{"id":865420,"date":"2026-07-07T16:10:04","date_gmt":"2026-07-07T14:10:04","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=865420"},"modified":"2026-07-07T16:10:07","modified_gmt":"2026-07-07T14:10:07","slug":"r59-billion-property-giant-is-leaving-gauteng-for-the-western-cape","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/property\/865420\/r59-billion-property-giant-is-leaving-gauteng-for-the-western-cape\/","title":{"rendered":"R59 billion property giant is leaving Gauteng for the Western Cape"},"content":{"rendered":"\n

Over the past 10 years, Growthpoint Properties has purposefully disinvested from Gauteng and Johannesburg in favour of higher-growth coastal regions.<\/p>\n\n\n\n

Growthpoint Properties said this strategy is a response to changing economic conditions, weak municipal services, and stronger growth prospects along the coast, with the aim of optimising its South African portfolio.<\/p>\n\n\n\n

Headquartered in Sandton, Growthpoint is South Africa\u2019s largest real estate investment trust listed on the JSE.<\/p>\n\n\n\n

Founded in 1987, the company is also one of the country\u2019s biggest listed businesses by revenue, forms part of the FTSE\/JSE Top 40 Index, and has a market capitalisation of more than R59 billion.<\/p>\n\n\n\n

Its annual integrated reports over the past 10 years show a consistent strategy of rotating capital away from inland Gauteng, particularly Johannesburg, and towards coastal regions such as Cape Town. The shift has been driven by several long-term challenges affecting Gauteng.<\/p>\n\n\n\n

In its 2019 annual report, Growthpoint warned that the Gauteng region as a whole is under the most pressure.<\/p>\n\n\n\n

\u201cIt is where we have most of our portfolio exposure, amounting to approximately 60% of both GLA and the value of our RSA portfolio. Unsurprisingly, this is causing a drag on our earnings,\u201d it said. <\/p>\n\n\n\n

The company highlighted difficulties in Johannesburg\u2019s office market, where oversupply and rising vacancies have weighed heavily on performance.<\/p>\n\n\n\n

In 2021, it said its largest concentration of office properties was in Sandton, where it also faced its \u201cbiggest vacancy exposure with a vacancy factor of 23.4%\u201d.<\/p>\n\n\n\n

Municipal deterioration has become another major factor influencing investment decisions.<\/p>\n\n\n\n

In its 2025 report, Growthpoint said that \u201cGauteng, particularly the Sandton node, remains an area of weakness, constrained by unreliable municipal infrastructure and services.\u201d<\/p>\n\n\n\n

It added that property owners have faced \u201crunaway municipal cost increases, for which fewer services are being reliably received and a lack of infrastructure maintenance\u201d.<\/p>\n\n\n\n

In response, Growthpoint has deliberately rebalanced its portfolio. The company said its strategy is a \u201crebalance of exposure away from inland Gauteng and towards the coastal regions, specifically Cape Town and, even though it is a smaller market, the Durban area.\u201d<\/p>\n\n\n\n

Western Cape continues to outperform<\/h2>\n\n\n\n
\"\"<\/a><\/figure>\n\n\n\n

It noted that the Western Cape continues to outperform due to favourable property fundamentals and economic conditions, making it an increasingly attractive investment destination.<\/p>\n\n\n\n

To support this strategy, Growthpoint set a target of reducing Gauteng\u2019s share of its South African portfolio to around 50%, down from more than 60% historically. The shift is evident across multiple property sectors.<\/p>\n\n\n\n

In terms of its offices, Growthpoint committed to reducing its portfolio by one-third over five years through disposals in areas with high vacancies and weaker growth prospects.<\/p>\n\n\n\n

It said this would be achieved by \u201cdisposing of underperforming and non-core B-grade assets, primarily through disposals in underperforming Gauteng nodes\u201d.<\/p>\n\n\n\n

As a result, Gauteng\u2019s share of the office portfolio by value declined from 69.2% in 2021 to 64% in 2025, while the Western Cape\u2019s share increased from 25.3% to 30%. The same pattern is visible in logistics and industrial property.<\/p>\n\n\n\n

In 2022, the company said, \u201cIn Gauteng, we have refined our investment focus to the eastern and northern areas of Johannesburg, away from the industrial nodes to the south and west of the city, where we are reducing our exposure.\u201d<\/p>\n\n\n\n

By 2025, Gauteng\u2019s share of the industrial portfolio by value had fallen to 52%, down from 64.1% in 2017, while its share of industrial gross lettable area dropped from 62.8% to 55%.<\/p>\n\n\n\n

Over the same period, the Western Cape\u2019s share of the industrial portfolio by value rose from 20.2% in 2021 to 28% in 2025. Since the 2017 financial year, Growthpoint has sold 186 properties worth R14.9 billion. <\/p>\n\n\n\n

While the company does not disclose exactly how much of this came from Gauteng, or how much was invested specifically in the Western Cape, it said the disposals form part of its strategy to redirect capital towards stronger-performing coastal markets.<\/p>\n\n\n\n

Recent Gauteng disposals include the sale of 14th Avenue Hyper in Roodepoort for R320 million, Mark Park Shopping Centre in Vereeniging for R253.9 million, Growthpoint Business Park in Midrand and the Lascelles property in Germiston.<\/p>\n\n\n\n

At the same time, investment has flowed into projects such as Phase Two of Cape Town\u2019s Arterial Industrial Estate, approved at R219.6 million, and the Canopy by Hilton hotel at Longkloof.<\/p>\n\n\n\n

Others include the net-zero-carbon redevelopment of Ninety One\u2019s offices at 36 Hans Strijdom, and the Peak Studios student accommodation development in Observatory.<\/p>\n\n\n\n

Even within the Western Cape, Growthpoint continues to recycle capital by selling older, non-core properties, including Golden Acre, Grand Parade and Helderberg Centre, to help fund newer premium developments.<\/p>\n","protected":false},"excerpt":{"rendered":"

Over the past 10 years, South Africa’s biggest property company has disinvested from Gauteng due to economic conditions, weak municipal services, and stronger growth prospects along the coast.<\/p>\n","protected":false},"author":92,"featured_media":865426,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"posted","_sma_x_autopost_error":"","_sma_x_post_id":"2074496415850520687","_sma_x_attempts":1,"footnotes":""},"categories":[12755],"tags":[1652,6198,853,3024],"class_list":["post-865420","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-property","tag-gauteng","tag-growthpoint-properties","tag-south-africa","tag-western-cape"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/865420","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/92"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=865420"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/865420\/revisions"}],"predecessor-version":[{"id":865672,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/865420\/revisions\/865672"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/865426"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=865420"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=865420"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=865420"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}