The coastal tourism, resort and lifestyle residential sectors in KwaZulu-Natal remain constrained by a lack of available land – an issue that Tongaat Hulett Developments is attempting to address through the release of key sites within its portfolio of prime land north of Durban and Ballito.

According to Mike Deighton, Tongaat Hulett’s executive responsible for property development, the company’s first response has been the release of Sibaya Nodes 1 and 5. Together with, Savills in the UK (in association with 5th Avenue and the Pam Golding Properties Group), the company will begin aggressively marketing this strategic node to international investors during the first quarter of 2015.

A total of five nodes make up the first phases of the mixed-use Sibaya development. Node One consists of 50 developable hectares and is located east of the M4 and Sibaya Casino. Node Five comprises 76 developable hectares and is situated immediately north of Node One. It is bordered by the M4, the M37 to the north and the coastal town of Umdloti to the east.

Nodes 1 and 5 have 180° sea views, a backdrop of extensive natural coastal forests and they are within easy reach of the King Shaka International Airport.

The development possibilities for these two Sibaya nodes include major new resorts in conjunction with lifestyle residential accommodation, upmarket offices and developments suited to the leisure and hospitality industry, hotels, conference and entertainment facilities as well as retail and recreation facilities.

“Tongaat Hulett envisages that the Sibaya precinct could have a unique play-live-work lifestyle that is based on bringing together the best of both urban and natural environments. These opportunities lend themselves to organisations possessing global expertise and bold vision to maximise their enormous potential,” says Deighton.

The appointment of international real estate services provider, Savills, to market the two properties emphasises the strong focus on enticing international buyers. However, 031 Business has it on good authority that interest is also growing amongst local developers of high end estates that are being actively marketed both locally and offshore.

“The Sibaya site provides an opportunity to deliver a new destination for Durban to attract international investors, hotel operators and businesses. Durban has seen tremendous expansion in recent years, with the construction of the new international airport and Dube Trade Port being real statements of intent from government to attract international investment to the region,” says Daniel von Barloewen, head of Savills International Development Consultancy.

However, the central strategic thrust of Tongaat Hulett’s land conversion process is to create substantial value for all stakeholders rather than just high end investors and developers. 

“The Sibaya precinct presents a powerful proposition for a catalytic impact on the region. Situated within an emerging aerotropolis, there is an appreciation of the vast socio-economic needs within this broader region and Tongaat Hulett believes that new international investment into Sibaya will provide a substantial boost to the development necessary to address these challenges, enhancing the region’s global presence and branding,” explains Deighton.

Although Tongaat Hulett is an agriculture and agri-processing business focusing on the complementary feedstocks of sugarcane and maize, its unique skill and competence in the conversion of agricultural land to development has created significant value through the unlocking of land from the group’s substantial property portfolio.

Given conservative economic recovery after the world economic recession that rocked both the global and local property sectors from 2008 onwards, it is likely that Tongaat Hulett will step up the pace of its land conversion during 2015.

Already, together with its partners, the company has planned and developed approximately 2 000 hectares of land since 1990 at a cost of approximately R1,5 billion.

Developers who have brought bulk land from Tongaat Hulett have constructed more than 100 office and factories, 5 000 residential units, Umhlanga Gateway and Crescent shopping centres, the Sibaya Casino and Entertainment World, four hotels, the Umhlanga and Gateway Hospitals and Crawford and Umhlanga Colleges amongst others.

Downstream investment has totaled well over R13 billion. This has created more than 50 000 new jobs in both the construction and end-use industries and provided a meaningful boost to economic activity in the greater Durban and KwaZulu-Natal North Coast Corridor.

As substantial further investment is expected not only within the Sibaya surrounds but also at Cornubia and the Dube Tradeport, both the spend and the number of jobs created is expected to continue to climb.

Going forward, it is certain that Tongaat Hulett will be a key role player in reshaping Durban’s northern urban landscape for at least the next decade. Umhlanga is increasingly the prime location for property development in the city. Tongaat Hulett is still the largest landowner with some 1 100 hectares of land available for conversion to development over the next few years.

In addition to Umhlanga and Sibaya, Tongaat Hulett owns 2 500 hectares of prime coastal property north of Ballito. As the tourism sector in KwaZulu-Natal develops over time, these landholdings are also ideally placed to attract major resort development – again potentially by global players.

The first landholding that will be targeted north of Ballito comprises 270 developable hectares to the south of the Mhalali River near Tinley Manor. This is driven both by the northward growth of the Ballito area and by the resort potential of this stretch of the KwaZulu-Natal coastline.

Aware that land conversion from an agricultural base to higher-intensity urban uses requires policy and planning leadership from the appropriate spheres of government, Tongaat Hulett has developed collaborative relationships with all spheres of government in order to maintain the momentum of infrastructural investment.

The nature and style of the land conversion process varies, depending on the potential usage and positioning of the land concerned. Currently, some of the key themes on which Tongaat Hulett is focusing include urban growth and consolidation in the Umhlanga region, coastal, lifestyle, leisure and high-end residential development along the Northern Corridor, development of the airport region, urban expansion west of Durban, resort development in the coastal area north of Ballito and integrated housing and development in the greater Durban areas for people from the lower socio-economic strata.