see the opportunities that are being created by repurposing CBD buildings, especially in cities such as Durban and Johannesburg.
"In Cape Town, there is a big move toward greening in the city. Many property developments, redevelopments and upgrades and focused on sustainability and efficiency, and there are many more opportunities for this.
"Another force emerging on South Africa's landscape is the increased level of Chinese investment, especially in the construction and property sector. In 2013 and 2014, several deals were stuck, which will go ahead this year. These investors are injecting funds into urban peripheries and promoting development in the more rural nodes."
When it comes attracting FDI for the property sector, van der Walt believes South Africa is at an advantage on the continent, within the present context and remains in a strong position to attract investment. "South Africa has always been the strongest country in Africa in terms of attractiveness to foreign direct investment (FDI). It attracted 24% of all FDI between 2007 and 2013 and may perform even better going forward."
The World Bank's Doing Business Report 2015 ranks South Africa second highest on the African continent, for attractiveness and ease of doing business on the African continent.
The company is also seeing its listed property clients diversifying into new subsectors, with residential housing foremost among these, including student accommodation. However, the sector's search for advantageous opportunities goes even further, such as medical and storage facilities.
The sector is not only looking for new investment opportunities, but also considering all areas that can add value to their businesses. "Property owners are seeking new avenues for income from their assets, such as building sources of non-GLA income streams. They are looking to offset pressure on rentals by focusing on new ways to optimise cost-efficiencies. For cost reductions, bundled services are increasingly being recognised as an effective way of achieving cost savings.
"The property sector will have two focuses in the coming months: keeping the basics in excellent order and finding the next big thing, or big things, to drive property performance," concludes van der Walt.
