Cape Town is a prime destination for businesses looking to relocate or expand. With its robust economy, highly skilled workforce, affordable operating costs, exceptional quality of life, and a business-friendly environment, the city offers an ideal setting for companies of all sizes to grow and thrive.
The city is increasingly recognised not only for its stunning landscapes and world-class wine but also for its dynamic commercial property market and emerging position as a business hub.
Over the years, the city has evolved to meet the needs of modern businesses, becoming a key player in South Africa’s economy.
An increasing number of businesses are also “semigrating,” as affluent individuals and families seek improved living conditions, better service delivery, and a healthier work-life balance.
David Arton-Powell, head of broking at Galetti, highlights that Cape Town’s commercial property market is full of opportunity despite its unique challenges. “Cape Town’s commercial property market has always had unique challenges, but it’s also packed with opportunity. What we’re seeing now is a shift in how spaces are being used and the value tenants place on travel time, location, and adaptability.”
The city’s Central Business District (CBD), once dominated by government offices, has undergone a significant transformation. Today, the CBD is a vibrant mix of business, retail, and residential spaces. “Today’s CBD is very different from what it was even 10 years ago,” said Arton-Powell. “You have creative agencies, co-working spaces, premium offices, and even lifestyle developments all within the same block.”
This change reflects a growing demand for office spaces with added amenities, like coffee shops and green spaces, to enhance employee experience.
Meanwhile, areas like Woodstock and Century City are also emerging as key business hubs. Woodstock attracts creative startups with its industrial charm, while Century City offers businesses a convenient, all-in-one solution for office, retail, and residential needs.
Cape Town’s commercial property market has had to adapt to significant shifts in how businesses operate. “We’ve seen landlords and tenants adapt in ways we couldn’t have imagined. Flexible leases, shared workspaces, and creative use of older buildings have all become part of the norm.”
This flexibility is now a key driver in the demand for office space, with businesses prioritizing adaptable spaces that align with their culture and operational needs.
Looking ahead, sustainability and technology will play a critical role in shaping Cape Town’s business environment. “Green buildings are no longer a nice-to-have; they’re becoming a must-have,” said Arton-Powell.
As businesses seek spaces that align with their sustainability values, Cape Town’s growing focus on green and energy-efficient buildings will meet this demand.
Additionally, mixed-use developments are gaining traction, integrating offices, retail, and residential spaces in one location. These developments cater to the increasing demand for urban areas that offer convenience, walkability, and a higher quality of life.
The city has also emerged as a key player in South Africa’s venture capital (VC) landscape. The Western Cape accounted for nearly half (49%) of the country’s total VC activity in 2023, with R3.28 billion in capital flowing into local startups, particularly in the tech sector. This marked the highest total investment in VC in South Africa in 14 years.
Findings by the Southern African Venture Capital and Private Equity Association (Savca) showed that capital flow to SA start-ups in 2023 reached R3.28 billion, driven by investment into local technology businesses.
Active portfolios containing Western Cape-based companies dropped marginally from 53.7% in 2022 to 49% in 2023, by value. By deal volume, it was steady at 55.6%. Cape Town’s thriving tech scene, supported by local and international investors, has earned the city the nickname “Silicon Cape.”
Gauteng, dominated by Johannesburg, was second at 30.4%, comprising 32.6% of all deals by number.
Cape Town’s appeal is further enhanced by its ability to host a wide array of prestigious events throughout the year, according to Cliff Mayinga, provincial head for Coverage Business Banking (Western Cape), Standard Bank Business and Commercial Banking.
The city’s annual influx of international and domestic visitors creates substantial opportunities for small local businesses to benefit from increased economic activity across sectors such as hospitality, logistics, catering, and tourism services.
“Cape Town’s repeated recognition on the global stage reflects its enduring charm and vibrant ecosystem. For small businesses, this acclaim, combined with the many events hosted throughout the year, offers the chance to collaborate, innovate, and contribute to broader economic activity, including much-needed job creation,” said Mayinga.
For small and medium enterprises (SMEs), Cape Town’s growing international profile provides opportunities to expand their footprint. Local entrepreneurs can develop bespoke products, establish new supply chains, and offer uniquely South African experiences that attract both tourists and investors, the lender said.
Digital banking and payment platforms also empower SME’s to operate efficiently, while tailored merchant solutions make it easier for businesses to cater to the growing influx of international and domestic visitors.
Further, working capital and trade finance solutions ensure businesses can manage cash flow during peak periods and expand into export markets.
Sector-specific financing, such as for agriculture, hospitality, and tourism, supports businesses that play a crucial role in Cape town’s economy.
Sustainability-focused financing also helps local enterprises transition to eco-friendly practices, aligning with Cape town’s reputation as a global ecotourism destination.
