They have been on the lookout for an ideal location for a five-star boutique hotel for some time and settled on the Communicare building on Walter Sisulu Avenue, opposite the CTICC.
The five-storey building houses Communicare’s head office on two floors, while the rest of the building is let for office space and a car park accommodating 78 vehicles.
The 1 294m² site was purchased from the Foschini Group in the late 1980s for R300 000 and construction of the current building was completed in 1991 at a cost of about R10 million at the time.
The development was funded by Communicare and the Cape Joint Pension Fund (CJPF) in a joint venture. Communicare, however, bought out CJPF’s 50% share in 2001.
Communicare chief executive Anthea Houston said: “We considered all options for the best use of the site, including the development of mixed-use social housing. The cost of such a development on this particular land was prohibitive. The land was reclaimed from the sea and has a high water table. The cost of piling, foundations and de-watering would have made the development of low-cost social housing on this site unaffordable.
“The shape of the site also posed limitations for residential development which would have further cost implications. Instead, we decided to sell the property and invest the proceeds in other rental and social housing developments in well-located parts of Cape Town.”
Communicare is working on the development of about 1 100 units this year.
“This includes 138 rental units under construction at Musgrave Villas with development cost of R118.4m, in Diep River, 314 social housing units at Bothasig Gardens with a cost of R176.3m and the mixed use development planned at Salt River Market with a budget of R842m.
“We now have more options to gear our finances and fast-track certain developments,” Houston added.