Cape Town-based Property Partners said on Friday that Amdec Property Development had acquired a 50% stake in its subsidiary Southern Palace, the company that purchased Johannesburg's mixed-use precinct Melrose Arch for R1.27bn in December last year.

Amdec, also a Cape-based company, had been negotiating with Property Partners for two months before acquiring its stake for an undisclosed amount.

Property Partners said that Amdec had developed several upmarket residential, commercial, retail and golf estates in Western Cape and was the "ideal entity to bring the required knowledge, skills and resources to this joint venture".

Property Partners CEO Stuart Chait said work on new developments on Melrose Arch's 230,000m² of zoned bulk land would start in the near future.

"When we bought Melrose Arch in December, only 25% of the bulk land had been developed with 75% remaining underdeveloped. We are in a position where we feel we should conclude deals increasing our bulk take-up rate by 50%, and 75% of the bulk will be developed in the near future," said Chait.

He said that work on the planned 30,000m² shopping centre at Melrose Arch would begin next month.

"We also plan to do a 10,500m² hotel. What is integral to Melrose Arch is that it's mixed use, and in order for mixed-use development to be truly successful we feel that by immediately addressing the retail centre, residential and hotel, this will stimulate the office users," said Chait.

He said they had established that Property Partners' strategy had worked, and they were already attracting major office users out of the Sandton central business district to Melrose Arch.

Chait said with the Gautrain development going ahead, the "chaos" that would be caused in Rivonia and Oxford roads by construction would also attract office tenants to Melrose Arch.

Business Day
Publisher: I-Net Bridge
Source: I-Net Bridge