Cape developers running short of coastal res land

Posted On Wednesday, 23 May 2001 03:01 Published by
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WHILE certain of the smaller property developers in the Western Cape, particularly those who borrow to buy their land stock

WHILE certain of the smaller property developers in the Western Cape, particularly those who borrow to buy their land stock, are suffering and could go under in the year ahead, many of the larger, more experienced developers, who are traditionally more conservative in their approach, are now very short of land for development, reports Steyn Rivett-Carnac, Chief Executive of South Cape Trust and Ovdeco.
"Because of the fluctuations in the market and the high interest costs (in relation to those charged, say, in Europe and USA), all the more experienced developers in the last few years have been opting for developments where a quick start up and reasonably fast sales are possible. Most of us these days distrust the old idea of "banking in land" and have avoided doing this, but the net result is that many companies, including my own, are now in need of more ground to develop."
Mr Rivett-Carnac said that most major developers are conducting campaigns to make contact with property owners, other developers and trustees of insolvent estates, all of whom may need help from those with resources greater than their own. He himself, he said, is particularly interested in coastal properties or property in towns such as Vredenburg, which are close to the coast. In most cases, he added, he would want the current owner or developer to have gained approval for subdivision, even though this may not yet have been granted.
"There are always economies of scale possible in the large projects (those with 50 to 150 erven) and these, therefore, are the ideal proposition for the developer of our size, but we can - and often do - take an interest in developments as small as five or ten erven."
South Cape Trust and its related companies, said Mr Rivett-Carnac, have developed coastal property from Saldanha Bay to areas north of East London. At the moment, however, stocks are so low that they have only two erven left to sell in Vredenburg, two at St Francis Bay, five in Mossel Bay and two in Knysna.
"All of these have been fast selling developments," said Mr Rivett-Carnac, "and those buying into them as we approach sellout point are making an extremely good investment. We must, however, find land to keep an operation that has now been going for 35 years trading at a good level. We would, therefore, welcome contacts from any person with property on the South African coastline."

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