South Africa Developer Plans to Spend $1 Billion on Flagship Hub
South African property group Attacq Ltd. has earmarked 20 billion rand ($1.1 billion) to further develop its flagship Waterfall City commercial and logistics hub on the outskirts of Johannesburg.
“I’ve got a partner that’s got deep pockets,” Chief Executive Officer Jackie van Niekerk said in an interview, referring to a recent deal with the Government Employees Pension Fund.
The GEPF is the biggest pension fund on the continent and owns a 30% stake in the Attacq subsidiary that runs the 2,200-hectare (8.5 square-mile) development. The deal helped the firm pay down debt and lower its gearing ratio.
The fund said Attacq would need to follow the stock exchange’s processes for any capital needs. “Should that situation arise, the GEPF — through the Public Investment Corp. — would consider any potential request as one of the shareholders of the REIT,” a spokesperson said, referring to a real estate investment trust.
GEPF has backed similar developments in the past, including the V&A Waterfront in Cape Town. Valued at more than 23 billion rand, that site is among Africa’s most valuable property assets and its backers have pledged to invest as much as 4.5 billion rand over the next three years.
Waterfall City comprises offices buildings for the likes of PwC, Deloitte and Accenture, a private hospital, luxury homes, hotels and leisure facilities. Attacq’s portfolio in the precinct, which also includes shopping and data centers and logistics parks, is valued in excess of 13 billion rand, according to the firm.
“Waterfall, by and large, is our biggest focus,” van Niekerk said. The Johannesburg-listed real estate investment trust has interests in retail outlets, logistics hubs and hotels in at least three South African provinces.
Its plans for the largely privately developed and managed settlement come as concerns about the ability of debt-laden municipalities to provide services and decaying public infrastructure continue to push companies and residents to seek back-up solutions for basic goods such as water and power.
Attacq has already built some infrastructure, including roads, needed to support Waterfall City and surrounding areas and uses solar power in key buildings. It doesn’t immediately plan to issue further debt to finance upcoming construction.
