HILTON TARRANT: News is that petrochemical giant Sasol plans to consolidate its Gauteng head offices, which currently span 17 buildings across Rosebank, Randburg and Bryanston into one giant 67 000m2 building in Sandton.
Alchemy properties and the Sasol Pension Fund will co-develop the building. Greg Sacks is chief executive of Alchemy Properties.
Greg, this building, 67 000m2 – how big is that? Have we seen a development this large recently?
GREG SACKS: Hi, Hilton. Look, it’s very big. I think the most comparable one at the moment that has just gone up is the new Standard Bank Building in Rosebank, which I believe is about 60 000m2, so it’s along the same lines as that in terms of size.
HILTON TARRANT: We haven’t really seen this scale of single head office go up for a private-sector company since Old Mutual and Sanlam built their head offices way back when.
GREG SACKS: Ja, look, it’s very exciting for us to be involved in something of this size, and it is big. But there’ve been so big developments – not as big – but you’ve got Alexander Forbes, which went up about a year ago, which is half the size. And some of the law firms with their growth trajectories are also pushing in terms of size. But this is certainly a big one.
HILTON TARRANT: Greg. This site is on Catherine Street in Sandton, slightly away from the kind of traditional old Sandton CBD, which is on the West Street side of Sandton. Lots of interest in this area?
GREG SACKS: Well, ja, that’s right, Hilton. Our belief has been that the new entrance to Sandton City and the development of the Gautrain Station will basically pull development closer to those amenities and when we looked at the area we identified the Wierda Valley side of Catherine Street as being undeveloped relative to the traditional areas.
And because of its proximity to the Gautrain and Sandton City we really thought that this was where the development was going. And you’ve seen that that’s been the case because, if you move up Catherine Street, you can see the new Forbes building, the new Ernst & Young building going up. Webber Wentzel are developing at the top of Catherine Street.
So really it’s become the new development node and you don’t have the infrastructure on that side of Catherine Street that you do in the rest of Sandton. So I think it’s also much more economical to develop on this land than to bring down the larger, more expensive structures.
HILTON TARRANT: Not just yourselves that are looking at that area. Growthpoint are also eyeing it with keen interest.
GREG SACKS: Ja. Growthpoint have got a big land holding. We are discussing with them the prospect of integrating our two land holdings to look at an office-precinct type environment to really have a top-grade office offering with great architecture and some lifestyle amenities.
And you’ve also got other developers on either side of Catherine Street who’ve got large land banks, and everyone is just waiting to try and secure strong tenants to try and get those developments away.
HILTON TARRANT: Just in terms of green rating for this building, I’m guessing you are not going to get away with anything less than four- or five-star?
GREG SACKS: Yes, that’s right. We are going for a five-star rating. Obviously you only get the rating once the Green Building Council gives it to you, but that is certainly our goal and we are doing that.
HILTON TARRANT: Greg, the timelines? When is Sasol hopefully moving in?
GREG SACKS: They are targeting the third quarter of 2016. We’ve started already with demolitions – and ja, we’ve got a lot of work ahead of us.
• Subscribe to a daily email of transcripts from Moneyweb Radio – click here