Vacancies in SA’s stock of premier-grade office space remain exceptionally low, despite high levels of speculative development activity, reports the latest edition of the SAPOA Office Vacancy Survey.
Premier space continues to enjoy the lowest vacancies – underscoring high demand from tenants – at just 2.2 percent vacancy rate overall.
Given high levels of speculative office development, this performance is particularly noteworthy.
A-grade space maintains an 8.7 percent vacancy rate overall.
Premium offices’ total vacancy of just 2.2% is way below the natural vacancy rate. This shows a strong demand for top-end space within the market.
The SAPOA Office Vacancy Survey is the largest survey of its kind in SA, providing quarterly insight into 15.9 million sqm of office space in 51 distinct offices nodes throughout the country.
As at the second quarter of 2013, the national office vacancy rate across all grades of property stood at 11 percent – a small increase over 2012.
Nevertheless, the high level of speculative development is pushing up vacancy rates across all grades in the SA market.
Current estimates suggest speculative space remains about 50 percent unlet.
Expectations are that speculative development levels are beginning to soften, which should ease the impact on vacancies for the office sector.