Green Point site lease auction generates valuable revenue for service delivery
23 August 2023
Today Council approved the offer by Virgin Active South Africa to lease a portion of Erf 1056-Re, situated in Bill Peters Drive, Green Point, for R3,7 million a month. This is the sports footprint within the Green Point Common known as the Point Gym. This lease, which was auctioned in June, brings to fruition the Economic Growth Directorate’s goal to inject innovation into its property transactions. The revenue generated from the lease of this property has out-performed expectations and will be used for service delivery throughout the city.
The auctioning of lease opportunities is a relatively new concept so, for the first time, the City of Cape Town used this option within the mandated competitive process aimed at opening the bidding opportunity up to a wider audience.
The response to the auction, with some six different gymnasium/fitness centre-focussed businesses bidding, provided a competitive platform. All bidders were mindful of the prime location continuing to provide a complementary sports option to the already award-winning Green Point Urban Park and DHL Stadium Precinct.
‘This compliant, innovated process has resulted in a transparent offer to lease the facility to the highest bid being R3,7 million a month for a period of 30 years, at a market-related rental. The terms of the lease agreement are currently under negotiation and once concluded, the security of tenure will allow the successful bidder to re-invest in the facility, currently comprising a gymnasium, tennis courts, a volleyball court, an outdoor training area, indoor and outdoor swimming pools.
‘The lease of this facility is proof of the City's commitment to driving accelerated inclusive economic growth and prioritising redevelopment of immovable property assets via a competitive auction process that allows all interested parties to bid equitably for such opportunities.
‘And in this case, the demand and subsequent offer far out-performed the City’s expectations. The City's smart real estate approach to releasing City-owned property to get the best economic and social value out of its assets that are not required for municipal purposes is working. The revenue generated from the lease of this property will be used for service delivery throughout the city.
‘I commend everyone involved in bringing this opportunity about and I wish the bidder every success and Capetonians much pride and joy when using the renewed flagship footprint in the years to come,’ said Mayoral Committee Member for Economic Growth, Alderman James Vos.
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Published by:
Media Office, City of Cape Town
