Commercial builds double in Cape Town CBD's record R12.8bn pipeline
Written on
The number of purely commercial developments in Cape Town's record R12.8-billion Central City Improvement District construction pipeline doubled year on year, according to the CCID's State of Cape Town Central City Report 2025.
Residential developments dominated the record R12.8-billion investment across 29 property developments in Cape Town's Central City Improvement District (CCID) 2025/26 pipeline, but the number of commercial builds doubled compared with the previous year. The finding comes from the newly launched State of Cape Town Central City Report 2025 - A Year in Review (SCCR 25), produced by the Cape Town CCID.
At least six developments, or 21% of all the builds in the pipeline, are purely commercial, with an investment value of R2.38-billion, while additional office space is included in mixed-use projects.
CCID board chairperson and Boxwood Property Fund CEO Rob Kane said the commercial property sector is being shaped by strong demand for quality office space, limited new supply and continued investment in downtown Cape Town. "These trends, together with the upgrading and repositioning of existing buildings, are creating further opportunities for the commercial sector and strengthening the CBD's position as a business and investment destination," he said.
Cape Town continues to record the country's lowest office vacancy rates, according to the South African Property Owners Association, with a rate of 6.1% in the fourth quarter of last year against 15.8% in Johannesburg and 12.1% in Durban. By the end of the second quarter this year the metro vacancy rate had edged up to 6.2%. Within the CBD itself, vacancy stood at 10% at the end of 2025, below the national rate of 12.8%, and rose to 11.9% by the end of the second quarter. The CBD held 1,058,085 square metres of office space at the close of 2025, amounting to 39% of the City of Cape Town's total.
Kane described the market as increasingly dumbbell-shaped, with relatively few vacancies at the top and bottom ends of the quality spectrum while B-grade buildings face greater pressure. Commercial and mixed-use buildings valued collectively at R6.162-billion are in various stages of development, among them Boxwood's R1.7-billion The Matrix, which will add 2,000 square metres of P-grade office space and 570 parking bays on Strand Street with completion scheduled for 2029. Also in the pipeline is the R1.3-billion City Park renovation of the old Christiaan Barnard Hospital by Ingenuity Property Investments and Kasada Capital Management, due to come on stream in the third quarter and adding 10,500 square metres of P-grade office space.