The entire office component in the first phase of the R300m Colosseum, a 17 000 square metre mixed use development being built on a prime gateway site at Century City, has been snapped up by purchasers seven months ahead of expected completion.
Totalling just over 8400 square metres, the 25 offices suites in the first phase have been sold to 19 different purchasers for a total of just over R93m. About 65% of purchasers are owner occupiers with the balance – totalling around 3000 square metres - being held by investors. Strong interest in the lettable office space has been shown by tenants with negotiations for one potential user for over 2000 square metres as well as numerous other smaller users well underway.
"The market response has been extremely positive and is indicative not only of the strengthening commercial property market but also of Century City's growing stature as a premier office destination," says John Chapman a director of developers, Rabie Property Projects.
He said the generous parking ratio of four bays per 100 square metres with additional visitor bays being provided had also been a strong selling card.
Purchasers have included a strong mix of professionals – lawyers, engineers and accountancy firms, leading property development group, Rabie Property Projects, as well as an international export/import business which will be establishing their South African offices here.
Harry Casper of Associated Insurance Brokers, co-owners of the Double Century Trust which has purchased a 600 square metre suite, said they had decided on the Colosseum due to its very central location at Century City in the heart of the greater metropole, its high level of security and its closeness to all amenities.
"We also have no doubt that Century City is where it will be happening in the future. One only has to look at the massing of development there to realise it is rapidly becoming the Sandton of the south."
Kinney Oosthuizen, senior partner of Schnetler's Attorneys, which has been based at Century City since development began in 1997 and which has done much of the conveyancing work for developments there, said the sectional title Colosseum development had provided them with an opportunity to invest in their own premises.
"After years of renting, we have not only bought fantastic offices but we have also invested for the long term. We believe, particularly in view of the significant capital appreciation enjoyed by investors to date and the very positive outlook for Century City as a major growth node in the region, that it offers unparalleled investment opportunity," she said.
Other owner occupiers include Kayad Engineers, Buchanan Boyes and CCI Management Consultants.
Construction of the Colosseum, which comprises ground floor retail, three levels of offices topped by a luxury four star hotel, is due for completion by December this year.
Colin Anderson, development manager, said the rapid sell-out of the office space and the continued high level of inquiries was accelerating the planning of the second phase of the development which was expected to be launched in the next few months with completion set for end 2007.
He said retail lettings were also progressing well and they were currently finalising the tenant mix to ensure a vibrant highstreet café and boutique retailing environment complementing the neighbouring Canal Walk shopping centre.
Brian Singer of the Singer Group which has acquired the top two floors of the Colosseum for a R100m luxury hotel, said 75% of the 64 suites and six penthouses were sold to investors during the pre-launch phase of the hotel and as a result of the phenomenal response from South African investors, they had cancelled their planned overseas launch.
"Instead we will be holding the official launch in Johannesburg and Durban in June," he said.
"It offers an exceptional investment in the hospitality industry, with guaranteed rental returns for the first two years and one month free accommodation in a hotel suite or in any other RCI affiliated resort."
The Singer Group, which owns several travel companies, hotels and restaurants, has appointed Protea Hotels to operate the Colosseum Luxury Suites which will be graded as a Premier Hotel – Protea's highest category.
