Inospace flags surging demand for small industrial units in Cape Town

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03-09-2025
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Property Wheel
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One-third of the 38 small industrial units at Inospace’s Creation Works in Montague Gardens, Cape Town, were sold on launch, underscoring the surging demand for compact industrial space.

Located adjacent to Century City and within immediate reach of the N1, N2, and major arterial routes, Creation Works offers accessibility and scale with yards, reticulation for trucks, parking and security. Inospace has also invested in a solar plant at the site with solar energy to be shared by unit owners.

“Montague Gardens has always been a forerunner for Cape Town’s industrial property market,” said Rael Levitt, CEO of Inospace. “What we are seeing now is a clear structural shift: smaller, more affordable industrial units are outperforming the market. Creation Works taps directly into that trend, giving smaller businesses and private investors the chance to own a piece of one of South Africa’s most resilient industrial nodes.”

Over the past year, capital values in Montague Gardens have risen 13%, fuelled by surging demand, constrained supply, and a more supportive interest rate environment. Rental rates in the node are approaching R100 per square metre, while replacement construction costs (excluding land) stand at R12 000 to R13 000 per square metre. The widening gap between cost and value has triggered demand for sectional-title ownership with units enjoying full occupancy and year-on-year rental growth of 15%.

“These sales transactions further progress our strategy of crystallising value from the sale of mature assets and recycling capital into acquisitions where we have identified an opportunity to add value through our platform,” says Levitt.

Inospace has earmarked another R750 million in acquisitions in the Western Cape over the next year, having recently acquired its eighth business park in 2025, Marine Works in Paarden Eiland.