Nationally, the average rental escalations for commercial property remained positive. Although there is still some way to go before escalations achieve the 5.28% it did in 2015, in Q1 of 2022, escalations bounced back to 2.3%. Considering the significant vacant office space available in March 2022 the expectation is that rentals would have experienced aggressive de-escalation. However, these remained positive, albeit flat compared to previous years. Gauteng was the only province to experience three consecutive quarters of de-escalation in 2021, and has recorded an average 1.61% escalation for the first quarter of 2022. The Western Cape avoided de-escalations and is currently slightly below the national average escalation at 2.02%. The biggest surprise is KwaZulu-Natal’s continued recovery with a rental escalation of 4.14%.
