Giles Pendleton, the head of developments for listed Attacq, the developers of Waterfall, said the critical mass of the commercial activities in Waterfall City meant other asset classes could now thrive.
“We have by default created our own pipeline for hospitality, with more hotels driven by the needs of corporates, and for residential,” he said.
Pendleton added they had done a lot of detailed data mapping with a number of corporates located in Waterfall, including how many beds they paid for, which revealed the corporate demand for hospitality was not being met by the only hotel in Waterfall, the three-star City Lodge.
Andrew Widegger, the chief executive of City Lodge, confirmed they were considering a 50-key expansion to its existing hotel in Waterfall City.
Widegger said City Lodge signed up to open a hotel in Waterfall City before the Mall of Africa was completed because they liked what they saw with the overall master plan.
He said it was now coming together nicely, with PwC’s new head office adding almost 4 000 people a day to the precinct and Deloitte's building set to add a similar number.
Widegger said the City Lodge, after quite a slow start, was now trading at a level where they were considering an expansion.
He said they were planning the logistics and in discussions with Attacq while putting together a feasibility study for the expansion to present to City Lodge's board next month.
Widegger said if their board approved the expansion, they would probably start the seven-month project in mid-January or the beginning of February.
He said they had not finalised the cost of the expansion but it would probably be in the region of R35million to R40m.
“It's a land and building lease so we would probably be responsible for about R6m to R8m from a fit-out point of view and the landlord responsible for the balance,” he said.
Widegger said if the expansion proceeded, it would be relatively non-disruptive because the 50 additional rooms would be added on the side and they would knock through to them once they were completed.
Pendleton said apart from the expansion being planned by City Lodge, there were two further hotels in Attacq's pipeline at Waterfall.
“We know there is a requirement for a four-star hotel product and hence we are working on two in the city,” he said.
Pendleton said one hotel operator had already been lined up for a 168-key four-star business hotel but they were not naming the operator now.
“The other hotel is 195-keys and with a similar audience. That operator is a little bit further back in the process but has been identified,” he said.
Pendleton said Attacq would like to commence construction of the first hotel in the first quarter of next year, with construction of the second hotel probably following late in the second quarter or early in the third quarter.
Attacq announced earlier this month that it had partnered with property development company Tricolt to launch Ellipse Waterfall, the first high-rise luxury residential apartments in Waterfall City.
Valued at R1.2billion, Ellipse Waterfall would comprise four towers with a total of 590 flats. The first two towers, comprising the first phase of the development, will be officially launched next week.