THE V&A Waterfront is expected to double its impact on the national GDP, pumping more than R220 billion into the economy over the next decade.
This was revealed in a report released by V&A Waterfront Holdings yesterday, in which the company said the top tourist attraction had so far contributed R259bn to the provincial coffers since 2002.
Chief executive David Green said Stratecon, a company that had been appointed to quantify the Waterfront’s contribution to the city, province and country as a whole, had estimated that that number would rise by a further R223bn by 2027.
“We are regularly seeing annual growth of above 10 percent,” he told the Cape Argus yesterday. “Despite a slowdown we have managed to keep this consistency brewing.”
The tourist destination draws about 23.1 million visitors every year, a number that has climbed since 2012’s bumper year in which 21.5 million visitors stopped off at the Waterfront.
“The dramatic increase in the economic contribution of the Waterfront is the result of an increase in the development of additional buildings – the No 1 Silo (Allan Gray) building in particular – and higher turnover generated predominantly by retail tenants paying rents that linked to turnover,” wrote the company in a report.
But there are still developments in the pipeline, such as the grand overhaul of the old grain silo building, which is set to become a museum of contemporary African art. Green said there would be a huge spike in the company’s growth in 2017 when many of the developments were completed.
In 2013, financial experts told the Cape Argus the Waterfront’s growth was startling. But economist Mike Schussler said he wasn’t surprised by the figures.
“This is pretty much what I expected.”
In a financial climate where many businesses in South Africa are struggling to even meet growth targets of 3 percent, the mall represents an outlier.
“(But) they are in a market where tourism plays a role, especially overseas tourism, and that is still a growing industry worldwide.”
About 26 percent of the Waterfront’s visitors in the 2013/14 financial year were overseas tourists. Local visitors made up the bulk of the mall’s clientele at 55 percent while the rest were domestic tourists.
“As I look at it, Cape Town is becoming more and more dependent on tourism… (The Waterfront) is a really great tourism attraction and an important cog in our economy, not only in Cape Town but in South Africa,” said Schussler. “But the growth is more or less what I would expect.”
Green said the mall was becoming increasingly popular with the local market, a market which he has identified as central to the Waterfront’s year-round success.
“Our second most popular demographic is the Cape Flats and we are seeing an uptake in wealthy black consumers,” he said.
Future plans would focus more on increasing the number of local visitors. One part of the script the Waterfront is sticking to is creating more jobs.
In the 2013/2014 financial year, the mall’s management was sustaining 19 269 jobs. This was 20 percent more jobs than in 2012 where 16 177 people were employed at the Waterfront.
Western Cape MEC of Finance, Economic Development and Tourism Alan Winde said: “The Waterfront is not just a major tourism attraction in Cape Town and the Western Cape, it is one of the leading tourist attractions in Africa.
“One of the reasons they are such an exciting economic driver is because they are continually reinvesting and reinventing their offering.”
He said, for example, the museum of contemporary African art – which is currently under construction – was a big investment for not only Cape Town but the continent.
“The V&A are also home to green office accommodation with carbon neutral spaces.
“They invest in free public events and the annual New Year’s Eve celebrations and open air concerts have become very popular. It’s not only the V&A, but the businesses at the venue.
“There is the upgrading at the aquarium and a space like the Watershed which is a great environment for entrepreneurs to showcase,” he said.
Cape Argus