R40m commercial deal brokered in PE

A R40m industrial and commercial development in PE has recently been brokered and a number of other big-ticket transactions in the city are in the pipeline. Mike Henderson of Port Elizabeth-based Henderson Properties says thanks to the handful of landlord families which control the majority of the city's commercial and industrial properties, Port Elizabeth has not experienced much in the way of the sell-offs and declining values being experienced in other parts of the country and the world.

Though upbeat about his company's ongoing success, Henderson says it's not without its challenges. "We're finding that while there are still many prospective tenants around, they are slower in coming forward and signing. They are also a lot more fussy and determined to get maximum value for their money."

Mark Connett of Just Letting Commercial in Port Elizabeth is also enjoying fairly brisk business despite the state of the economy. "We have a lot of good stock available, partly as a result of the automotive and allied industries downscaling. Along with this we're getting a lot of solid enquiries."

Among the enquiries which have recently translated into sales is a substantial property in Chelsea, earmarked for a unique residential, hotel and conference development. It was sold by his partner Paul Stevens. The team is also in the process of concluding some high-value deals across the Port Elizabeth region on the back of good demand for investment properties, Connett notes.

Newton Park is currently one of their most active areas. Once a purely residential suburb, it's now home to a growing number of office conversions, many of which are being bought by service-related businesses and start-up companies. Triple A-grade offices start from around R95/sq m, while at the top end of this market, the offices in a four-storey building are going for R120sq m.

He also reports healthy demand for premises in the Deal Party area, which lies just off the N2 Highway, about 7km from the harbour and about 15km from Coega. Its location makes it ideal for logistics and allied companies, he says, hence a shortage of stock here.

In Struandale, home to a number of automotive and components manufacturers as well as a Ford Engine plant, General Motors and Trident Steel, Connett says there's some well-priced warehousing up for grabs. Brand new, with solid floors, good power supply and high roofs, it's available from R35/sq m to R42/sq m.

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