A HUGE R700m mixed-use development is to be constructed at Century City, in Cape Town. It will be the largest to be built at the mixed-use precinct since the Canal Walk Shopping Centre was completed in 2000.

Called Crystal Towers, the development will include an 180 room five-star hotel, associated boutique restaurants and retailing, 90 luxury apartments and 7000m² of office space. It will be rolled out in phases.

Financed by Nedbank, it is being undertaken by the Rabie Property Group and is on the Grand Canal across from Canal Walk.

Although economic and property conditions are difficult, property pundits say upmarket mixed-use precincts such as Century City and Johannesburg’s Melrose Arch remain attractive to tenants and developers, whether times are good or bad.

David Green, MD of commercial and industrial property brokers Pace Property Group, says the stronger and established nodes in SA such as Melrose Arch, Canal Walk and Century City, the Gateway precinct in Durban, and Sandton in Johannesburg, remain “very strong and attractive to tenants and developers alike” because they offer everything tenants want, such as good access, quality accommodation and well-established business nodes offering retail, office and residential capacity.

“These are the developments that are more likely to attract users and developers than other less established

Property economist Francois Viruly, of Viruly Consulting, says the market is increasingly starting to see shopping centres becoming mixed-use nodes that offer retailing, residential space and hotels. “These environments are starting to reflect a trend of combining home, work and play. We’ve seen it at Melrose Arch. It is becoming increasingly tempting to put hotels close to other amenities.”

He says the run-up to the 2010 Soccer World Cup will increase demand for hotel space. The teams participating will also be looking for accommodation.

“I think there is renewed interest in hotel development and if we look ahead to the next 12 months, possibly instead of extending or focusing on the retail sector some developers will rather look at opportunities in the hotel sector.”

The new hotel in Crystal Towers will be part of the Protea Hotels group’s African Pride collection of “superior deluxe” five-star hotels.

Rabie Property Group director Greg Deans says the scheme is being delivered to “satisfy what the market is generally perceiving as major leisure demand with the Soccer World Cup 2010 as the major catalyst”.

“Added to that we have modelled this precinct on the five-star specification. It is primarily a business hotel aimed at the business user and has extensive business facilities,” says Deans.

“In terms of the localised market, it is aimed very much at the business traveller because by the opening of the hotel we will have 350000m² of offices in total at Century City, which includes a lot of major international and national brands. There is a local demand we are responding to and we believe the big kicker for this development will be the international exposure SA will receive as a direct result of the World Cup.”

Deans says office vacancies are extremely low at Century City. Excluding new developments, the figure is less than 5%.

Crystal Towers will include two tower blocks and a standalone office block and will be set over a two-level podium consisting of parking and canal-fronting hotel banqueting facilities. The rest of the hotel will be housed in one of the nine-storey towers.

The hotel will provide conference and meeting rooms, a business centre, restaurants, swimming pools, a gym and spa. The retail component will offer boutiques and restaurants and will run through the spine of the development, linking up with the apartments, offices and hotel.

The second tower will include 2000m² of offices over two levels and seven storeys of luxury apartments ranging from studio to two bedroom penthouses.

The apartments will be sold on sectional title and are aimed at owner-occupiers and long-stay business travellers.

A pedestrian bridge will link the development to the Canal Walk side of the Grand Canal.

Construction has started with the hotel expected to be completed in November next year. The apartment tower and office block are scheduled to be completed in phases from early 2010.

Source: Business Day