|Cape Town headquartered Inframax Developments’ decision to focus on KwaZulu Natal four years ago has proved to be wise one, according to Inframax director, John Weaver. |
Airing his confidence in the province during a Cape Town interview this week, Weaver said that moving into KZN’s middle and upper middle bracket residential markets, in spite of a difficult start, has been one of the company’s better decisions. “Every project we have launched there has Rrecorded fast sales and met our return expectations.”
Recapping on Inframax’s developments in KZN, Weaver listed seven developments, with a total value of R314 million, now under construction. These, he said, had followed on from some six projects with a total value of only R19 million.
“The full current list,” he said, “includes The Bay at Ilala Ridge near Umhlanga Rocks Drive (a joint venture with TCI), Portofino at Shelley Beach and Indigo Bay at Margate (two sea fronting projects for holiday makers and retired people), Langford Country Estate at Hillcrest and The Lighthouse, The Zone and The Sentinel in Moreland’s much vaunted Umhlanga Newtown Centre, more than once described as the best decentralised office and mixed use precinct in South Africa today.”
Weaver said Inframax had originally identified three areas in KZN with successful prospects. These were the Hillcrest/Upper Highway precinct, Umhlanga Ridge and the South Coast. The North Coast, he said, was attractive, but much of the land there, in Inframax’s view, was already highly priced.
“In KZN,” said Weaver, “it seemed to us three to four years ago they were lagging behind the property boom but were likely to catch up. This analysis has turned out to be correct. At the time it meant that land could still be acquired for a reasonable outlay, enabling us to sell our units at attractive end prices.”
The residential market revival predicted by Inframax at that stage, said Weaver, would, they believed, be fuelled by the growth of business facilities at Umhlanga (for which nearby residential accommodation was essential), a pent-up demand for holiday accommodation on the South Coast from people who had traditionally visited this area but had been temporarily disenchanted by the political/violence problems encountered there and by the low interest rates and investors’ disappointment with the equity markets.
Over the next two years Inframax’s focus on KZN, said Weaver, would result in this area providing over 50 percent of their turnover.
In Cape Town, the company continues to be involved with entry level housing at Sarepta and on two new projects at Muizenberg, one about to be launched, but much of their action in Cape Town has taken place through Inframax Investments buying properties for long-term returns.
This section of the group has now grown its portfolio to a value of more than R60 million. To be included shortly in the portfolio is 650m2 of ground floor retail space included in Inframax Developments’ Umhlanga Newtown residential developments.
In Gauteng Inframax is involved with three developments in the entry level bracket. These have a total value of R165 million.
Weaver said that Inframax will continue to operate in KZN, but will now be looking for smaller niche developments rather than the large projects that could run for several years.