Durban - Malaysia’s biggest property company, which owns half of the Durban Point Development Company (DPDC), plans to “revive” the stalled multibillion-rand waterfront project.
According to city manager S’bu Sithole, representatives of the Malaysian company arrived in Durban this week and talks were under way.
City officials tabled a report to the city executive committee (exco) this week calling on it to approve the secession of the Durban Infrastructure Development Trust – valued at R78 million – to the municipality.
On Tuesday, exco gave eThekwini Municipality the go-ahead to cede the trust.
This will pave the way for the city to negotiate directly with investors wanting to pump billions into the Point Waterfront development.
The trust was set up by the city in 1993 to promote the development, planning and construction of Durban’s International Convention Centre, the Point Development and other large capital projects in an effort to stimulate economic growth.
The trust owns half of the DPDC, with the rest owned by Malaysian company Rocpoint, whose parent company, UEM Sunrise, is Malaysia’s largest property developer.
According to the report presented to the exco, the trust owes the municipality R157m it borrowed for the development of the Point.
“It is in the interest of the municipality to effect the secession of the sole asset which is valued at about R78m. This will enable the municipality to effectively take control of the sole asset of the trust,” the report said.
“The Malaysians are now willing to revive the Point development project. This will generate the income required to repay the debt owed to the municipality.”
The development is back on track after an out-of-court settlement with the Save Vetch’s Association and other water sports clubs that stalled the project for four years.
UEM Sunrise chairman, Tan Sri Ahmad Tajuddin Ali, recently told reporters in Malaysia that the company planned a “multi-billion ringgit waterfront development in Durban” over the next four years. One Malaysian ringgit is equivalent to R3.37.
Tajuddin Ali told Malaysia’s Business Times the company had no plans to sell the 12.3 hectares it owned on the Point waterfront and planned to develop it.
“The land is a good asset. The value has risen sharply since we bought it. There is hardly any holding cost so we can keep it until the market conditions there improve... It is a beautiful piece of land, facing the port and the Indian Ocean. We have a strategic partner who is very keen to develop the area,” he said.
The Daily News sent the company questions on Wednesday but had not received a response at the time of publishing.
Sithole said on Thursday that the municipality would be effecting the suggestions of the report, which was authored by the parties’ legal departments.
He said the long-term plan would help unleash the city’s potential and cement its place on the international map.
“In fact the (Malaysian) developers are already in the country. That’s how urgent the plans are. We are just doing our due diligence by engaging with them.”
Neels Brink, the DPDC project director, said he did not know of any firm plans by the Malaysians. Save Vetch’s Association chairman Johnny Vassilaros said he had heard about changes to the plans for the waterfront. “We will wait until they are finally revealed as they were supposed to have been done by now.
“However, the Save Vetch’s Association will support a development that is consistent with the terms of the agreement signed in 2012,” he said.
The agreement saw the DPDC scrap plans for a small-craft harbour at Vetch’s Pier but allows four construction sites to be developed landwards of the erosion line.
Additional reporting by Kamcilla Pillay