Growthpoint eyes Waterfront

Johannesburg - Large South African property companies are eagerly waiting to see what will happen to the country's property crown jewel, Cape Town's V&A Waterfront.

Estienne de Klerk, executive director at Growthpoint, the country's biggest listed property group, told Sake24 on Friday that the company would definitely be interested in buying the V&A should it get the opportunity.

Three years ago the property giant was one of the parties participating in the tender process when Transnet sold the asset.

But now it will get the opportunity only if the financial woes of Dubai World extend to the assets of its subsidiary, Dubai World Africa, one of the V&A's owners.

South African banks with financial exposure to Dubai World reckon there is no cause for concern at the moment. Although Dubai World is unable to meet its commitments of $59bn in Dubai, and has asked its creditors for extension, its South African assets are still unaffected.

The V&A is owned by Dubai World Africa and British group London & Regional, which each have a 37.5% stake, while the remainder belongs to a BEE consortium.

In 2006 these companies snapped up the property for R7bn from under the noses of South African groups. The deal was accompanied by grandiose development plans, which have so far not materialised.

If Dubai World's debt problems should extend to its African assets and it has to sell its interest, London & Regional will have the right of first refusal, but it would find it difficult to finance such an acquisition in light of the global credit crunch.

Earlier this year Dubai World was also in the news when it had to refinance its loan facilities at South African banks, doing so only at the eleventh hour.

On Friday the V&A Waterfront issued a statement to say that, although it knew that Dubai World had declared a debt standstill, this would have no effect on the property's day-by-day operations.

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