[Cape Town, 12 May 2003]  After months of negotiations, an Irish investment consortium led by top Irish property group Howard Holdings plc has secured the famous “Lady of Wale Street” – the former BOE Headquarters, in a deal confirmed on Friday with Nedcor. The full deal includes the purchase of seven buildings in the St Georges Mall/Wale Street area, all belonging to Nedcor.

This follows closely on the visit of an Irish trade delegation led by Michael Ahern, TD, Minister for International Trade, Department of Enterprise Trade and Employment, which was in the Mother City on Friday.

In terms of the deal, the consortium has agreed the purchase price with Nedcor and has already commenced a three-month due diligence process. Plans for the seven buildings, which occupy a full city block in downtown historic Cape Town, will be shortly submitted to authorities for planning approval.

The Cape Town Partnership has played a key role in the introduction of this foreign investment to Cape Town, and has spent the past eight months assisting Howard Holdings with information on investment opportunities, tax incentives, the property market and potential for leisure and retail investment in the Cape Town CBD. Howard Holdings already own one other property in Cape Town.

Although financial details of the deal and the urban renewal upgrade will only be released once planning approval is secured, early indications are that it will be worth in excess of R350-million and will include a premier international brand six star hotel, residential apartments, top class international retail and some premium commercial space. It will constitute one of the largest private sector inner-city renewal projects in South Africa in the past few years.

Frank Gormley, Howard Holdings plc Chairman, said that such was his confidence in Cape Town that a new company, Eurocape Investments Limited, had been established to focus particularly on investment and development opportunities in Cape Town. Mr Cormac Magennity had recently been appointed as CEO of the company and would be based in both Cape Town and Dublin. Eurocape has plans to build up a substantial portfolio in the Cape Town region and has already been active in the market place.

Said Gormley: “I have visited Cape Town many times and have been very impressed by what has been a remarkable turnaround in the CBD.

“We have had a great deal of experience and success in investing in property redevelopments in CBDs of cities that have blossomed as a result of urban renewal and we are absolutely committed to this project. Dublin’s own project, the Temple Bar district, has achieved spectacular success in urban renewal, and Cape Town is showing every sign that it will be one of the world’s finest.

“We are very excited about this project and about furthering Irish-South African business.”

Partnership CEO Michael Farr said he was “absolutely delighted” that not only would this be the largest private sector inner city renewal project in Cape Town’s history, but that foreign investors had shown such a high degree of confidence.

“We have experienced over R5-billion worth of investment in our CBD since the Partnership started its work in mid-1999, 88% of which has been domestic fixed investment. This deal is really the best possible news for our central city, and proves substantively that our urban renewal efforts have not only been successful, but are gaining in momentum. 

“Based on early projections, a redevelopment of this nature and at this value will sustain about 2000 jobs in construction and create about another 4000 indirect jobs.

“We were approached by Frank Gormley last year and based on a tour of the CBD, they expressed interest in the BOE, Old Reserve Bank and Cape of Good Hope Bank buildings. We then referred them to Nedcor, the owners of both these and surrounding properties.

“The negotiations between these two parties have been ongoing and we know of a number of other investors who had also been interested in the BOE building and its redevelopment. The fact that there was clearly a high degree of competitive bidding for this property in particular illustrates very clearly that interest in the Cape Town CBD is really at an all time high.

“We are thrilled that a company such as Howard Holdings and its investment partners, with its extensive experience in urban renewal throughout Europe, has secured not only the BOE building, but all seven buildings in the area. This is really the most exciting project looking forward.”

“What has also been extremely helpful is the range of tax incentives recently announced by Minister Manuel, and we are looking forward to a continued focus on redevelopment of our inner city. Howard Holdings in particular has extensive experience in innovative tax related urban renewal schemes, and they believe that the tax incentives announced recently will have a major impact. Special tax incentives, including ones similar to this, have completely transformed the Irish economy.”

Howard Holdings has offices in London, Dublin and Cork and over EURO 400-million (over R3.5-billion) worth of property under development, spanning both commercial and residential projects.

The company specialises in joint ventures with public and private bodies, companies and individuals. As well as an emphasis on mainstream commercial and residential property, they also focus on niche opportunities, including parking, healthcare and education.

The company is particularly active in the South East of England, and invests in the prime areas of Greater London. New developments include substantial mixed residential and commercial projects in Kingston, Teddington, Harrow and Croydon. New development schemes have commenced in Cork, Waterford and Dublin in Ireland.

In the Cork Docklands area, Howard Holdings has commenced construction of a EURO 100-million office and hotel development at Lapp’s Quay. The hotel will be completed by December 2004, in time for when Cork hosts the European Capital of Culture. The Howard Holdings development is the first of a total redevelopment of the Docklands area, which will continue over the next 15 years under the management of the Cork City Council.