“While the look ahead will be challenging for the South African property industry as a whole, there are still pockets of opportunity for investors, landlords and tenants”, says Tim Cable, director, who now heads up the real estate sector in South Africa for global professional services consultancy, Turner & Townsend.
“With limited growth in the economy, the Reserve Bank in an interest rate hiking cycle, and socio economic and political pressures, our industry will need to look beyond its current operating models and modus operandi to find these opportunities in the market.”
With considerable experience gained managing the programme management office and capital investment plan at Absa/Barclays, Cable has a broad view of the market and a clear understanding of the importance of aligning a business’s real estate strategy.
“Securing greater capital efficiency on projects is at the heart of what we do. In any business, life cycle costing and operational expenditure is key in delivering a successful real estate solution.”
Commenting further Cable says office space vacancies are on the rise with new developments coming on stream, the competition between landlords is fierce and it’s a tenant market at present.
“This is where Turner & Townsend’s value add comes into its own. We have a unique specialism in high-end fit-out and have undertaken many such projects for the likes of Google, Barclays, Microsoft, Philips, Grant Thornton, Sasol, Chevron and General Electric to mention a few”.
“The value of such fit-outs is significant and landlords offering a holistic solution as opposed to competing over a clean white space provide a compelling offer to prospective clients. Our expertise in being able to effect high quality outcomes within tight timeframes, combined with a cost effective solution, makes our contribution significant in the overall supply chain.”
Fit-out for Google Johannesburg office building in SA
Turner & Townsend were appointed as cost managers for the recent Google Johannesburg head office building fit out in South Africa – this year’s SAPOA Innovative Excellence Award winner in the Interiors and Overall Green Award categories.
Cable believes the opportunities sit within both refurbishment projects of existing space as well as redevelopment of existing sites, with blue chip companies looking to consolidate their current portfolios and leverage off new workplace methodologies.
Agile and collaborative workplace design
He says the office property market is going to need to be cognisant of the new workplace requirements as buzz words such as agile and collaborative workplace design requirements are incorporated within the traditional open plan floor plates.
“Agile working is all about creating a flexible and productive environment – by creating different working areas within the office a business can ensure employees have complete freedom and flexibility to work where they want, when they want”.
“These workplace design requirements will also influence the amount of space that corporates require as many encourage working from home and other innovative methodologies to reduce floor space requirements as they will look to optimise their current portfolios, and exit space which is not necessary”.
“Many of our clients are using flexible working environments to increase the headcount allocation to these spaces, so instead of 1:1 desk allocation ratios, these are being increased to 1:2 or 1:5 people per desk. By eliminating desk ownership you create an environment that is more effective and efficient”.
“The ratio applied is derived through space utilization monitoring as in many instances 20-30 percent of the workforce is away from their desks due to meetings, leave, medical reasons and so on. This then provides an opportunity to maximize the floor plate to account for this under-utilization. Some of our clients are also allowing their staff to work from home one day a week, which creates further opportunities to rationalize the space requirements”.
“With 90 offices around the world our global property team work for some of the world’s most successful companies and forming a part of this is our local team who are providing more and more programme-level solutions in the property space.” Cable adds.