R2.5bn affordable lifestyle estate to be developed near Carnival City Casino

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26-04-2023
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Moneyweb
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Sun International is ‘realising value’ on land that is lying idle.

A R2.5 billion affordable and secure mixed-use lifestyle estate, which will eventually have about 3 000 homes, is to be developed on vacant land next to Sun International’s Carnival City Casino entertainment complex in Brakpan in the municipality of Ekurhuleni, Gauteng.

The JSE-listed hotel and resort group has provided the 50 hectares (ha) of land for the development and is a minority shareholder in the project with developers LivRES – a partnership between project managers Profica and Tri-Star Construction – and the Carnival City Property Company.

Sun International CEO Anthony Leeming said on Tuesday that the group is realising value on vacant land it owns that is lying idle.

Leeming said in the longer term, Sun International anticipates getting out between R200 million and R300 million from the Carnival City Lifestyle Estate development.

“Sun International purchased the land well over 20 years ago because the location was perfect for a casino, even though the parcel of land was larger than needed. Over the years we have weighed up a number of options for the unused part of the property, including selling it off,” Leeming said.

“But it’s zoned agricultural land and we would have got nothing for it. So the decision was to use the land to provide equity for the development,” he said.

Official launch

Alan Dinnie, development director at LivRES, said on Tuesday it was officially launching the Carnival City Lifestyle East Village, the first development in the estate, which comprises 508 units.

It will eventually have about 3 000 homes as well as lifestyle amenities, including a swimming pool, volleyball court, jog parks and lots of green space.

Dinnie added that the estate comprises seven different components and will also have a school, a lifestyle centre and a retail and village centre.

“The seven different components will not necessarily happen in a phased sequence but as they get taken up,” he said.

“We have also paid a lot of attention to the sustainability of the development so there will be solar energy backup in the development to firstly bring down the cost of electricity but also to provide a four-hour emergency backup for everyone in the estate,” he said.

The estate will also have 24-hour security guards.

Breaking ground

Dinnie said the company hopes to start construction of the estate in September 2024 and is currently in a sales sell-out process.

“As soon as we have the pre-sales we will start. It’s hard to predict how long it will take for the estate to be fully developed because these things snowball, which we are anticipating. Once we have the first estate up, we are hoping the others will follow quite quickly but it will be a five- to 10-year period to sell it out,” he said.

“This is really an entry level into the area and to this type of product. The lower priced units in the development also qualify for government subsidies so it’s giving opportunities for people to participate in this development,” he said.

The most expensive units in the estate are currently priced at R1 215 999.

Leeming said the R1 billion Carnival City Casino and entertainment complex opened in November 2000 and was a catalyst for development in the area, with a shopping mall developed across the road, City Lodge building a Road Lodge, and Sun International adding the four-star Carnival City Hotel in 2007.

The current casino and hotel complex is situated on a 30ha portion of land directly adjoining the new development.

He said Sun International has a few vacant land parcels attached to its properties and has been looking at how it realises value for assets that are lying idle.

Leeming said this led to the development, in partnership with another company, of Boardwalk Mall in Port Elizabeth, which only opened last year.

He said Sun International also has a vacant piece of land at GrandWest in Cape Town but is not in a rush to develop it.