Navigating SA's commercial real estate amidst political and global challenges

THE commercial real estate sector in South Africa is being tested by a mix of local political uncertainty and mounting global trade pressure, but the market is holding up with investors adopting a wait-and-see approach.

- EDWARD WEST

Earlier this month, the rand approached a historic low of R19.93 against the US dollar before recovering to R18.97 by April 14. Simultaneously, the JSE All Share Index saw significant volatility, dropping from 89 950.79 on March 31 to 82 485.81 on April 9, before rebounding to 88 162.30 by April 14.

Meanwhile, the FTSE/JSE listed Property Index was down by only 1.34% year-to-date on Tuesday, while it was up 21.93% over a 12-month period. Over three months it was up 0.55%.

The catalyst for the currency and volatility on the JSE? A 31% reciprocal trade tariff from the US (effective April 9), that's sent shockwaves across emerging markets.

It's a sharp departure from South Africa's average 7.6% tariff and effectively sidelines the benefits previously granted to Sub-Saharan African economies under AGOA (African Growth and Opportunity Act).