Claremont’s office and retail market outshines Cape Town’s top locations

Rodes Report Q4:23 mimicked this, highlighting Claremont as one of the top three performers in Cape Town, alongside locations such as the V&A Waterfront, which reported a low vacancy rate of 7%.

Over and beyond State of Claremont The report pointed to a rapid recovery in demand for office and retail space in recent years, with Cavendish Square returning to pre-pandemic levels.

“Claremont has experienced a sharp increase in demand since the Covid-19 pandemic, with nominal rent growth of around 10% during this period (9.8% according to State of Claremont “The report is authentic,” comments Wes Cowan, Managing Director of Galetti Cape Town Auction.

“There are currently 499 retail outlets and R1.29 billion in property investments in the pipeline, with the total value of residential and commercial property in the Claremont CBD having almost doubled in the last decade (according to the latest State of Claremont Report).”

Thriving urban hotspot

Ideally located close to well-equipped schools and the iconic Cavendish Square (built in 1972), just a short drive from the University of Cape Town and on the edge of Newlands Forest, this vibrant neighbourhood is a hotspot that combines all the elements of ‘live-work-play’.

“The majority of new developers in the area have chosen mixed-use properties, with the goal of creating convenience and lifestyle-focused properties where residents almost never have to leave to get what they want.”

Cowan points to the Claremont Improvement District Council (CIDC), which has played a critical role in the suburb’s success by improving public spaces through urban management, public safety and social development initiatives.

The suburb’s continued success has generated significant interest and, as a result, high foot traffic, something Cowan believes retail investors will struggle to find elsewhere.

“The retail culture in Claremont is thriving,” he says. “While Cavendish Square has long been a showcase, new investors have come in to develop the area and recent developments are breathing new life into the area.”

Big names drive demand

“Many major players in the commercial real estate industry are based in Claremont,” says Cowan, pointing to companies like GrowthPoint and New Property Ventures that have been instrumental in the neighborhood’s redevelopment and gentrification.

Stadium on Main was originally developed as an Atrium Shopping Centre in 1990 and has since been redeveloped by New Property Ventures for R75 million. “The building offers a good mix of business and leisure, with anchor tenants Let’s Go Bowling and Rush Trampoline also appealing to young families.”

GrowthPoint’s Draper on Main is another prime example of a commercial property making waves in the area. “Completed in 2019, this 4 Green Star rated project is located in the CBD of the Southern Suburbs,” says Cowan.

Respublica’s Roscommon House is located on Main Road and offers 580 beds in 400 rooms for students. Built in 2018, the seven-storey building is designed to meet the needs of university students and has led to an influx of students now living on Main Road.

With these and other flagship properties attracting a steady flow of visitors to the area, retailers such as BMW, @Home’s new flagship store, Hyundai, Capitec, Bears, Ackermans and Virgin Active have positioned themselves optimally to ensure high visibility and accessibility.

Claremont retail property available

As in many other Cape Town suburbs, acquiring a stake in the Claremont retail precinct has proven difficult for many investors.

“There is limited scope for new development in high-visibility areas, so any property that comes up for auction almost always generates a large number of enquiries,” says Cowan.

Cowan adds that 177 Main Road in Claremont Upper – a prime retail development – ​​will go under the hammer this month.

“The multi-tenanted asset is ideally located on Claremont’s busiest street, generates an annual net income of approximately R2.7 million and has national anchor tenant Hungry Lion with a lease term until November 2028,” he says.

Cowan adds that Hungry Lion is a prime example of an industry leader. “Despite a difficult economic climate, Hungry Lion is one of the top 10 fast food chains in South Africa. Since its launch in 1997, the brand has opened 300 outlets in South Africa, Swaziland, Namibia, Angola and Botswana. Today, it competes with the likes of KFC and McDonalds and is valued at around $5.9 million (Zoominfo.com).”

On the key features of the two-storey shopping centre, Cowan says the building offers high visibility and easy access and comprises seven retail outlets with prominent tenants such as Bradlows, Fish & Chips Basket and Fashion World. It comprises a gross floor area of ​​1,680 sqm and a total unused development area of ​​4,416 sqm (General Commercial Zone 5).

“It’s an exciting time for investors in Cape Town,” says Cowan. “The market has never been more competitive.”

Galetti Auction will bring this property to market on Thursday, 26 September 2024 at 12:00 noon. The auction will take place at King David Mowbray Golf Club, 1 Raapenberg Road, Mowbray, Cape Town.