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Furnishings & DecorPort Elizabeth is a key regional hub for hospitality property with the potential to greatly benefit from significant future economic growth.
So says Joop Demes, CEO of Pam Golding Hospitality, who adds "we're already seeing an increasing appetite for investment in the region from a hospitality perspective from local, national and international investors".
"We are experiencing an increasing trend among South African and global investors seeking lifestyle purchases in areas of the country, including the Eastern Cape, for a better quality of life away from high-crime areas. Most notably, we are seeing a trend among those of high net-worth based in Gauteng seeking businesses ie. lifestyle hospitality establishments such as guesthouses for their children to manage," says Demes.
Last year Pam Golding Hospitality facilitated one of the largest hospitality transactions ever recorded in the Eastern Cape with the sale of Shamwari, Sanbona and Jock Safari Lodge to Dubai World. "In a further transaction, the 2008 sale of Hotel Le Vendome in Cape Town by Pam Golding Hotels to another client from the Middle East was followed by two further acquisitions by the same client – the Protea Hotel & Conference Centre (formerly the Edward hotel) in Port Elizabeth and the Blaauwbosch Game Reserve near Jansenville, both in the Eastern Cape.
"The strong interest in the region is fuelled by good growth in the hospitality industry with 2008 overall occupancy in the Eastern Cape at 76,7% and revenue per available room (Revpar) up by 10,8% in 2008. This region has had an exceptional start to the new year with January 2009 Revpar up by 20,6% when compared with January 2008," adds Demes.
"Port Elizabeth is poised to benefit significantly from increased investment – including that in the hospitality industry - when the market and economy improves. There is no doubt that the construction of the 2010 soccer stadium has been a positive contributor to Port Elizabeth's economy, due to the inherent major capital expenditure in this project. Although this event will provide a short term injection, sustainability and growth will be attained due to future diversified commercial economic activity in the region. In addition, the huge Coega development continues to attract investors and capital projects, and will sustain and fuel future growth opportunities. This is despite the fact that certain construction timelines have been moved out due to current economic circumstances," says Louis van Niekerk, who heads up Pam Golding Hospitality's Port Elizabeth office.
"Various hospitality projects are already under construction in order to increase the number of beds available in anticipation not only regarding the 2010 Soccer World Cup, but also in order to meet a growing demand as a result of other extensive capital projects that are planned for the commercial and industrial sectors in both the Port Elizabeth and East London metropolitan areas. As there is a shortage of accommodation, reservations for 2010 have been block booked, while initiatives such as 'homestay' options have also been implemented to cater for the influx of World Cup spectators," says van Niekerk.
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