How to maximise your commercial property renovation budget amid SA’s spiraling building material costs

As a commercial or industrial property manager in South Africa, maintaining your property’s value and functionality is becoming increasingly expensive. Still, building renovations remain necessary to attract and retain business tenants in an increasingly competitive commercial property sector.

This is according to Calvin Venkates, CEO of the Posch Group, a specialist in complete turn-key project management solutions and construction resources, who says that efficient project management is crucial to saving money on buildings costs.

He notes that as the cost of building materials continues to rise year on year on the back of various factors, such as the cost of raw materials, transportation, and labour, building renovations can still be optimised if managed correctly. According to Stats SA Construction Materials Price Index for January 2023, the annual change in the index for total construction was 9,4% in January 2023.

“In recent years, the South African construction industry has faced challenges such as political instability, fluctuating exchange rates, and supply chain disruptions due to the COVID-19 pandemic, which have steadily pushed up prices,” said Venkates. “Unfortunately, these price points seldom come down, so commercial and industrial managers must optimise their building maintenance and renovations.”

He says the best way to enhance value is through strategic renovations that improve the property’s appeal and performance.

However, planning and executing a renovation project can be overwhelming. Here are eight tips Venkates has learned over the last 16 years to help guide your next commercial property renovation:

1. Define your goals and budget.

Before you begin any renovation project, you should define your goals and budget. What is the purpose of the renovation? What are you hoping to achieve? And, of course, How much money are you willing to invest? Defining these parameters will help ensure that you stay focused and on track throughout the renovation process.

2. Consider your tenants’ needs.

Your tenants are your customers, and you want to keep them happy. Consider their needs when planning your renovation project. Are there any specific improvements or upgrades that they have requested? Will the renovation disrupt their businesses? By considering your tenants’ needs, you can minimise disruptions and maintain positive relationships with them.

3. Get the necessary permits and approvals.

Renovation projects typically require permits and approvals from local authorities. Ensure you obtain all the necessary permits and licenses before beginning any work. Failure to do so can result in costly fines and delays.

4. Hire a reputable contractor.

Your contractor will play a critical role in the success of your renovation project. Ensure you hire a reputable contractor with experience in commercial or industrial renovations. Check their references, compliance certificates, and insurance before hiring them.

5. Create a detailed plan and schedule.

A detailed plan and schedule will help ensure that your renovation project stays on track and on budget. Work with your contractor to create a detailed plan that includes timelines, milestones, and contingencies.

6. Communicate with your tenants and stakeholders.

Communication is critical to the success of any renovation project. Keep your tenants and stakeholders informed about the renovation plans, timelines, and potential disruptions. Encourage them to ask questions and provide feedback throughout the process.

7. Focus on safety.

Safety should be a top priority during any renovation project. Ensure that your contractor follows all the necessary safety protocols and that your tenants know of potential hazards.

8. Monitor the progress and adjust as necessary.

Finally, monitor the progress of your renovation project and adjust as necessary. If you encounter unexpected challenges or delays, work with your contractor to find solutions and make adjustments to your plan.

In conclusion, planning and executing a commercial property renovation can be challenging, but it doesn’t have to be overwhelming. By following these eight tips, you can ensure that your renovation project is a success and that your property maintains its value and functionality.