Developers Fundamentum Property Group and JSE-listed Tongaat Hulett finally broke floor on Westown, a new mixed-use mini city west of Durban in KwaZulu-Natal (KZN), with a ceremonial sod-turning on Thursday, nearly 4 years after they introduced plans for the preliminary growth.
The multi-billion-rand growth deliberate for land underneath sugarcane fields in Shongweni might be anchored by Westown Square – a “high street” buying centre anticipated to have a R1.3 billion price ticket.
Westown Square might be surrounded by medium-to-high-density residential developments, a college, personal hospital, workplace buildings in addition to warehousing and logistics capability that’s anticipated to be the midway home for truck drivers en route to Johannesburg.
Shoprite Group will anchor the retail centre with a flagship Checkers Hyper new technology retailer, whereas Woolworths would be the different key anchor.
Infrastructure rollout
Infrastructure growth for the mega-project might be first on the listing for builders, with the primary part focusing on an improve of Kassier Road – between Alverstone Road and MR559 – to a two-by-two lane with medians and sidewalks.
The highway work – which is ready to formally begin development in September – will happen in tandem with the development of the 45 000m² buying centre.
Westown is being pushed by Durban-based Fundamentum, a non-public property group invested in KZN and Gauteng that was based by Carlos Correia, a seasoned property developer and former director of JSE-listed Vukile Property Fund.
Correia has secured backing for the event from Durban tycoons, brothers Sean and Don Bergsma – the duo behind The Ignition Group and Impresa Capital, which just lately purchased out Gumtree’s Southern Africa enterprise from eBay-linked Adevinta.
The Bergsma brothers at the moment are shareholders in Fundamentum, with Sean Bergsma on the group’s board.
Read: Exclusive: Durban enterprise capitalists purchase Gumtree SA from eBay-linked Adevinta
“Fundamentum is committed to changing the tide on developments of this nature, by leading a mixed-use urban sustainability agenda at Westown – inclusive, environmentally sustainable, high-energy, safe and secure,” says Correia.
“Westown is a new place – the new City of the West. A ground-breaking, locally-driven initiative that connects people with spaces and experiences, bringing new opportunities to live, work and thrive,” provides Correia.
“Now that the first tender for the upgrade of Kassier Road has been awarded to a stellar local development team, including contractors Stefanutti Stocks and engineering consultants SMEC South Africa, we are eager to get moving,” he says.
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Fundamentum has secured a leasehold deal on a big a part of the land in Shongweni, owned by JSE-listed Tongaat Hulett. Image: Supplied
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Westown might be situated on Tongaat Hulett’s sugarcane land in Shongweni, between Durban and Pietermaritzburg. Image: Supplied
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An artist’s impression of Westown Square, the R1.3bn ‘high-street’ retail centre being developed by Fundamentum that may anchor the Westown mega-development, west of Durban. Image: Supplied
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Artist impressions of what Westown’s retail element is probably going to appear like when full. Image: Supplied
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Artist impressions of Westown’s retail element. Image: Supplied
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Artist impressions of Westown’s retail element. Image: Supplied
Ownership
The Westown growth is modelled on Johannesburg’s Waterfall City in Midrand, which is being pushed by JSE-listed Attacq, on land owned by the Mia household.
As builders of Westown, Fundamentum has obtained growth rights of round 517 000m² of bulk at Shongweni, by means of a rolling 99-year leasehold settlement with landowners Tongaat Hulett.
This deal is a optimistic transfer for debt-laden sugar and property firm Tongaat Hulett, as it would retain possession of the land and obtain rental revenue from industrial finish customers – raking in additional revenue than what the outdated sugarcane fields would have generated.
Durban-headquartered Tongaat Hulett has battled monetary struggles in the previous few years, with the corporate registering two suspensions from the JSE since 2019, due largely to an accounting scandal implicating former executives a number of years in the past.
The group’s monetary woes, in addition to the disruption attributable to the Covid-19 pandemic in 2020, performed a giant function within the nearly four-year delay on development round what was as soon as often called the Ntshongweni Urban Development.
Read: Tongaat Hulett to kick off R30bn Ntshongweni growth [Oct 2018]
Unlocking Tongaat Hulett land
This delay, in accordance to Correia, necessitated many journeys again to the drafting board and negotiating desk for Fundamentum.
Questioned in regards to the land leasehold deal, Tongaat Hulett chief enterprise transformation officer Dan Marokane informed Moneyweb that “this is the first such land lease” the group has concluded.
“[It comes] post the review of our strategy to unlock value out of our land in a manner that increases [the] ultimate value realised in comparison to outright land disposals. We have since embarked on another land lease which we will announce quite soon,” he famous.
“It is our stated strategy to explore, to the extent possible, land development opportunities that allow annuity income rather than outright land disposals, along the lines of what is being done in Gauteng’s Waterfall area,” he added.
“The Westown development entails some R900 million of infrastructure to enable the more than 500 000m² of development, which will include a regional mall development by Fundamentum, a new hospital, and commercial and residential developments… It will further unlock some 2 000 hectares of the Shongweni Precinct, owned by Tongaat Hulett,” Marokane added.
As a part of the settlement between the stakeholders, Fundamentum and the eThekwini Municipality (Durban City Council) will take joint accountability for protecting the infrastructure growth invoice for the event, with the city carrying nearly all of this price.
According to the builders, Westown holds new personal sector funding potential of greater than R15 billion over the subsequent decade to 15 years.
Fundamentum mentioned it’s at present in talks with different retailers and main manufacturers to take up area on the retail centre anchoring the general growth.
The group claims present estimates are that the event will create over 15 000 jobs over time simply in development, whereas submit completion Westown is anticipated to create at the very least 7 000 everlasting jobs.