The South African commercial and industrial property sector has experienced its fair share of challenges over the years, however, data indicates positive growth. According to Gmaven, the overall market value of commercial real estate in South Africa has shown impressive expansion, reaching R1.92 trillion as of June 2023, marking a substantial 48% increase from R1.3 trillion recorded in 2015.

While economic uncertainties and evolving work and consumer behaviour continue to reshape demand, resilience can be found through strong rental growth in industrial and commercial properties, a robust retail recovery driven by innovation and consumer experience, and adaptive strategies within the office market.

Navigating Market Volatility

As one of South Africa's leading commercial and industrial real estate organisations and the commercial associate for international real estate advisor, Savills, Swindon has been at the forefront of change in this sector.

During the pandemic, their property management division, which understands the cyclical nature of the sector, was quick to adapt to protect investors' asset value. They were able to minimise operating costs, improve efficiencies where possible, and structure sound solutions that benefited both parties where tenants were struggling to keep up with rental payments. Since the inception of Swindon's Property Management Division in 2019, they've maintained a 100% retention rate for all their clients.

This hard work and determination has certainly paid off, not only for Swindon but for the sector as a whole. Supporting these positive property market trends are favourable economic conditions, including the South African Reserve Bank's decision to cut interest rates to 7.5% in early 2025, which has improved affordability and stimulated demand across all property sectors. Consumer inflation has stabilised at 2.8%, creating a more predictable economic environment that supports positive real estate trends.

Performance Highlights

Within Swindon's own management portfolio they've seen substantial growth. In just the last 12 months they've added over 30,000 sqm to their portfolio, recorded vacancy levels of just 2% and renewal levels of 87%. They've also expanded in several key areas.

·      Their property management division has increased by 25%, managing a diverse range of properties in different regions.

·      They are also managing larger and more valuable properties, thus growing their Gross Lettable Area (GLA) by 16.3%, including Industrial Parks, Retail Centres and large office buildings.

·      The number of tenants they service has increased by 93.3%, demonstrating their robust property offerings and efficient tenant management systems.

By leveraging multi-platform knowledge, industry connections, and through internal research resources, Swindon can accurately provide insight into each asset's market position so that their clients can make informed decisions about their building or portfolio. This is done with the support of in-house facilities management, professional valuations, marketing and one of South Africa's largest brokerage teams.

Market Outlook and Opportunities

Swindon predicts a brighter future not only for their property management division but for the business and sector as a whole.

While office market conditions present a mixed picture across the country, with national office vacancy rates standing at 13.6% in Q1 2025, the Western Cape, particularly Cape Town, continues to buck the national trend by recording the lowest office vacancy rates in 15 years, with high demand in prime areas driving up rental prices and creating a competitive market for quality office space.

The industrial property sector is outperforming other segments, benefiting from strong demand coupled with limited supply, creating favourable conditions for investors and developers in this space.

While the retail property sector is showing incredible resilience, clawing its way back, with trading densities, foot traffic, and rental performance showing a healthy recovery from previous challenges.

Through the synergy of Swindon's leasing teams, together with their marketing capabilities, they're able to provide not only the basic functions needed in rental collection and operation management but also a leasing and asset management overview, building audits, swift collections and a reporting system that ensures clients are kept up to speed in real time.

For more information visit https://www.swindon.co.za/property-management