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Why office space is making a comeback despite COVID-19
As we continue through lock-down, co-operation and support between commercial landlords and tenants have been key, in order to ensure South Africa’s most successful Central Business District will survive this period. Landlords in Cape Town have moved swiftly to provide relief and advice, to support tenants battling to stay afloat amid stringent lock-down regulations. Rob Kane, Chairperson of the Cape Town Central City Improvement District joins CNBC Africa for more.
Thu, 16 Jul 2020 09:31:58 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- Individual landlords in Cape Town have provided rental relief to struggling tenants, particularly retailers, during the lockdown period.
- Research suggests that long-term working from home may not be sustainable in terms of productivity, emphasizing the importance of people returning to work in offices.
- Cooperation and support between landlords and tenants, as well as proper quality and management, are vital for the commercial property sector in Cape Town to survive the economic impact of the pandemic.
As the effects of the COVID-19 pandemic continue to be felt across the country, commercial landlords and tenants in Cape Town City Centre have been facing challenges. Rob Kane, Chairperson of the Cape Town Central City Improvement District, acknowledges that the city center was already in a challenging position before the pandemic hit, with 80 to 90 percent of the area being office space and 10 percent being retail. However, he notes that individual landlords have stepped up to offer rental relief to struggling tenants, particularly retailers who have been unable to trade during the lockdown. This relief, given in April and May and extended into June, has helped support businesses as they navigate the tough economic environment. Kane also highlights the importance of people coming back to work in offices, citing research that shows that working from home long-term may not be sustainable in terms of productivity. While working from home has its benefits, Kane believes that the essence of city centers, where people come together to do business, will ultimately endure despite the challenges posed by the pandemic. The commercial property sector in Cape Town is facing uncertainty as some companies may have to reduce office space or even close permanently. Kane emphasizes the need for cooperation between landlords and tenants, with those offering better quality and management likely to retain tenants in the long run. Landlords are also grappling with the financial implications of offering rental relief, as costs like sanitation and security have increased. However, the municipality in Cape Town has provided deferments on rates to support landlords during this time. Looking ahead, Kane suggests that a balance in sharing the financial burden will be necessary to ensure all parties can weather the storm.
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