Moving North

Moving North

Original Source: The Ridge

Development on the KZN North Coast is charging ahead faster than ever imagined setting the foundations for a massive boost to our economy, writes Greg Arde.

Development along the North Coast of KZN has been charging ahead at pace, and rightly so. Since the airport was relocated and new management has been in place at Dube TradePort (DTP), we’ve started to taste the fruits of the boom – and hopefully, public sector investments of billions into airport and DTP will be harvested for years to come.

But, this story is not complete without a vivid image of energetic young Durban developer Charles Thompson clambering up, down and around the first phases of an R4-billion property gem, he is developing at Sibaya. He was talking faster than he was moving or perspiring, and that’s saying something. We met on a sweltering summer’s day and he darted around faster than the Guptas fled South Africa.

Forgive the gush, but Thompson’s Sibaya development is brilliant. I’m generally enthusiastic about new builds in KwaZulu-Natal, but the views and the offering in the new Sibaya precinct are splendid – and I walked around it when it was a shambolic building site, marveling at the lucky sods who got in and bought early.

Backed by investors including the Paruk family (of Coventry Clothing fame) and a Botswana based financier, he has sunk hundreds of millions into the first two of three phases. And in May there will be a site handover to 260 buyers of Ocean Dune, a three-storey complex that will surely win design awards.

Thompson tells a remarkable tale of how buyers almost fell over themselves to get into Ocean Dune – a build that is alone worth R4-billion, is in three stages and is to be completed in two years. Apartments just shy of 100m² sold off plan for R2,5-million in November 2016. Since then there have been 10 resales at R3,5-million by people who lodged a 10% deposit and then made a tidy R1-million profit.

The Sibaya complex includes a retail component and other developments. One is being done by FWJK – a pioneer uMhlanga developer, and there is also Shoreline Sibaya, a retirement offering that has enjoyed R300-million or 50% of sales in the six months since being launched.

The North Coast is mushrooming and has been for a while. Elan, the group that developed Simbithi, built 2 000 houses there, 1 200 apartments, and 800 freehold houses. Only 350 housing opportunities still remain – 14 years after it was started.

In Simbithi alone there is R5-billion worth in private house build and R1-billion in infrastructure. In 2015 Cobus Oelofse, ilembe Chamber of Commerce CEO said there were 14 estates under construction in ilembe, with a planned 1 000 houses.

Elan’s Andrew Thompson says there is keen interest in the North Coast. “We still need cultural villages, theme parks, a proper beachfront, schools, universities, and sports facilities.”

But the absence of all this and the wavering business sentiment isn’t stopping development. Stuart Graham, the developer of a Birdhaven boutique estate in Sheffield, says nine of his 18 plots have sold and the recent uptick in business optimism has led to a slew of enquiries. The cheapest plot left is 900m² and is on the market for R1,4-million.

“Things are picking up. We are getting a lot more enquiries, especially from Cape Town and Joburg, from people who used to live here but left for business. Now thanks to the airport and the easing of getting around the country to do business, they are wanting to relocate.”

The newly appointed Commercial Head for Tongaat Hulett Developments, Chris du Toit – in the process of relocating from Gauteng – recently raved about developments, particularly Sibaya and north along the coast.

“It is mind-blowing what is happening here, which is why Gautengers flock to uMhlanga, Ballito and Zimbali at every opportunity. Even though there are Johannesburg based consultants and bankers who know what is happening here, the general (South African) market remains uninformed.”

Hamish Erskine, CEO of Dube TradePort says the first phase of Dube Trade Port is becoming the heart of the burgeoning master planned precinct that will ultimately encompass Dube TradePort’s current 3 OOOha landholdings and which will see a host of integrated modern infrastructure being rolled out over the next 50 years, building links that will propel further growth and development in the region.

Dube TradePort is attracting new private sector investment, spurring export-oriented manufacturing and facilitating tourism and business travel. “The surge in development on the North Coast, coupled with the plans for the next 10 years, paints a very exciting picture.”

Erskine says Dube TradePort has secured R1,5-billion in private sector investment and has a promised pipeline of R4,2-billion more. Businesses that have already made Dube TradePort their home range from Samsung SA producing TVs, Yangtze Optics Africa Cable manufacturing fibre optic cable, and DB Schenker, a worldwide logistics and freight service provider. There are also local businesses like Laser Junction and iDube Cold Storage, Tufbag SA, Amsted Reelin and a host of freight forwarders and shippers in a facility adjacent to the Dube Cargo Terminal. *

* PROPERTY UPBEAT

Olivia Roets-Sak whose Royal Palm Property Holdings owns Palm Lakes, has a marvelous story to tell. The estate was launched in 2005 and now has 765 finished units. including 371 full title and 302 sectional titles and almost 100 units in the retirement village. This has involved an infrastructural spend of R400-million and private sector build of R2.5-billion.

Palm Lakes owns 700 hectares and has developed half of that still on the cards is 120 hectares allocated to an equestrian estate comprising 90 freehold stands of between 2 000 and 16 000m².

Olivia says property demand is still rising and Palm Lakes offers variety. “We sell plots, apartments, free-standing sectional title, and free-standing homes at prices that vary between R600 000 and RSA-million.”

Palm Lakes recently launched sites for sub-developers and sold R170-million in land in two months, which it expects will eventually bring another 600 houses and apartments to the market Olivia says the region needs a beach resort better beach facilities like showers, toilets, beach security and parking. “Coming from Europe, I find it very sad that the land next to the beach is most residential developments. We need beach promenades stretching for kilometers. where the population can walk/cycle and socialise. Having the international airport on our doorstep is fantastic, but now we need to attract international visitors. “We have a lot of amazing golf courses. If this could be combined with fantastic beach facilities. A big 5 safari resort within an hour’s drive, and a natural park (indigenous forest) for walking and cycling.

This place would be almost perfect. Last but not least, hotels and B&B’s need to review their price point. For international visitors, SA is not exactly cheap. Having said all this, things are progressing very well.”

*BUSINESS CONFIDENCE

While we’re all justifiably amped by the property boon, the most recent business confidence survey done by the ilembe Chamber of Commerce. Industry and Tourism and Enterprise ilembe say business confidence is at an all-time low since it was first measured in 2015. The bi-annual index is a hybrid derived from business surveys in ilembe with a weighted index of financial and economic variables. The index at the end of 2017 was 42.7 index points, “entrenching itself firmly in negative territory-below the neutral level of 50 index points.” according to the Chamber. With regards to business confidence per economic sector, the Manufacturing and Assembly Sector featured for the first time as the most confident economic sector, replacing Tourism, Catering, Accommodation, and Property Management which moved to the third most confident economic sector after Construction, Property Development and Property Sales.

It is also interesting to see almost 60% levels of optimism in manufacturing, transport and warehousing and in the remaining sectors like finance, more businesses were upbeat than downcast Holiday occupancy levels were above 70%, and the survey was done when the Gupta’s favourite politician was still Number One and general confidence levels were down, credit rating agencies looked at South Africa with thin-lipped, snide contempt and all was not rosy in the land.

ilembe Chamber of Commerce CEO Cobus Oelofse has 350 members and his region includes 600 000 people. The big money generators in the area are tourism, properly and construction and manufacturing (in lsithebe, for example, Whirlpool makes 700 000 fridges and freezers a year).

Oelofse is upbeat – and there are challenges. Security around electrical supply in the region is struggling to keep pace with growth. “But on the whole the region’s prospects are incredibly positive. There are complaints about the standards of service in the hospitality sector, that there is too much competition in retail and that slow service delivery is hampering development. All this needs to be addressed, but these are signs of a growing economy and we have significant players in this region. so we have to build on these successes,” Oelefse says.




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