#BizTrends2024: Beyond the building - how precincts are rejuvenating the office space
From a resurgence in office-centric working to the reimagining of retail and industrial spaces, the industry is navigating a complex tapestry of influences. Abcon Developments managing director, Bryce O’Donnell delves into the key trends you can expect this year:
What is more pertinent to the South African context is that load shedding makes it harder for employees to work in a remote environment, with added network- and connectivity issues. The unreliable power supply has led companies to reconsider working remotely, pushing for a return to the office where power is consistent with sufficient network coverage.
Incorporating a barista at reception and/or canteen offerings are key. Landlords who take control of their surroundings, transforming them into well-maintained business nodes with Green Star ratings are finding success. Upgrades in security and road lighting are becoming essential components of these office environments – resulting in business nodes that not only attract companies but also enhance the overall experience for workers.
Niche, upmarket restaurants and coffee shops are becoming anchor tenants, providing a unique blend of work-friendly environments and leisure spaces. This shift is reshaping the dynamics of retail, with developers increasingly focusing on creating spaces that cater to the evolving needs of the workforce, so the trend of driving out to coffee shops for collaboration is becoming popular.
These typically comprise outdoor communal spaces and coffee shops. Office parks within such precincts, equipped with amenities like gyms, grocery stores, car-wash facilities, braai facilities, bars and coffee shops, that blend with lavish precinct landscaping and water features are becoming the new norm.
The emphasis is not only on creating a safe and collaborative workspace but also on implementing sustainable measures like backup water and electricity to mitigate the impact of disruptions.
Growth in online retailers is driving the need for industrial spaces, particularly warehouses and distribution centres. The previous year (2023) saw an increased demand for coastal industrial spaces, particularly in Cape Town due to its increase in population where demand for industrial properties exceeds the supply.
Positive rental reversions and a decline in national retail vacancies to approximately 5.4% (down from the peak of 7% recorded in 2021) reflect signs of resilience.
With these encouraging indicators, a cautious outlook is still prevalent, considering concerns about sticky interest rates, which we expect will decrease in mid-2024. Township and rural retail are anticipated to continue their upward trajectory, drawing increased investor attention.
Notably, a big off-grid initiative within retail property owners is the adoption of solar within retail spaces. This subsequently enables tenants to continue trading during load shedding and helps combat municipal shortfalls that are prevalent across the country.
The middle and lower-level employees (who constitute more of the country`s population than top-level employees) are still finding more work opportunities within Gauteng. As a result of these opportunities, there is still an overall net positive semi-gration towards the Gauteng market.
