Cape Town’s commercial property surge: Leasing and sales trends in 2025
Cape Town’s commercial property market is booming in 2025, with rising rentals, buyer demand, and a strong shift from Gauteng. Here’s what’s driving the surge.


A post-election shift: Demand relocates to Cape Town
Since the elections last year, we’ve seen a dramatic uptick in leasing demand in Cape Town, driven largely by businesses from Johannesburg and Durban either relocating or expanding into the Western Cape. The momentum has been unprecedented, with this interprovincial shift becoming a defining trend of South Africa’s commercial property landscape.
Rising demand, record-high rentals
As demand spiked, so too did rental prices, and fast. Paarden Eiland, once considered competitive, is now consistently achieving over R100 per square meter. Epping, previously sitting at around R50 per square meter, is now leasing at R70 to R75. These are record highs for Cape Town's industrial nodes and signal strong business confidence in the region.
At Inospace, we’ve observed a compelling trend: internal migration. Our existing clients aren’t just staying, they’re growing. Roughly 30 to 40% of our monthly leasing activity now comes from clients expanding into additional or larger spaces. Many are moving quickly to secure space before it’s snapped up by external entrants.
April’s slowdown and budget speech impact
Despite the hot start to the year, April has followed its usual pattern of unpredictability. The combination of school holidays, public holidays, and uncertainty surrounding the national budget speech created a “stop-start” month. The market cooled somewhat, but not for long.
With the anticipated VAT increase now paused, we’re already seeing renewed interest from tenants. This reprieve could act as a catalyst heading into the second quarter, restoring confidence and encouraging delayed decisions to move forward.
Sales market snapshot: A seller’s paradise
In the industrial sales market, it’s a classic seller’s market. The sharp rise in rentals has prompted many businesses to explore purchasing rather than leasing, but there’s a catch: stock is incredibly tight.
Owners of prime industrial properties are holding onto their assets, and as a result, sale prices are being pushed upward. In some cases, sellers are achieving above their asking price, particularly when rare opportunities come to market.
A clear example is Airport Industria. At the start of the year, we had four mid-sized warehouses on the market. When the interest rate was lowered, demand surged and all four units were sold within February.
Looking ahead: Confidence in Cape Town's commercial core
The underlying theme? Confidence. Cape Town has become a magnet for business expansion, and the numbers back it up. Between rising rentals, high absorption from existing clients, and investor interest in ownership, the city is positioned for continued growth.
As we move further into 2025, all signs point to another strong year for both leasing and sales, particularly if economic policy continues to support business development and inflation remains in check.
Need space or want to invest? Let's talk.
Whether you’re expanding, relocating, or considering a move from leasing to ownership, the Inospace team is here to guide you through the fast-evolving market. Contact us for tailored opportunities in Cape Town and beyond.