Would you pay R570k for a parking spot in Cape Town?
Cape Town - It's a gripe many motorists who have to park in the Cape Town CBD on a daily basis often have - the exorbitant price of parking in the area.
Add to that the scarcity of available parking spots in the city, and it seems as if you just can't put the brakes on paying for parking in the city.
However, while some may bemoan the lack of parking facilities, others - like the seven owners of properties at a new development in De Waterkant - aren't pinching pennies when it comes to securing permanent, safe, off-street parking spots for their vehicles.
Earlier this year, seven parking bays at a Napier Street residential development sold almost immediately - and for a whopping R570 000 each (that's an eye-watering R90 000 p/sqm!)
Johan Malherbe of the Tower Property Fund in Cape Town said while the price may seem excessive to some, it's a matter of "supply and demand".
"In De Waterkant area especially, there's not a lot of parking spaces available. And if you take into account that people pay up to R30 million for a house in that area - and sometimes these properties don't even come with parking spots - it's not difficult to imagine that people would pay large amounts for a parking bay."
Malherbe said that Tower Property Fund, which manages three properties in De Waterkant - on Napier Street, the Cape Quarter and the old Cape Quarter - was not in the business of selling parking bays. Instead, they facilitate a need for property owners who require additional parking bays.
"These parking bays were purchased by homeowners in the complex who needed extra parking. They sold for R500 000 without vat, and R570 000 vat inclusive. How we got to that amount was we established we could achieve a rental of around R2000 per month/ per bay, and capitalised that at 5%.
"For a high gross area like De Waterkant, a 5% yield is relatively low," said Malherbe.
In recent years, parking bays in Cape Town have become lucrative real estate.
Earlier this year, Pam Golding Properties sold two 13sqm parking bays in two Clifton complexes for R580 000 (Eventide complex) and R750 000 (Whitecliffs) each.
But that's chump change compared to the R2m price tag an 18sqm garage parking spot in Clifton sold for in January this year.
However, that doesn't even come close to the $1m a new York property owner paid for a parking spot in a luxury condo in 2014.