29 December 2003
In one of the largest foreign transactions in South Africa’s tourism industry, Kuwati-based IFA Hotels & Resorts and local company Moreland Developments have announced a US$100-million investment over the next decade in the Zimbali resort on the KwaZulu-Natal north coast.
In the joint venture between Moreland, the property subsidiary of the Tongaat-Hulett group, and IFA Hotels & Resorts, a subsidiary of the Kuwait-based International Financial Advisors consortium, IFA will acquire a 50% equity stake in Zimbali from Moreland at an initial cost of $10-million (about R65-million).
This is IFA’s second major investment in Africa within the last three months. In October, IFA Hotels & Resorts signed a 10-year $50-million deal for the largest tourism investment on the famed spice island of Zanzibar.
The total added economic value of the first phase of the joint venture’s intended development plan is estimated to be around $350-million, and is expected to increase to about $570-million in the next five to 10 years.
In addition, IFA Hotels & Resorts has purchased a 100-hectare property in the coastal resort for the development of a new 300-bedroom, five-star resort hotel overlooking the Indian ocean.
It is hoped that the move will pave the way for marketing local residential and tourism properties abroad.
The new project, to be named the Zimbali Hotel and Beach Resort, will feature a beach vacation club, spa, country club, resort retail amenities and luxury villas to be developed around a new 18-hole golf course. The resort will open in 2007, and a top internationally recognised branded hotel operator will be contracted to manage the property.
The existing Zimbali coastal resort is widely considered to be one of the leading property developments in South Africa, and boasts the five-star Zimbali Lodge, rated by Conde Naste magazine as one of the top 31 hotels in the world. More than 340 residential units have been sold since inception in 1996, signalling an investment of more than R1-billion.
Tongaat-Hulett chief executive Peter Staude, who is also a director of Trade and Investment KwaZulu-Natal, said at the project’s launch that Moreland was delighted to join IFA in “unlocking the international stature and potential of Zimbali”.
Staude said the development would boosting the province’s economy and create much-needed jobs.
“One of the constraints to the region’s rate of growth is the bulk infrastructure capacity, and we continue to work with the government to find solutions to these problems in order to achieve the region’s true economic potential,” Staude said.
The president of IFA Hotels & Resorts, James Wilson, told the AME Info website: “This is an expansion of IFA’s business in South Africa, which now creates further synergy with our other top-class facilities in other parts of the world.”
IFA’s investment in South Africa was partly motivated by the arrivals statistics produced by the South African tourism department, which show that more than 6.4 million tourists visited South Africa in 2002, making it one of the world’s fastest growing tourist destinations.
Jassim Al-Bahaar, chairperson and managing director of the IFA consortium, told AME Info that the Zimbali development deal would open South Africa up to a large part of the world through the direct access IFA has to international tourism markets.
“Zimbali will link with Zanzibar as well as our resort at The Palm-Jumeirah, Dubai, our planned resort in Lebanon, and the existing hotel and resort in Portugal, the Sheraton Algarve and Pine Cliffs resort”, Al-Bahaar said. “We can offer tourists in Europe, the Middle East and Africa unique network linking IFA’s respective hotels, resorts, timeshare and vacation club destinations.”
Al-Bahaar said the IFA would be evaluating other investment opportunities in South Africa’s tourism industry, commercial sector as well as banking and investment sectors.