By Pauline Larsen

The 160 ha Riverhorse Valley business estate, north of Durban, is reaping the fruits of the industrial property boom.

Developer Moreland says it expects to sell out by the end of next year and that eventual total investment should top R2bn. 

"We could have sold the available land two or three times over," says Riverhorse Valley project manager Gerald Waller. 

He adds that the industrial land "was just sitting" for about three or four years, until 2003, when the market went into overdrive. 

The estate, 3 km from the Umgeni River, is an innovative joint venture between Moreland, the property arm of the Tongaat-Hulett group, and the eThekweni municipality.  "The land was sold to the city by Tongaat-Hulett in terms of a joint venture agreement," explains Waller. 

Part of the agreement is that the city is funding a link highway that runs through the estate, between the North Coast Road and KwaMashu off ramps. A new Riverhorse Valley interchange has already been provided through municipal infrastructure investment.  Development at Riverhorse kicked off in mid-2002 and, to date, 45 land sales have been concluded, equivalent to 76 ha of development. Among the blue-chip occupiers are Bidvest, Mercedes Trucking and Agfa. 

With serviced industrial land fetching between R245/m² and R310/m², prices remain reasonable, especially compared with prime nodes in the Western Cape and Gauteng. The Western Cape has reported a top land price of R600/m² in recent months. The most expensive node in Johannesburg has hurdled R425/m². 

Today, 75% of Riverhorse is sold out. Light industrial is the dominant use, but offices are also being built. Waller says all development is done with due regard for the environment.  "We originally projected that the land would sell over 10 years," he says. "But we've had to halve our estimates to five years." 

Moreland forecasts that the estate will be fully sold out by the end of 2006, though some development will spill over into 2007.  Demand is interestingly varied. Waller says large land parcels were snapped up by Gauteng-based companies early on in the sales cycle.

But he adds that there has also been strong demand for smaller erven of between 5 000 m² and 6 000 m².  In addition to the 160 ha dedicated to the business estate, 142 ha will be retained as part of the city's open-space system.