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Wednesday Mar 05, 2014

Billions to be invested in V&A residential property

Between R3 billion and R4bn is to be invested in the Victoria & Alfred Waterfront in Cape Town over the next three to four years, much of it in residential apartments.

The investment will be made by property company Growthpoint and the Public Investment Corporation (PIC), which jointly acquired the Waterfront in June 2011 for R9.7bn.

Norbert Sasse, the Growthpoint chief executive, said yesterday there was still about 200 000m² of undeveloped bulk at the Waterfront, of which about half had been earmarked for residential developments.

He said the planned investment over the next three to five years would result in the development of about 40 percent of the undeveloped bulk in the node. The focus would be on a R500 million project to redevelop the grain silos into the Zeitz Museum of Contemporary Art Africa.

A high-end boutique hotel and restaurant would be linked to the museum, which was scheduled to open in 2016 and would display the art collection of former Puma chief executive and chairman Jochen Zeitz.

Sasse said the retail masterplan for the Waterfront was being finalised, with about 20 000m² of additional retail to be established around the existing Victoria Wharf.

A process was also under way to attract new corporate head offices, with one project already secured. There was also potential for a three-star hotel in the node.

But Sasse said residential property, particularly for letting, would become a big component of the Waterfront.

'We sit with a dilemma in that [we have] probably the most valuable land in the country, if not on the continent, and we don't necessarily want to sell it,' he said.

Growthpoint is converting one of two buildings vacated by investment manager Allan Gray into 200 studio to twobedroom apartments for rental. A further 166 studio to threebedroom apartments are being developed on top of the breakwater garage.

Sasse said this was part of a deliberate strategy to bring more people into the Waterfront to 'live, work, play, eat, drink and gym'.

These apartments would become available within the next six to 12 months, with rentals ranging from R5 500 to R25 000 a month.

Sasse said the reasons for the conversion of the office building to residential apartments were the desire to get more people to live in the Waterfront, the better returns it could get by converting it into residential rather than A-grade offices, and the fact that it was not in a primary office node.

He said the Marina residential development comprised about 550 apartments but about 40 percent stood vacant for all except for about two months a year because they were owned by foreign investors.

A further 33 apartments were built adjacent to the former Allan Gray head office building, with all but one sold.

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