Property upswing anticipated for PE

14 Aug 2007

Port Elizabeth is in the throes of much activity, all of which appears very promising for its property market.

Property economist Francois Viruly of Viruly Consulting, said Port Elizabeth's property market is in for substantial growth. "I'm taking the view that the Port Elizabeths and Nelspruits of this world will see substantial growth," he says.

"There's more and more buying power in smaller town South Africa."

This view is confirmed by real estate group RE/MAX, which has opened RE/MAX Independent Commercial in Port Elizabeth to meet business opportunity as a result of all the investors and developers flocking there for land at affordable prices.

In addition, Port Elizabeth's Nelson Mandela Bay received extensive attention from national and international property developers after the calls for Expressions of Interest (EOI) in developing an International Convention Centre (ICC) were advertised recently. The calls were focused on attracting interest from developers in South Africa, the Middle East and Asia.

Effectively the development of a 1 000-seater international conference centre with international state-of-the-art facilities at an estimated cost of R500m is expected to change the face of the city.

The Mandela Bay Development Agency (MBDA), a development arm of the Nelson Mandela Bay Municipality (NMBM), which is tasked with revitalising the Port Elizabeth central business district (CBD) and inner city, is overseeing the project.

Biks Ndoni, Port Elizabeth's deputy executive mayor, said the ICC has been investigated by the NMBM, which has taken a decision to implement the project as a priority because of its synergies with other developments and its inherent tourism potential.

Parcels of land in the city which have ICC potential have been identified as Humerail, Summerstand Sixth Army Base, Telkom Park Stadium in Humewood, Kings Beach and Madiba Bay Leisure Park.

Developers have until October 2007 to submit their proposals.

Gillian Saunders, a tourism, hospitality and leisure expert at Grant Thornton International's Johannesburg office and who is also responsible for the feasibility study on the proposed ICC, said Port Elizabeth has turned the corner in terms of a desirable place both residentially and with regards to tourism. However, she points out that it needs a boost to give it the impetus for the uphill climb.

"This will come in the form of investment in the region," she says.

"Port Elizabeth should top the list of South African secondary cites and it can become a mega-city if it carries out the mandate of the MBDA to revitalize the city centre and surrounds and to implement projects such as the ICC."

Inner-city revitalisation consultant John Fraser from Urban Inc said if a structured strategy is in place Port Elizabeth may be able to achieve a turnaround like Johannesburg's, and more quickly as it is smaller. - Ingrid Smit

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