Durban CBD on the rebound

04-07-2003

While real prime CBD office rentals have been flat everywhere, the Durban CBD has surprised with real rentals rising for the last three quarters. And money talks, a local leasing manager says. This increased demand is likely to be the result of firms returning to the CBD.

The latest Rode’s Report shows a 1,7% real growth over the previous 4 quarters. While rentals in decentralised La Lucia Ridge fetch between R60 and R80/m², A-grade office space in the central city leases for about R47/m², and B-grade space for about R32/m².

Old Mutual Properties leasing manager Carlene Kidwell says the increased demand comes in the wake of companies expanding and needing more space. Because of rent differentials between the suburbs and the CBD, it makes more sense for them to return to the city.

Durban Chamber of Commerce chief Jonathan Naidoo says that the government's tax incentive, the urban development zone depreciation allowance, has also had an influence. The incentive allows tax papers investing in certain areas special depreciation allowances for the construction or refurbishment to address urban decay.