Claremont office and retail market outshines Cape Town's top spots

Source: Facebook/Cavendish Square

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

In addition, the State of Claremont report cited a quick recovery in demand for both office and retail in recent years with Cavendish Square back to pre-pandemic levels.

“Claremont has enjoyed a sharp uptick in demand since the Covid-19 pandemic, with the growth of nominal rentals sitting at around 10% over that period (9.8% according to the State of Claremont report),” comments Wes Cowan, managing director for Galetti Cape Town Auction.

“As it stands, there are 499 retail outlets and R1.29bn in property investments in the pipeline with the total value of both residential and commercial property within the CBD of Claremont almost doubling over the past decade (according to the latest State of Claremont report).”

Thriving urban hotspot

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

“The majority of new developers in the area have opted for mixed-use properties, underpinned by the ambition of creating properties centred around convenience and lifestyle, where residents hardly ever have to leave to get what they’re looking for.”

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

As a result, the suburb’s ongoing success has yielded high interest and as a result – high foot traffic, something that Cowan believes retail investors are hard pressed to find elsewhere.

"The retail culture in Claremont is thriving,” he says. “While Cavendish Square has long been a flagship, new investors have stepped in to further develop the area with recent developments breathing new life into the neighbourhood.”

Big names driving demand

“Many big commercial property players call Claremont home,” says Cowan, pointing to the likes of GrowthPoint and New Property Ventures which have been instrumental in the redevelopment and gentrification of the area.

Stadium on Main was originally developed as the Atrium Shopping Centre in 1990 and has since undergone a R75m redevelopment by New Property Ventures. “The building delivers a good mix of business and leisure with anchor tenants Let’s Go Bowling and Rush Trampoline appealing to the likes of young families too.”

Draper on Main by GrowthPoint is another prime example of a commercial property that’s making waves in the area. “Completed in 2019, this 4-star Green Star rated development is located in the business node of the Southern Suburbs,” says Cowan.

Situated on Main Road, Roscommon House by Respublica offers 580 beds in 400 rooms for students. Developed in 2018 and comprising seven floors, it caters to the needs of university students and has been responsible for an influx of students who now live on Main Road.

As a result of these and other flagship properties driving a steady stream of visitors to the area, retailers like BMW, @Home’s new flagship store, Hyundai, Capitec, Bears, Ackermans and Virgin Active have ideally positioned themselves for high visibility and accessibility.

Claremont retail property available

Like many other suburbs in Cape Town, claiming a stake in Claremont’s retail area has proved to be challenging for many an investor.

“Room for new developments in high visibility areas are limited hence why any property coming to auction will almost always generate a high number of enquiries,” says Cowan.

Cowan adds that 177 Main Road in Claremont Upper – a blue-chip retail collection - will go under the hammer this month.

“The multi-tenanted property is ideally located on the busiest street in Claremont, generates a net annual income of approximately R2.7m and features national anchor tenant Hungry Lion with a lease period up until November 2028,” he says.

Cowan adds that Hungry Lion is a prime example of an industry trailblazer. “Despite a tough economic climate, Hungry Lion is one of the top 10 fast-food chains in South Africa. Since its inception in 1997, the brand has gone on to open 300 stores across South Africa, Swaziland, Namibia, Angola and Botswana. Today it competes with the likes of KFC and McDonalds and is valued at around $5.9m (Zoominfo.com).”

Speaking to the key features of the two-floor retail centre, Cowan adds that the property offers high visibility, easy access and includes seven retail stores with prominent tenants such as Bradlows, Fish & Chips Basket and Fashion World in the mix. It spans a GLA of 1,680m² and a total unutilised development bulk of 4,416m² (general business 5 zoning).

“It’s an exciting time to be an investor 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 noon. The auction takes place at King David Mowbray Golf Club, 1 Raapenberg Road, Mowbray, Cape Town.