Property

Royalty calling

Africa has, in the last few years, become a significant target for investors, particularly from Chinese institutional investors with eyes on the continent’s vast natural resources. That attention has resulted in an uptick in traction among individual investors as well. Last year, the Royalston in Port Elizabeth launched its upmarket, conservation-focused residences on the south coast, and hot on its heels comes Thanda Royal Residences. With embattled President Joseph Zuma resigning in February, does South Africa have what it takes to be a global investment hotspot?


Thanda Royal Residences pool

Improving Prospects

Despite external shocks that put national economies on alert in 2016 and 2017 (falling commodity prices, slowed growth in China), Africa as a whole is in an optimistic position, with Nigeria, Angola and South Africa the powerhouses of Sub-Sahara Africa. South Africa has a fair amount going for it on the property front: no restrictions on constitutionally entrenched freehold ownership, an established, transparent legal infrastructure, and a weak Rand making currency favourable for overseas buyers (one Hong Kong dollar gets ZAR1.50). 

That's not to say things are ideal. The country’s growth has been impacted by subdued mining and manufacturing, and severe drought affecting agriculture, and narrowly avoided recession in 2016 according to Knight Frank’s 2017 Africa Report. Add to that the continued perception that the country is dangerous despite, according to the UN-approved Global Peace Index, being safer than Mexico, the Philippines, and Turkey, and only marginally less safe than China, lingering corruption problems, and now a serious water crisis in Cape Town and the picture in South Africa gets fuzzy for investors. Valid fears or just more Africa-phobia. “Great question! Is Paris, London, or New York safe? Is water an issue globally?” asks Waldorf Investments Chief Executive Officer John Brun. “South Africa is a true emerging market, with tremendous ground swell of confidence among its people.” There is also optimism new ANC leader Cyril Ramaphosa will clean up Zuma’s mess and restore South Africa’s place in the commercial world, “making it a great and safe place to invest and enjoy.” 

The Sub-Saharan economy is expected to grow after a modest recovery in 2017, to roughly 4% by 2019, and many of the factors that made South Africa the continent’s most developed economy are still in place. It has a young, urban population, an asset as the world ages, and tourism is also healthy, with 3.5 million arrivals in August 2017, according to the Tourism and Migration Survey released by Stats SA. International arrivals dropped slightly, but Africa-for-Africa, travel was robust. 


Thanda Royal Residences dining room

Housing prices in South Africa slumped in 2016, reflecting the generally subdued market, but locations such as Cape Town, Port Elizabeth and Durban outperformed their inland rivals. Domestic demand underpinned those markets, as South Africans flocked to the coasts for lifestyle reasons. The next year saw moderate gains, putting the country in its current position as a potential investment, which Asian investors have been tapping into for some time. “The Asian market's interest in commercial and industrial Africa also means there are investment opportunities for residential acquisitions,” says Susan Turner, Managing Director of Knight Frank South Africa. “There is strong capital growth in select properties, which offer value for money in international terms. South Africa is also riding on The Belt and Road Initiative action plan.”

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A more stable political future goes hand-in-hand with investment as Turner sees it, and recent events could keep South Africa ahead of regional rivals. “There is a wait-and-see scenario currently, but a general positive mood with a solution-driven nation. The property environment still shows growth and further growth is expected with the resignation of President Zuma,” she notes. 

Just in time, Thanda Royal Residences is a freehold villa development on a nature preserve, and a project that combines conservation, culture and luxury living. Located in northern KwaZulu-Natal, in the heart of the Zulu Kingdom, the freehold Thanda Royal Residences have the blessing of His Majesty King Zwelithini Goodwill kaBhekuzulu. This is an area boasting some of South Africa’s richest and oldest culture, some of its most breathtaking scenery, and of course teems with wildlife, including the country’s big five: lion, buffalo, leopards, rhinoceros and elephants. In general, South Africa has hit Asian investment radar for its currency play, relatively close proximity, and its ideal marriage of the urban and wild worlds. Increasing environmental awareness helps too. “We have a global responsibility to our children to ensure that the rhino will still be here for their children. We need to re-educate China and Vietnam that rhino horn is useless to everyone except the rhino,” adds Brun.


Thanda Royal Residences outdoor fire pit

Thanda Group’s third project in Africa, following the five-star Thanda Safari resort and Thanda Island marine reserve off the coast of Tanzania, is as socially and economically committed to the area and its people as its first developments. The Estate — whose residences are designed with local flair complemented by modern convenience by architects at SVA International and Pattichides & Partners — comprises of 44 individual villas on private plots ranging from one to 38 hectares on a 14,000-hectare private game reserve; the villas themselves range from 3,700 and four bedrooms (a standard unit) to just over 9,100 square feet. All villas feature stunning views of the surrounding valleys, hills and grasslands, and are offered in traditional or eclectic design schemes, with entertaining and spa facilities and swimming pools. The Estate will also feature comprehensive clubhouse facilities, a boutique hotel and concierge service available to owners, and exclusive events include formal nights in the bush with the King. Thanda’s membership in the Leading Hotels of the World affords owners access to other exclusive properties, and owners (Members as Thanda refers to them) are welcome to enter their property into a blackout-free rental pool, with yields of up to 8%. Regardless of when or what you buy, “You will own one of the most exclusive pieces of real estate on the planet,”
finishes Brun.

Prices at Thanda Royal Residences begin at roughly US$6 million (approximately HK$47 million). For more details contact
www.waldorfinvestments.net