A weakening demand for office space as well as sluggish growth in market rentals are on the cards, says Erwin Rode, professional property valuer and property economist at Rode & Associates.
This is due to declining growth in the service sector of the economy and diminishing business confidence. The poor performance of the services sector implies a weaker demand for office workers and, therefore, also for office space. A lack of confidence in the business sector furthermore also inhibits staff expansion, says Rode.
Growth in the demand for office space has already declined so sharply that vacancies stagnated in the first and second quarters of 2013. The result is that growth in nominal market rentals for office space in the larger suburbs of the country remains weak ─ with increases in all cases below building-cost inflation.
At the yearly Rode Breakfast events of Rode & Associates in Port Elizabeth, Bloemfontein and Durban, Erwin Rode will be discussing issues such as these, and will be sharing his views on the outlook for the property market.
Dr Cees Bruggemans, consulting economist to First National Bank, Dawie Roodt, Director/Chief Economist at Efficient Group and Dennis Dykes, Group Chief Economist at Nedbank Ltd, will in turn closely examine the economy as a whole at the Port Elizabeth, Bloemfontein and Durban breakfast events respectively.