JOHANNESBURG-based developer Renprop will develop two office properties worth a total of R150m in two different joint ventures for listed property loan stock company Pangbourne.

Chris Renecle, an executive director of Renprop, said yesterday one of the developments, an office block in Paulshof, would be developed in a joint venture with Vlaming Construction and Devcon.

The other office development, in Constantia, Johannesburg, would be developed together with Probuild Developments. Renprop is involved in the development of commercial and residential property.

Renecle said there was a "strong demand" from listed property companies to obtain new developments for their portfolios at acceptable yields.

"There is very little quality office property for sale in the open market at the moment," he said. The residential property development market had "cooled down" with demand from consumers dropping off.

He said Renprop owned a lot of commercially zoned land, and would be developing a large portion of this because the prospects for commercial property were positive. "In the coming 12 months we are going to see a lot of office property development in Johannesburg."

"Rentals are increasing steadily in the office market which makes developments viable because the supply is running thin. We are expecting rentals in decentralised office nodes to increase to well above the R100/m² mark within the next six to 12 months," Renecle said.

The 10-block, double-storey office block in Paulshof is being built adjacent to the N1 freeway and Witkoppen Road.

The office development will be built in phases with the first two blocks expected to be completed early next year. The buildings range in size from 750m² to 1800m² with a total area of 12400m².

The development in Constantia will consist of three blocks totalling 4200m² of offices, and the first buildings will be completed in October this year.

Extract Business Day 03/08/2006