The Cape Town Partnership - the company formed by the Cape Town city government, business and property owners to help develop the city - says property owners and investors stand poised to accelerate spending on upgrades, refurbishments and new developments in Cape Town's central business district (CBD) as a result of the incentives announced on Wednesday by Finance Minister Trevor Manuel.

As part of the government's 2003-04 budget, Manuel announced tax breaks for investors in urban areas across South Africa, under which taxpayers refurbishing a building will receive a 20% straight-line depreciation allowance over a 5-year period, while construction of new buildings will receive a 20% write-off in the first year and 5% a year for a further 16 years.

This benefit would be available to owners as users of the building or as lessors/financiers of these investments.

Commenting on the new measures, Partnership CEO Michael Farr said: "As a result of the Minister's announcement, we are expecting increased investor interest in property development opportunities as well as what we hope will be a surge in interest from property owners who are now incentivised to refurbish their properties.

"The Partnership will be contacting potential investors with whom it has already held discussions on investment opportunities in the Cape Town CBD to bring these particular incentives to their attention.

"We are sure that they will respond positively to this news and that we will soon see an upswing in capital investment in both new projects and the upgrading of existing buildings".

Farr added that since mid-1999 investors had already shown their faith in the Central City by spending some R3.4-billion for the period ending December 2002.

Furthermore, Farr said: "It could be seen as an endorsement by National Government of the commitment being shown by local government throughout South Africa to the renewal and revitalisation of the country's CBDs.

"In the case of Cape Town, our local government, since 1999 when the Cape Town Partnership was established, has shown a very focused commitment to the revitalisation of the Cape Town CBD and much progress has already been made in this regard."

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