RDCP battles sluggish progress in Namibia
Pauline Dikuelo | Friday August 23, 2019 13:07
Presenting the financial results for the half-year ended on June 30, 2019, the group’s CEO, Giachetti Guido said the group was still waiting for a title deed for the property purchased there. RDCP spent P4 million to purchase the land.
“We are still waiting for the finalisation of the land acquisitions of our properties in Namibia before starting the developments and on the other hand prospects there are very slow,” he said.
According to Guido, the process took longer than they anticipated.
Once complete the group is planning to build a large shopping complex. RDCP has already approached some retail giants including Spar and Shoprite to lease spaces at the developments once complete.
“We initially were going to have Choppies as our anchor tenant, but they pulled out as the business prospects in Namibia are also very low. The city council also took long to respond to us. We have even asked them to give us more time to develop the shopping complex,” he said.
Meanwhile, the group has finalised the purchase and development agreement for a hotel in Rosebank, Johannesburg on a turnkey basis with a well-known developer, Intraprop.
RDCP says it is hopeful that by February 2021, subject to regulatory and final funding approvals, it will acquire a fully operational 222-bed hotel branded as Radisson Red. The total cost of the development, inclusive of land, furniture, fittings and operating equipment is in excess of R400 million. According to Guido, Nedbank has approved a R200 million loan facility for the development.
“The developer will be paid on transfer of the property anticipated to be after the opening of the hotel. We might then sell some of the 25% of the shares as we are already in discussion with some potential buyers, which might reduce our equity contributions,” he said.
RDCP is also optimistic that Radisson Red will contribute positively to the group’s profits in the first three years.
South Africa has contributed about 28% to the group’s revenue, according to the financial results, following Botswana, which is leading with 72%. The group’s investment and property portfolio grew by four percent to P1.9 billion in the half year to June 30, 2019.