The Sandton skyline is dominated by skyscrapers, including the iconic Sandton City tower and the prestigious Michelangelo Towers.
But cranes and scaffolding have become another seemingly permanent feature of the landscape. It appears that as soon as one skyscraper is completed, construction on another begins.
This is despite the countless "to let" signs in front of new office blocks. But don't let them fool you — at 8.5%, Sandton's office vacancy rate is almost half the global average.
Those wanting to be at the centre of it all are paying a pretty penny too, and major corporates such as Sasol, Webber Wentzel and EY (formerly Ernst & Young) are planning to do the same.
With this rapid development comes an ever-growing stream of traffic, as 100 000 people, and counting, inch into and out of Sandton each day.
Traffic has become such a concern that plans are afoot to find solutions, which may include widening the roads and encouraging the use of bicycles or public transport, including buses.
Businesses drive development
Rudolf Pienaar, divisional director of the office sector at Growthpoint Properties, said development is being driven by businesses wanting to consolidate.
High rates affect development
As development in Sandton booms, rates and taxes are a concern for developers and tenants.
Elaine Jack, city improvement district manager for the Sandton central management district, said: "Our levies are based on a percentage of the property valuation; we know for a fact in Sandton the valuations are very high. Property owners are complaining … it becomes unaffordable."
Marc Wainer, chief executive of Redefine Properties, agreed. He said developers are being penalised by local authorities.
According to the City of Jo'burg, all business properties are valued on the same basis and the value of a property determines the rates.
Business property rates are calculated at a ratio to rates for residential properties of 3:1.
To calculate the rates, the city multiplies the value of the property by 0.017604, so if a property is valued at R8-million, rates and taxes would be R11 736 a month.
Wainer said the issue is the valuation of the properties.
"The more you spend, the more you pay"
"The more you spend on improving your property the more you pay. We are subjected to the normal annual increases as well as valuations every three years. If the local authority used a valuation basis of a fixed rate per square metre for all commercial buildings in an area … this would incentivise owners to upgrade."
Wainer said a "rates holiday" should also be considered for a developer who builds a new building and is already paying rates.
"[Not increasing the rates for two years] would encourage development and make initial rentals more affordable."
Wainer said if the issue worsened there are other choices for development — such as Waterfall Park in Midrand, where there is less congestion, and rates are better.
"Then Sandton and Johannesburg are going to be the losers."