Inospace notches best-ever Johannesburg leasing month as demand for small industrial space surges

The deals represent a capital value of R42.5m and are 27% higher than the previous best month, underscoring what the company describes as a structural shift in demand for small, flexible industrial and warehousing space in Gauteng.

David Bernstein, managing director at Inospace, said the numbers reflect both the resilience of the SME market and the strength of Johannesburg's industrial nodes: "July is historically a quiet month for us given the school holidays, so to post our best leasing performance yet tells us something important about where this market is heading. Johannesburg has become a real focus area for Inospace, and this rental growth confirms that our strategy is aligned with where the demand actually is."

Bernstein said the July numbers validate a deliberate strategic bet the company has made on Gauteng: "We have made a conscious decision to focus our growth on Gauteng. We believe this is where the next phase of demand for multi-let industrial space in South Africa will be won, and the results we are seeing give us real confidence that this bet is paying off."

Rental rates in Johannesburg have climbed to an average of R80 per square metre, with standout performances in smaller-format space. At one of Inospace's Micro Warehouse offerings, rentals reached R173 per square metre, more than double the average achieved on larger units.

"Our Micro Warehouse product has been a revelation," Bernstein said. "Tenants are willing to pay a significant premium for smaller, well-located, flexible space. We are now rolling out more micro warehouse suites across the portfolio to meet that demand."

The Midrand node remains a bright spot, led by Inospace's flagship Allandale Exchange park, where vacancies are at an all-time low. The airport node, home to several of Inospace's larger parks, also remains robust, with many facilities close to full occupancy.

Notably, 70% of July's new leases were signed by existing Inospace clients, either renewing, upsizing or relocating within the portfolio, a trend Bernstein attributes to improved systems and service.

"Our automated lead-to-lease function, combined with a new AI-driven marketing tool, is delivering hundreds of qualified leads and very high conversion rates," he said.

The leasing surge comes as Inospace continues to expand its Johannesburg footprint, having recently acquired three new parks: one in Wadeville, one in Wynberg, Sandton, and a new site in Isando.

"Johannesburg is entering an exciting phase," Bernstein said. "Between strong rental growth, record occupancy and the calibre of businesses choosing to grow with us, we are confident this momentum will continue."