SAPOA Q2 2026 Regional Office Vacancy Report

The report grades office buildings and uses two terms in a specific way. These are its definitions.

• • National vacancy reaches a post-pandemic low. South Africa’s office vacancy rate declined to 12.1% in Q2 2026, the lowest level since early 2020, reflecting a broad-based recovery across the office market.
• • The recovery broadens across all grades. Vacancy rates improved across all grades during the quarter. Prime and A-grade offices continue to have the strongest market fundamentals, while B-grade recorded the largest quarterly improvement, pointing to a more broad-based recovery.
• • Regional performance remains mixed. Cape Town is the strongest metro at 6.2%, while Gqeberha (15.6%) and Johannesburg (15.1%) have the highest vacancy. Cape Town and Durban are now below their pre-pandemic vacancy rates.
• • Decentralised nodes continue to outperform CBDs. Vacancy in decentralised markets (11.0%) remains well below the CBDs (16.0%), reflecting stronger market fundamentals across most decentralised office locations.
• • Development remains subdued, but pre-leasing is strong. Office development remains limited at 0.7% of existing stock, with just 138,204 m² under construction. However, the pre-let rate increased to 70.7%, highlighting the tenant-driven nature of current development activity.
• • Distress is concentrated in lower-grade buildings. While roughly half of office stock remains fully let across the A-, B- and C-grade segments, vacancy distress is increasingly concentrated in lower-grade buildings and highly vacant properties.
• • The volume of vacant space is still high. Although vacancy rates continue to decline, the market still contains about 2.3 million m² of available office space, a more substantial absorption challenge than in previous cycles.
• • Micro-location increasingly drives performance. Performance continues to diverge within the major office nodes, reinforcing the importance of granular, geocoded analysis in informing leasing, repositioning and capital allocation decisions.

South Africa’s office vacancy rate improved to 12.1% in the second quarter of 2026, the lowest level since the first quarter of 2020, before the COVID-19 pandemic. Of the 54 nodes surveyed, vacancy improved in 23, deteriorated in 18 and was unchanged in the remaining 13.

The survey covered 2,690 completed office properties and active developments across 54 nodes, together about 19.3 million m² of gross lettable area including developments under construction. The market absorbed a net 85,240 m² of office space in the quarter.

With vacancy continuing to improve from its mid-2022 peak of 16.8%, office fundamentals remain on a gradual recovery path. In line with this improving backdrop, landlords have continued to adjust asking rentals upwards, with year-on-year growth reaching 7.4%. In inflation-adjusted terms, though, asking rentals in many of the country’s major nodes are still below 2019 levels, and rental growth in some nodes has been measured, so a full recovery in real income and capital values is likely to take time.

Office market fundamentals continued to improve in Q2 2026, with vacancy declining across all grades. Higher-quality buildings still outperform on occupancy and rental levels, but the latest results point to a more broadly based recovery. Prime-grade vacancy declined further to 4.6% and A-grade improved to 9.7%. B-grade recorded the largest quarterly improvement, declining to 16.1%, while C-grade eased to 16.5%.

National Office Vacancy by Grade

These occupancy trends continue to be reflected in rental performance. Prime offices command the highest asking rentals at an average of R228/m² per month and have shown the strongest rental growth in recent years. A-grade rentals continued to strengthen to R151/m², supported by improving occupancy and steady tenant demand. B- and C-grade asking rentals averaged R122/m² and R98/m²; they have also trended upwards, but growth has been more moderate amid relatively high vacancy.

The link between vacancy and asking rentals holds across the quality spectrum. Segments with lower vacancy continue to have more pricing power, while higher-vacancy segments remain more constrained in their ability to drive rental growth. Although the improvement across all grades suggests the recovery is becoming increasingly broad based, Prime and A-grade stock still show the strongest fundamentals, reinforcing the importance of quality, location and building competitiveness in attracting tenants.

In Cape Town the grades are tighter still: adding up the node table at the end of this article gives Prime vacancy of 1.7%, A-grade 3.5%, B-grade 11.3% and C-grade 17.4%.

Regional performance remains uneven, although vacancy has generally improved across the major metros. Gqeberha now has the highest office vacancy in the country at 15.6%, closely followed by Johannesburg at 15.1%. Both have improved from their post-pandemic highs, but demand is still not enough to absorb the available space, particularly in older, less competitive buildings.

Office Vacancy by Metro

Cape Town Metro remains the strongest office market, with vacancy of 6.2%, the lowest of the major metros and now 1.1 percentage points below its pre-pandemic level, which highlights the market’s resilience and sustained occupier demand. Durban has also recovered well, although off a higher base, with vacancy down to 11.9%, 1.9 percentage points below its pre-pandemic rate.

The recovery has been more gradual in Johannesburg, Tshwane and Gqeberha. Tshwane’s 8.5% is now broadly in line with its 2019 benchmark, only 0.3% above it. Gqeberha, the smallest of the major metros, faces the greatest challenge, with vacancy still well above pre-pandemic levels, and Johannesburg has yet to fully recover, still 2.6% above its pre-pandemic benchmark. Overall, the regional data point to an improving office market, although the pace and extent of recovery vary considerably between metros.

Vacancy in the country’s major decentralised office nodes remains well below that of the CBDs, at 11.0% against 16.0% nationally, reinforcing the longstanding trend of decentralised markets outperforming CBDs. The persistence of this gap suggests many decentralised nodes have stronger fundamentals, while several CBDs remain held back by high vacancy and weaker demand.

Tshwane is the exception, with CBD vacancy of 3.5%, far lower than most decentralised nodes. This reflects the metro’s unique demand base, with national and provincial government departments continuing to underpin occupancy. Johannesburg has the highest decentralised vacancy at 13.5%, although it has improved from recent peaks, pointing to a gradual recovery in occupier demand.

Cape Town Metro is the strongest decentralised market in the country, with vacancy of just 2.7%, underscoring its sustained demand resilience. Cape Town’s CBD vacancy is still well below Johannesburg’s and Durban’s, but it has trended higher in recent years, in contrast to the continued improvement in the city’s decentralised nodes. Durban’s decentralised vacancy has fallen to 5.3% and Tshwane’s to 9.9%.

Office development remains subdued at 0.7% of existing stock, reflecting cautious market conditions and a continued focus on absorbing existing vacant space. Development tracked by the survey totalled 138,204 m² in Q2 2026, well below the long-term average of about 490,000 m². The pipeline remains constrained, with limited new project starts and far less activity than in previous development cycles. Of the space under construction, 40,486 m² is still available to let.

Despite the subdued level of construction, projects under way continue to show strong tenant commitment. The pre-let rate rose to 70.7%, well above the long-term average of 55.2%, which shows new developments remain largely tenant-driven, with developers securing a substantial share of space before completion. With occupiers selective and development risk still elevated, high pre-let levels continue to support the viability of projects proceeding to market.

Limited new supply combined with improving occupancy should help support the ongoing recovery. While speculative development remains constrained, strong pre-leasing shows that demand for well-located, competitive office space is still enough to underpin selected new developments.

Cape Town accounts for 64,000 m² of the national pipeline, close to half: 45,000 m² in the Central node (Pinelands and Black River Park), 10,500 m² in the CBD and 8,500 m² in Century City. The detail is in the Cape Town table below.

Splitting rentable space by vacancy bracket shows how uneven the recovery is. Roughly half of A-, B- and C-grade stock is fully let, but the rest differs sharply by grade. A-grade offices have a more favourable occupancy profile, with more of their space in the lower vacancy brackets, while B- and especially C-grade buildings make up a disproportionate share of the higher brackets, including buildings more than 50% vacant. This suggests vacancy distress remains concentrated in lower-grade assets despite broader improvements in market fundamentals.

These buildings face real barriers. Many have physical limitations that make them less appealing to modern occupiers, and valuations, refurbishment costs and redevelopment feasibility limit what owners can do. As a result, weaker properties are likely to keep pushing rentals down in the affected nodes, with landlords relying on discounted rents, incentives and other competitive leasing measures.

The concentration of highly vacant buildings in specific nodes further illustrates how uneven the recovery is. Johannesburg CBD has the largest number of distressed office properties, followed by Midrand and Bedfordview. CBD Cape Town also appears on the list. While many office markets are seeing occupancy improve, the persistence of highly vacant buildings in selected locations suggests performance is becoming increasingly polarised, with asset quality, location and building competitiveness playing a more decisive role in leasing outcomes.

Sandton is often seen as a bellwether for the South African office market because of its size, the variety of its stock and its wide mix of occupiers. Vacancy has improved from its post-pandemic highs, but the node still faces a large absorption challenge after the volume of space developed in previous cycles.

The node average hides a wide spread. Rivonia (5.3%), Alice Lane south of West Street (7.7%) and Wierda Valley and Chislehurston (7.9%) are in single digits, while the Sandton City precinct (25.5%) and Sandown Valley, including Norwich and Park (35.3%), are far above the average. Micro-location, accessibility and building quality are increasingly shaping how offices perform.

These dynamics emphasise the need for granular, location-specific analysis when assessing performance and risk. Spatial and geocoded data can help owners and investors understand how individual buildings are positioned within the wider Sandton node, supporting better-informed leasing, repositioning and capital allocation decisions. The same applies in Cape Town, which is why the node and grade detail at the end of this article matters more than the metro average.

Vacancy rates are a useful barometer of market conditions, but they can hide how much space is actually available. The total volume of vacant office stock adds an important perspective in a market that has grown substantially over time: a vacancy rate similar to a previous cycle can mean far more empty floor space and a correspondingly bigger absorption challenge.

Vacancy has improved from its 2022 peak of 16.8%, but about 2.3 million m² of office space is still available. When the 2003 cycle peaked at a similar vacancy rate of 15.0%, total vacant space was more than 650,000 m² lower. This underscores how the current cycle presents a more substantial absorption challenge than previous downturns, despite the steady improvement in vacancy rates over recent years.

Despite this oversupply, there are still opportunities for proactive owners. Many occupiers are reassessing their space requirements, creating opportunities for well-positioned buildings to capture demand, and buildings that offer flexibility, operational efficiency, strong sustainability credentials or targeted upgrades are best placed to attract them. For landlords, a detailed understanding of node-level dynamics, combined with proactive leasing and asset management, will be critical to improving occupancy and income.

The survey divides Cape Town into seven office nodes. The figures in the table below describe the buildings inside these boundaries.

• • Bellville: Jip de Jager / Mike Pienaar to the west, Voortrekker Road to the south, Old Oak to the east and Van Riebeeck Road to the north.
• • CBD Cape Town: Chiappini Street to the west, the Gardens suburb to the south, Tennant Street to the east and the harbour freeway to the north.
• • Century City: properties within the Century City mixed-use node, including offices on either side of Ratanga Road up to Century Boulevard.
• • Claremont: Highwick / Pine to the south, Protea / Campground Road to the north, Palmyra to the east and the M3 to the west.
• • Central: the Pinelands office node and the Black River Park precinct, bounded by Settlers Way to the south, Jan Smuts to the north and east, and Liesbeek Parkway to the west.
• • Rondebosch / Newlands: Protea / Campground Road to the south, Woolsack Road to the north, Campground Road to the east and the M3 to the west.
• • V&A Waterfront: properties within the V&A Waterfront precinct.

The regional report’s node table gives every Cape Town node’s rentable area, available space and vacancy by grade (P = Prime), how vacancy has moved over the past three quarters, and the lowest, highest and median gross asking rental. Areas are in m² and rentals in rand per m² per month.

Gross asking rentals are the basic rental plus fixed contractual recoveries, excluding metered utilities, and may differ from the rental achieved after negotiation. A dash means the report gives no asking rental for that row.

Committed New Developments in Cape Town

What stands out. The CBD holds 1.06 million m², 38% of Cape Town’s office space, but 125,691 m² of the city’s 172,525 m² available, about 73%. Its B-grade buildings alone account for 77,275 m². The six decentralised nodes together are at 2.7%.

The CBD’s rise from 9.9% to 11.9% over the past three quarters came entirely from A-grade, which went from 1.5% to 7.4%, while B- and C-grade did not move. Claremont went the other way, from 9.0% to 5.5%, as its B-grade vacancy fell from 21.7% to 5.9%.

The V&A Waterfront is effectively full at 0.9%, and its Prime space asks the highest rental in the city at R380/m². Of the 10,500 m² under construction in the CBD, 9,177 m² is still available, while Central’s 45,000 m², the largest pipeline of any node in the country, has just 1,000 m² left.