POWER PROBLEMS TO BOOST DEMAND FOR COMMERCIAL PROPERTY

The coming months will see existing commercial and industrial property investments "turning into gold" says Park Village Auctions.

Lawrence Wulfsohn, spokesperson for the PVA Property Division was commenting on the latest auction sale of commercial and industrial properties by the company.

"We detected greater selectivity amongst buyers at our latest auction but accompanied by awareness that new developments simply won't be able to go ahead because of the Eskom moratorium on power supply and that the values of existing properties will benefit.

"Eskom denies there is an official moratorium on new power connections, indicating instead that they will simply not give quotes on such new connections for the next six months. This amounts to the same thing as a moratorium and the phraseology is mere semantics.

"Also there is no assurance that the situation won't be extended further. Consequently existing properties with already installed services will be in demand.

"Of the 13 properties we offered on March 11, eight were sold or are under negotiation.

"Among the sales is a New Doornfontein property, an industrial investment/development opportunity in the shape of four warehouses/factories with a good income stream which realised a price of R4.9m.

"In City & Suburban a property ideal for a motor or industrial workshop with parking for about 30 cars was sold, realising a price of R1.2m and in Wynberg a warehouse facility fronting onto Louis Botha Avenue realised an absolute bargain price of R500 000.

"Interest is clearly still very much intact and there was an excellent turnout at the auction. The mood was one of cautious optimism with buyers clearly assessing their options as opposed to bidding willy-nilly.

"The fundamentals of the market will undoubtedly reassert themselves going forward with buyers being more prepared to commit pen to paper. It's a situation that presents real opportunities for the bolder investor."