Economic plan to boost property
The west coast town of Saldanha Bay is set to come into its own if development zone plans get the green light. Lea Jacobs reports
PROGRESS towards the declaration of Saldanha Bay as an Industrial Development Zone (IDZ) is well under way. The town is located on the Cape’s West Coast, about 120km north of Cape Town, and its port was recently developed into a modern harbour with the construction of a deep-water jetty to accommodate ore ships.
Named after António de Saldanha, a captain of one of the ships in Afonso de Albuquerque’s fleet that visited SA in 1503, the town’s location makes it a favourite spot for water enthusiasts. Verging on the desert of Namaqualand, the region has a Mediterranean climate, albeit with low annual rainfall.
The intention to declare the development zone was gazetted in November last year, with a public comment phase closing this past January. Trade and Industry Minister Rob Davies is now studying the feedback, and will consult with the Cabinet before making a final decision — although this is expected in a matter of months. Signs are positive, with Davies saying in February that a feasibility study had found Saldanha Bay to be an ideal location for the development of both an oil and gas centre and a marine repair hub.
Pam Golding Property area manager for the West Coast, Stephanie Wynne Cole, says the town forms part of the larger Saldanha Bay municipality, which also incorporates nearby Vredenburg and Jacobsbaai. Together they are home to just under 100,000 people. The area's economic character is anchored by its natural deep-water port, which has already attracted significant industrial activity — ArcelorMittal’s steel-manufacturing plant, Sea Harvest, Namakwa Sands (Exxaro) and Durfeco. There are also three military bases in the area, and a number of smaller businesses and enterprises.
“The IDZ process has identified four main sectors for further development,” says Wynne Cole, “namely renewable energy, oil and gas, maritime ship building, and steel and minerals. It is estimated that the project will create at least 4,500 direct jobs in its first year, and up to 15,000 in subsequent years. And in fact, a recent study by the University of Cape Town Graduate School of Business has indicated that these figures might even be conservative.
“That study also found that for every rand spent on the IDZ project, some R9.50 in return will be generated — one of the highest cost-to-benefit ratios the team of economists has ever encountered for such projects.”
What does this mean for property in the area? If the IDZ goes ahead, Wynne Cole says it will bring a huge influx of professionals and their teams who will be working on the new industrial and port developments, and who will all need accommodation in the area. “There is already very big rental demand in Saldanha and Vredenburg,” she says, “especially in the R2,000 to R6,000/month price range. We are already short of stock, and with demand set to increase exponentially, it would seem to be an excellent time for investors to acquire buy-to-let properties. With the creation of so many sustainable new jobs, there will also surely be increased demand for buy-to-live properties from those who will be settling permanently in the area, or who find their economic status improved by the opportunities associated with the IDZ.”
Pricing in the area covers a range of properties, including older homes and new developments, in a variety of price ranges. An entry-level small home can be obtained from R300,000 to R800,000, while mid-level properties are priced between R800,000 and R1.2m. At the top end of the local market, larger and more luxurious homes can fetch from R1.2m to R6m, or even more for mansions located on the beachfront. There are also a number of vacant stands still available for development.
“The new job opportunities created by the IDZ will … boost demand for homes, both rented and owned.
“The project will also expose many new potential buyers to the superb lifestyle on offer in the Saldanha area. Besides the appeal of the beautiful bay and its beachfront, there are ample sports facilities, restaurants, churches and social clubs to enjoy.
“The West Coast Mall in Vredenburg has boosted the presence of major retailers, while medical care is available in Vredenburg, which has both government and private hospitals. For those wanting to settle families in this idyllic environment, there are numerous schooling options, including both private and government schools.”