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Johannesburg - Close on R20bn is being pumped into property development in greater Johannesburg by Old Mutual Investment Group Property Investments (OMIGPI).
This involves a new Gauteng head office for Old Mutual in the heart of Sandton and the long-awaited Zonk'Izizwe in Midrand, one of the largest mixed-use developments in Africa. These investments are intended to benefit from the opportunities offered by the Gautrain stations and provide for the expansion needs of selected companies.
Second to government, OMIGPI is the largest property owner in the country, with property assets under management worth more than R32bn.
Andries Breytenbach, joint manager of OMIGPI's Triangle Development Fund, says the group was fortunate enough to obtain a prime 3ha site in Sandton, where land for development is now scarcer than hen's teeth. The site is situated on the corner of West Avenue and Rivonia Drive and will house a new Gauteng head office for Old Mutual.
He says the building envisioned will offer about 90 000 square meter of office space, involving a R3bn investment.
The group is also busy erecting a new R730m office development for KPMG on OMIGPI premises in Parktown.
The property group is furthermore on the point of starting the first 200 000 square meter phase of Zonk'Izizwe, a flagship development for mixed use. This first phase will cost R7bn.
According to OMIGPI property development director Brent Wiltshire, the group acquired the 220ha site alongside the Grand Central Airport in Midrand 20 years ago for R50m. The initial phase involves retail space, offices, hotels and residential units.
OMIGPI is also busy with comprehensive developments in Rosebank worth R2bn, and is planning several developments in the Johannesburg CBD involving investment of R4bn. These include the historic Barbican building, which will be restored to its former glory at a R30m price tag.
Breytenbach says fixed property is always a hedge against inflation, largely because of the intrinsic value of bricks and mortar, as well as the contractual obligations of tenants.
- Sake24