One of the most important aspects of investing in commercial property is good timing. Since the market situation is experiencing certain turbulences, not only in Cape Town but also in other countries worldwide, this becomes even more important. In general, you want to ensure you are getting the right value for money and secure ROI with minimal risks. However, despite all the difficulties, Cape Town’s commercial property market has offered potentially lucrative investment opportunities for some time already. Despite the inflation in the previous period, this part of South Africa is demonstrating notable economic growth. If you plan to invest in Cape Town commercial property, it’s essential to first understand the existing and often underestimated investing potential.
Why invest in Cape Town commercial property
At the moment, the global commercial property market has been under pressure. But, there are numerous signs that this will change for the better, especially if you are considering investing in the beautiful city of Cape Town. Due to various overall studies, Cape Town is labeled one of the best cities to live, work, and invest in. Add the modern lifestyle and beautiful surroundings into the mixture, and there is more than one reason to admire it. But, from a financial aspect, its benefits are a bit less obvious. At least, not to everyone. Nevertheless, Cape Town is constantly developing, providing more and more investment opportunities as time passes.
To help you make your decisions, here are reasons why investing in Cape Town commercial property can be beneficial:
- The location is amazing
- Cape Town development is on the rise
- Many opportunities to increase the value of property
- Good property resale opportunities
- Potential for high rental profit
However, let’s first make a distinction between types of commercial property.
Different types of commercial property
There are three distinct types of commercial property:
- Office space – you can find a variety of office spaces in Cape Town. From small units to large complexes in CBD buildings.
- Retail space – this includes different types of retail properties, from small shops to large malls.
- Industrial space – includes small, large, and huge facilities, used for everything from manufacturing to warehousing.
Overall, one of the most important things to remember is to keep an eye on factors that may cause the value of a property to drop. Therefore, you must be aware of all potential common threats to your investment when buying commercial property. Numerous factors can affect the value of property in the future. Some might be beneficial, but others can easily decrease the value. That’s why it’s necessary to always carefully inspect the property and research the market in detail. Also, you need to follow and predict trends and situations that may occur.
The location is amazing
The location of the commercial property holds great importance. The property needs to be in an excellent spot to serve its purpose and secure the return of investment. And Cape Town more than delivers in this respect, especially with its business centers and surrounding areas. The number of business districts is expanding, which will result in a plethora of options. They will provide additional space for future offices, startups, and everything from small to large businesses.
The city itself is in a prime location, considering major routes, facilities, and available amenities. Many people already think about moving to this part of the world. Because it’s one of the attractive tourist destinations, it will eventually lead to the increased demand for commercial spaces in upcoming years.
Cape Town development is on the rise
Besides the number of current development projects, several large projects are waiting to begin. This will undoubtedly attract many investors. The government is also investing in improving infrastructure not only in Cape Town but in other places too. This includes water, energy, telecommunications, and transport, which are already contributing to the steady growth of the commercial property sector. It is worth mentioning that industrial space is in the lead at the moment. However, this changes depending on the global situation and needs monitoring. Soon enough, other types of commercial property will catch up.
Many opportunities to increase the value of property
In addition to being an ideal location, Cape Town offers a vast range of opportunities to find a property you can improve. Besides new projects, there are more than a few older properties worth investing in. This doesn’t include only commercial but residential property as well. Investing in improvements will raise its initial value and provide a sure profit in days to come, especially if we take an increasing number of foreign investors interested in this particular market. These commercial properties are already in decent condition and are pretty spacious. With a minor renovation or transformation, it can be profitable for selling after only a few years.
Good property resale opportunities
Another aspect, in close connection with the previous, is that the value of commercial property in Cape Town increases over time. There is a prediction that the demand for offices and mixed-use buildings will skyrocket. If you are looking for a city with good potential for investment, now might be a good moment to invest here. It has the most stable commercial and residential real estate market in the country. And it will only continue to grow. There is a reason for the increase in investments in luxury apartments and office spaces in this part of the world. Owning such property at the moment might give you the potential for extraordinary revenue once you resell it in a few years.
Potential for high rental profit
Another reason why investing in Cape Town commercial property is smart is the growing demand for rentals. Considering all the predictions, and even the current situation, companies are already searching for future office space. As an investor, you can expect that this commercial sector will thrive, especially if you own buildings in the inner circle of business centers. These rental opportunities can be a considerable income once the global crisis is over.
Generally speaking, this is a great time to invest in Cape Town commercial property considering the consequences of the current situation. Many businesses, including offices, shops, and factories, are feeling pressure because of the global recession. This allows you to acquire property at a profitable bargain and patiently wait for opportunities. On the other side, Cape Town continues to invest in development. So it’s up to investors whether they will take this opportunity or not.