Photo by: Bloomberg
A study commissioned by the South African Property Owners Association (Sapoa) has found that the real estate sector contributed R1.32-billion to the fixed capital stock of the country in 2013, while the gross fixed capital formation of the sector added R97-billion over the same period – respectively representing 20.9% and 14.95% of the entire economy.
The report, titled ‘The Economic Impact of the Commercial Real Estate Sector on the South African Economy’ further revealed that, of the R97-billion capital formation, R69.7-billion, or 71.2%, was attributable to nonresidential buildings.
Nonresidential real estate, meanwhile, contributed R81-billion to the gross domestic product (GDP) of the country over the year, resulting in some 212 000 jobs – around 1.5% of all jobs in the economy.
Moreover, commercial real estate contributed around R174-billion to economic activity in 2013, generating R6.5-billion in taxes over the period.
The bulk of this economic activity was observed in Gauteng, followed by the Western Cape and KwaZulu-Natal.
“As evidenced by this report, buildings [and their development] are a barometer of a city’s economic health and a major contributor to the economic lifeblood of the entire [country], from employment to tax generation to direct spending and beyond,” commented Sapoa CEO Neil Gopal.