Business Day Reporter

SOUTH African property group Corovest has been awarded a R2bn retail redevelopment project in the Welsh city of Newport — its biggest development project in the UK to date.

Corovest will draw on its experience in SA, where the group was involved in the development of Fourways Crossing and Hyde Park Shopping Centre in Johannesburg.

The group hopes to break ground next year and will complete the project ahead of the 2010 Ryder Cup, which will take place in Newport.

The contract for the 40000m² redevelopment was awarded last week to a consortium headed by Corovest International, which has formed a partnership with UK company Modus Properties.

Corovest SA’s initial thrust into the UK property market was the acquisition of 25% of the R2,5bn Sapphire retail portfolio six years ago. The stake in Sapphire has subsequently been sold at a 40% profit to shareholders.

Mike Watters, CE of Corovest International and former MD of South African-listed property company Corovest Property Group, said he was elated at the achievement, which came after six years of active participation in the UK development and investment market.

“It takes that long to get established and be accepted. At this point we can exert our influence in an area in which we are well qualified,” he said.

The £200m facelift for the 4ha site in Newport will create hundreds of jobs in the city, and attract high profile retailers. The 40000m² of new and refurbished retail space will include a major new department store, improved car parking facilities for 1400 cars, pedestrian priority areas, enhanced public spaces, new cafes, restaurants and bars, together with 137 residential units.

As the gateway between England and Wales, Newport has one of the largest complexes of championship golf in Europe and is an appropriate site for the 2010 Ryder Cup, says Watters, but the city has lagged behind similar centres in terms of development.

A key feature of the development will be to bring together Newport’s riverfront and commercial centre, allowing people to walk easily between the two.

Historically, Newport has underperformed in the retail stakes for a city of its size. The new scheme should turn the city’s retail fortunes around.

Corovest owns a 5000m² parcel of properties in the development, which it bought for R150m. “So we were already fundamentally involved,” said Watters.

News of the contract has been applauded by the South African retail property industry.

“South African retail developments are among the best in the world and it is heartening to know that the export of our expertise is taking place at such a high level,” said George Skinner, executive director of the South African Council of Shopping Centres.