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Hotel boom for Cape Town CBD
I n the face of economic uncertainty, a weak rand and the threat of a possible ratings downgrade, Cape Town’ s hotel industry is bucking the trend by showing booming growth.
Several hotels worth billions will reach completion by the end of the year or early next year.
The Carlson Rezidor Hotel Group has ambitious growth plans for Africa, particularly South Africa, aiming to build 20 hotels by 2020.
The group operates 1 370 hotels in more than 110 countries and has targeted Africa as its key global investment region.
The group announced that three new hotels would open in South Africa soon, two in Cape Town and the other in Polokwane, which will create 1 500 new jobs in the next 12 months. An additional 3000 jobs will be created across the continent in the next 36 months.
Speaking at the group’ s Radisson Blu hotel in Granger Bay yesterday, Marc Descrozaille, area vice president for Africa and the Indian Ocean, said the expansion into Africa started at that hotel 16 years ago.
Other hotel developments include Tsogo Sun’ s R680m SunSquare and StayEasy hotels currently being built in the CBD, and Century Square.
Municipal electricity costs raise cost of living
Municipal electricity tariffs have increased by a massive 86.5 percent since the beginning of 2008 and contributed to the deterioration in the affordability of home running costs, according to First National Bank( FNB).
John Loos, a household and property strategist at FNB, said the electricity affordability component was“ the most troublesome part” of the municipal rates and tariffs bill.
Loos said more upward pressure in this component was expected because Eskom continued to annually press for more above inflation hikes as electricity demand declined.
The municipal rates and tariffs / per capita disposable income index had deteriorated by 31.8 percent from the start of 2008 until the first quarter of this year, with major upward pressure exerted by high electricity tariff inflation.
Loos said the water and nonelectricity tariff / per capita disposable income index had deteriorated by a more moderate 13.2 percent from 2008 until this year, the home maintenance and repairs / per capita disposable income index had actually declined or improved by 9.1 percent over this period.
Brexit sends rand diving worse than Nene firing
T he rand plunged more than the day President Jacob Zuma fired former finance minister Nhlanhla Nene on Friday as the UK voted to leave the European Union( EU).’
The rand dropped over 7.8 % from midnight to Friday morning at 6:30 from R14.33 to R15.45, according to Adam Phillips of Umkhulu Consulting.
The rand plunged just over 5 % when Nene was fired, with millions of rand wiped off the markets.
By 08:30, the rand was 6.77 % down at R15.57 to the dollar. The rand was up 1.52 % against the pound at R21.23.
“ Remember that the UK now has two years to finalise everything with the EU, so I am sure there are going to be plenty of meetings and new decisions from it,” he said.“ As it stands this is a disaster for all emerging market currencies.”
RMB analyst John Cairns said on Thursday that a leave vote“ would generate bedlam. Our guess would be for GBP / USD to drop 12 % to 1.30, while USD / ZAR spikes 4 % or more, well into the 15.00 + area. Volatility would be extreme.”
The pound collapsed to a 31- year low and currency, equity and oil markets went into freefall on Friday as projections showed Britain has voted to leave the European Union.
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6 JULY 2016 SA Real Estate Investor www. reimag. co. za