Discovery’s Sandton office set to be Africa’s largest commercial development

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23-07-2014
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Moneyweb
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Also targeting a five star green rating.

JOHANNESBURG – In four years’ time, Sandton will see the opening of Discovery’s new 87 000 square metre head office boasting, despite congestion concerns in “Africa’s richest square mile.”

The Growthpoint Properties and Zenprop joint venture will develop the insurer’s head office, which has been described as “the largest single commercial office development in Africa.”

Growthpoint will own 55% of the building, while Zenprop the remaining 45%.

“This is not something that we have been innovating for a year or two, this has been a long time in the making in terms of acquiring the site. It is systematically four or five years of acquiring properties,” says Growthpoint CEO Norbert Sasse.

The head office will be located at the corner of Rivonia Road and Katherine Street, an area which has become a commercial development node in recent years.

Though not disclosing the total costs, Growthpoint says it “is a cost effective development.”

Discovery is expected to occupy the new building with a 15-year lease - a consolidation exercise housing 5 000 employees from the company’s four buildings currently located in Sandton CBD.

Discovery’s office division director Rudolf Pienaar says the location of the development is in prime property, as it is in close proximity to Sandton City and the Gautrain Station.

It’s not only about the development becoming “a landmark on the Sandton skyline” explains Pienaar, but also infusing green and sustainable elements.

“Green buildings play a key role in providing spaces in which businesses can thrive. For Discovery, it will create a stimulating working environment and reduce building utility costs with sustainable alternatives,” he says.

Bob van Bebber of architectural company Boogertman & Partners says the building is targeting a five star green rating, as it is close to public transport including a proposed Rea Vaya Bus Rapid Transit System, acquired properties for the location were demolished in a sustainable manner, natural lighting is used and the building contains recycling features.

“From our point of view we are constantly pushing the boundaries, in terms of designing buildings. Discovery’s technical team understands what goes into a building from a technical and land point of view,” says CEO of Zenprop James Tannenberger.

Expanding Sandton

The sheer number of speculative developments in Sandton has seen un-let prime office space vacancies in the area increase to 11.3% in the second quarter of 2014, up from 11% in the previous quarter. This is according to a recent South African Property Owners Association (Sapoa) office vacancy survey, which states that over the period Q2 2013 to Q1 2014 the Sandton office node was largely responsible for the bulk of increases in prime vacancies.

The market saw a total of 72 500 square metres vacated, 119 000 square metres let and 192 000 square metres added to stock through developments. Furthermore it is expected that after the completion of all commercial developments, Sandton’s office supply will increase to 1.9 million square metres over the next three to four years.

Sasol and Webber Wentzel are expected to occupy offices in the suburb in 2016 covering 68 000 square metres and 40 000 square metres respectively. Sanlam and Santam are also set to integrate operations in Sandton.