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Roads and retail: Increased capacity for increased growth

Roads and retail: Increased capacity for increased growth

Roads are the arteries through which the economy pulses. By linking producers to markets, workers to jobs, students to school, and the sick to hospitals, roads are vital to any development agenda.

Since the Gauteng Freeway Improvement Project (GFIP) began in 2008, various economic hubs have sprung up in Gauteng, among them the recently renovated Menlyn Park Shopping Centre, Lynwood Park, Waterfall City, the Samrand Business Park and the Irene Link Precinct.

Waterfall City developers, the Atterbury Group, have recently also announced the construction of an R800 million, 65 000 m2 industrial park in Midrand, while Barloworld Logistics will soon move into its new head office to Centurion.

Pretoria is home to the 112,828 sqm Centurion Mall, while the new Menlyn Maine Towers, which benefit from recent infrastructure upgrades, provide motorists with easy access from the Atterbury and Garsfontein off-ramps.

A key consideration for the GFIP was to increase traffic capacity on the province’s national road network. Capacity, access and visibility are primary considerations for retail developments, with these characteristics all affecting the size and scope of these buildings.

With approximately 980 000m² Gross Leasable Area (GLA) available for commercial and light industrial development, Waterfall City in Midrand, Johannesburg, spans land on both sides of the N1 highway and is characterized by excellent accessibility and visibility.

Its Mall of Africa is the largest single-phase shopping mall in the country, with a total retail area of 131 000m². Menlyn Park has a total lettable floor space of 177,000m², over 500 stores, 16 parking entrances, 12 parking exits and 8,250 parking bays.

It’s no coincidence that these developments are all within close proximity to the N1, the busiest stretch of highway in Southern Africa. And it is also no coincidence that three of the 10 biggest malls in South Africa are found on this stretch that links Pretoria, Midrand and Johannesburg.

In fact, the greater Johannesburg area (including Sandton, Midrand and Pretoria) is home to the biggest concentration of retail space anywhere in the country. Gauteng has over 10.8 million m² of retail space alone, making it bigger than the Western Cape, KwaZulu-Natal and Free State combined.

“Infrastructure is the absolute defining factor in the development of any commercial property,” says James Ehlers, developments managing director at Atterbury Property.

“The construction (widening and improvement) of the N1 undoubtedly had an impact on development around Waterfall City,” Ehlers confirms. “Whether those developments would exist today without it, probably, albeit in a much-diluted form, can be debated. Expansion would occur as the road network expands.

“It is very clear that where road and other infrastructure is not being put in, development is sterilised. Existing infrastructure is put under strain and ultimately fails. Developers move elsewhere,” he adds.

South Africa has a thing for retail. There are almost 2 000 shopping malls covering over 24 million m², making it one of the most mall-rich countries in the world. Trade and retail accounts for 15% of South Africa’s gross domestic product, and South Africans spent R31 900 - per second - in retail stores in 2017, according to Stats SA.

Ehlers notes that accessibility for mall shoppers is paramount to accommodating this sector of the economy. “Easy access from Gauteng’s transport network is an inherent advantage. Mall of Africa is at the hub of major transport routes for shoppers coming from the north, south, east and west,” he points out.

“For a super-regional shopping centre the size of Mall of Africa, this means creating the best access for shoppers from across an entire province and even further afield.”

Part of the first phase of the GFIP included significant upgrading of 34 interchanges, in the interest of easing traffic congestion. This too, has had positive developmental spin-offs.

“It's definitely easier to sell or rent commercial properties if there are no congestion issues and one can get in and out of the business premises easily,” says Arnold Pretorius, property agent at the API Property Group.

“If you consider Allandale and compare it to what it was five years ago, it is probably now one of the easiest off-ramps to take on the N1. It used to be a parking lot. Today it is a fifteen minute drive from the Samrand off-ramp to Waterfall Estate, which is a pleasure to access.

“Eight years ago, people from Centurion would say to me they are not looking to develop or lease anywhere else. But, now that Samrand is less congested, the area has become more popular and new developments continue to be let there,” he concludes.

It is clear that infrastructure stimulates and even accelerates growth. For Gauteng, responsible for 40% of South Africa’s GDP, continued growth is essential to continue infrastructure investment and growth. The development of the second phase of GFIP remains a critical success factor for the continued growth in Gauteng.

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