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Development worth R3.5bn planned for Cape Town CBD

09 Jun 2015

Much has been written in the media over the past year about the success of the Cape Town CBD, so much so that it’s being touted as an ‘overnight success story’, with developments of nearly R3.5 billion in the pipeline. 

The new confirmed investments include a R70 million upgrade by the Department of Public Works to the Master of the High Court building in Albertus Street.

This is according to Rob Kane, Chairperson of the Cape Town Central City Improvement District (CCID), who says people are asking why the CBD is suddenly so popular. “Why are we suddenly seeing so much investment happening here and why, now, do so many people want to come to live here?” 

Kane says the overnight success is one that’s been 15 years in the making. In November this year, the CCID will celebrate 15 years in operation, while its next five-year business plan begins on 1 July. 

Thanking the CCID’s partners at the City of Cape Town, and Central City property owners for the confidence they had shown in the area, Kane says he felt that they’ve laid a solid foundation over the past decade and a half, and now investors are voting for the CBD with their rands, and developments are rising from this foundation. 

At the CCID’s last business breakfast, held in 2014 in the then newly opened Portside building, an attempt had been made to predict how the skyline of the CBD would continue to change over the course of the next five years. But this was something quite difficult to do, he says, because investment and development are truly catalysing the Cape Town CBD. 

“They are enabling us to transform, and what’s happening in the CBD today really is akin to the science of chemistry, the bringing together of elements that together form a reaction far greater than the sum of their parts.” 

Each year, the CCID publishes a guide, “The State of Cape Town Central City Report”, which looks back at the previous year in terms of assessing the economic climate of the CBD. 

Kane says at this event a year ago they had just released the 2013 report, and noted that the value of property in the CBD, according to the City’s official property valuations for the 2013/14 financial year, stood at around R24 billion. 

It was also noted at the time that, in addition to this R24 billion and the R1.6 billion Portside building that had just opened, there was approximately another R3.4 billion in the pipeline, somewhere between construction and planning, to come online within the next five years. 

However, while compiling the latest report (2014: A year in review) the CCID’s research team documented a further R1.46 billion worth of development underway or on the cards. 

“And astonishingly, between the release of the 2014 report and today, we now have conservatively seen another R1.95 billion of investment that has been announced in just the past three months. I say ‘conservatively’ as there are some investments and refurbishments whose figures we have not yet been revealed by developers.” 

The new confirmed investments included:

  • A R70 million upgrade by the Department of Public Works to the Master of the High Court building in Albertus Street.
  • A new R200 million residential development called The Sentinel on the corner of Loop and Leeuwen streets being developed by the Nova Group in association with the Dogon Group
  • Tsogo Sun’s development of the SunSquare and StayEasy hotels on the site of the old Tulip Hotel in Bree Street, totalling R680 million. 
  • The transformation of the old Triangle House in Riebeek Street into a R1 billon residential and hotel development, a collaboration announced by Radisson and Signatura just last week, to be opened by September next year. 

According to Kane, a year ago they predicted that residential property would be the new wave of development, and they are thrilled in particular to see this happening as demand has significantly now outstripped supply in the Central City. 

They think that people wanting to live here and be closer to their places of work and play is the biggest thumbs up any CBD can receive in terms of catalysing a downtown area. 

“Add to this the growing accolades we are receiving as a city in which to do business, and we are reminded how important a strong CBD is for the metropole as a whole.” 

The third annual edition in a series of reports on the economic climate of the CBD, the latest, The State of Cape Town Central City Report: 2014 - A year in review, is available either from the offices of the CCID or online via the CCID’s website.

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