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Is the tallest building in Africa viable?

Several questions have been raised over the viability of the City of Tshwane’s plans to construct “the tallest building in Africa” in Centurion, situated between Pretoria and Johannesburg.

The suburb, which is said to have a population of around 280 000 is also home to the Centurion mall near the putrid Centurion Lake which has been a headache for residents and the authorities for many years.

A recent announcement by Mayor Kgosientso Ramokgopa that the Centurion Symbio-City project will consist of two offices and one residential tower, including office and retail facilities, has prompted a flurry of criticism and questions.

Gerhard Marais, the chairman of the Centurion Business Chamber says organised business has not been consulted over the project with the chamber first learning of it through the media.
Marais says the chamber’s main concern is the impact the proposed development will have on existing investors who have ploughed money into retail and office space and into the surrounding hospitality industry. Currently, the office vacancy in recently-built office parks in the district is standing at 40 000m².

“We need to cater for our existing members and to make sure that they benefit,” Marais said.
He adds that the occupancy rate of one of the hotels in the vicinity currently stands at a paltry 38%. Building new hotels will only exacerbate the problem.

Marais is at pains to add that business is not opposed to the proposed development which could significantly upgrade Centurion’s business district, but that stakeholders have not been consulted and that insufficient information is available to make an informed decision. Around 106 companies stand to be affected by the move.

The designated architects are @126, described as: “An international professional services company specialising in all facets of design including architecture and interior design,” on its website.

Managing director of the 126 Group, Nick Ristic, told Moneyweb, “We think this can happen. We have been working on it for over a year and have done extensive research.” Ristic declined to elaborate for now, saying more will be divulged in due course.

A number of industry stakeholders, including developers, brokers and architects, speaking on condition of anonymity, say while the project appears to be a “beautiful dream,” it is simply not viable.

They have reiterated the plethora of vacant office space in the vicinity of the proposed development, not to mention the problematic dolomite dilemma.

Moneyweb has not been able to establish categorically whether or not dolomite is a problem. Nor has the City of Tshwane been forthcoming to requests for an interview to clarify issues around the development.

Property brokers and architects estimate that at present a premium building of around ten floors will cost about R18 000 to develop per square metre.

“With the dolomite issues and also just the physics involved, the building cost would be extremely high. For the building to be worth the cost, rentals would be over R250 per square metre … and no company with a sane board of directors would ever pay that much, not even in the heart of Sandton,” they said.

A property broker in Centurion says the foundation for a building higher than 100 storeys would have to be extremely deep, costing an exorbitant amount. In order to obtain yield from this, landlords would have to charge in excess of R200 per m².

The broker says in the case of a mixed use development, this could equate to paying R1.5m for a 70m² apartment which is not viable for Centurion.

Ramokgopa says that the tallest tower will reach 110 storeys and will be flanked by two towers of 80 and 60 floors. The total height of the tallest tower will be 447m.

The Symbio-City development will be built on and around Centurion Lake on ten hectares of land. It will be located between the Ben Schoeman Highway and the N1 Highway corridor, adjacent to the Gautrain Station.

(Moneyweb)



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  • Raal Nordin - posted 06 Jun 2012 12:04 PM                                    

    Investors are entitled to build what they want, and when they want. It is a free country. As long as the correct approvals are obtained, who is entitled to stop any growth. The same applied to Gautrain, was it a great benefit to Centurion, yes. Mixed use development is needed in all major cities of SA. R1,5m for a 70m2 (2 bed 2 bath) is not high if the finishes are attractive. We want world class cities, build it!

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