In what will be the first major inner-city development in South Africa for a black economic empowerment group, South Africa’s Coessa Holdings — acting in partnership with Johannesburg businessman Wandila Mtolana — plans to develop a new, R390-million residential, commercial and retail lifestyle centre in Cape Town, to be known as Icon.
The centre, to be marketed by Seeff properties, will be situated on a currently vacant 4Â 000 square metre site (site of the old power station) in the Foreshore area of the city’s central business district, adjacent to the new Investec head office building and very near the Cape Town International Convention Centre, as well as the Victoria & Alfred (V&A) Waterfront.
It will comprise 24Â 000 square metres of space, of which 3Â 000 square metres will be devoted to retail space, 5Â 000 square metres to office space and the balance to apartments.
Launching the new centre in Cape Town on Wednesday, Seeff managing director for the city bowl area Ian Slot said that the residential component will consist of three apartment blocks, of which two will be 18 storeys high and the third nine storeys high. A total of 176 apartments will be on offer, ranging from 55 square metres to 156 square metres in size and priced from a minimum of R995Â 000 rand (including VAT, transfer duty and parking) to as much as R5,7-million rand for the penthouse — equivalent to R25Â 000 a square metre.
Apartments on offer at the V&A Waterfront are currently selling at more than R40Â 000 a square metre.
The ground floor of the Icon complex will offer retail space for boutique shops and restaurants, with the first to third floors designed for office space. Secure undercover parking will be provided in a two-level basement as well as upper-level parking on four floors.
Coessa Holdings director Shabodien Roomanay said that as part of the group’s commitment to empowerment it has pledged to set up a trust to which it will donate a share of the company’s profits from the project to be used for the construction of housing for previously disadvantaged individuals, among other empowerment uses.
Coessa will contribute a flat R1-million to the trust up front, as well as 20% of the difference between a baseline of R17Â 000 per square metre and any price achieved above this level.
A tender for the construction of the complex is expected to be launched in August and construction is scheduled to begin in November and last for 18 months, thus making Icon ready for occupancy in about June 2006.
Andrew Boraine, head of the Cape Town Partnership, said the new development is in line with the partnership’s goals of attracting residents back to the central business district and bringing 24-hour life back to the city by offering a space for new shops, residences and other activities. It also meets the group’s aim of getting developers to put back something into the city on a social development basis.
Western Cape Premier Ebrahim Rasool added that the new development will be on previously derelict ground and will therefore add substantial investment value to the area, as well as attracting new businesses and residents to the city.
According to Slot, the Icon centre is not just another of many new property developments unveiled for the Cape Town city centre over the past year.
Rather, due to its position near the Waterfront and the convention centre, it can offer attractive long-term rental and rental pool opportunities for investors.
“The International Convention Centre is already booked for a considerable time to come, while the Waterfront is the most visited tourist destination in Africa,” he noted. “This positions Icon in a unique rental environment.”
He said that according to conservative rental pool projections, an investor could expect a net return of 7,37% on an investment after one year with an occupancy level of only 50%. The net return would increase to 9,11% in the second year with a 55% occupancy level and to 14,59% in year four with 70% occupancy. — I-Net Bridge