Calgro M3 is in a joint venture with Eris Property Group to deliver between 20 000 and 30 000 housing units on the doorstep of Sandton, the Bankenveld District City development, in a multibillion-rand project that could last 15 years, Calgro M3 CEO Wikus Lategan said yesterday.
On March 1, Calgro M3 and Eris formalised the acquisition of a strategic land parcel, which marked the start of the development, where significant commercial, retail and industrial space are also planned.
Calgro, the JSE-listed residential and memorial parks group, said in an announcement yesterday that the project had the potential to generate revenue of up to R18 billion.
Calgro’s share price leapt 7.2% to R5.20 on the JSE yesterday afternoon. It closed at XXX. Eris has some 115 property developments in South Africa.
Lategan said in a telephone interview that the town planning aspects of the project were already in place, and if they get regulatory approvals for the project, including from the Competition Commission, they could break ground on the infrastructure in late October or early November.
He said it was a long-term project and he expected the first unit might only be available to be sold in late 2026.
About 34% of the land for the project was dedicated to infrastructure, including roads, stormwater management, and extensive recreational and green belt areas. The project is on the N3 freeway, adjacent to the Marlboro Road Gautrain station and is connected to the M1 freeway and major arterial routes in Johannesburg.
Both parties would share the cost of the infrastructure installation for the development. Calgro M3 would be responsible for the residential components, while Eris would handle the commercial, retail, industrial, educational and health-care components for their own benefit.
The companies said Bankenveld District City was a project aimed to promote socio-economic upliftment on an unprecedented scale. The 300-hectare mixed-use precinct encompasses 500 000 square metres of warehouse and logistics and commercial development.
Lategan said it was difficult to assess how many jobs would be created, as it was a phased development, over a long period of time.
However, “strategically situated to bridge the gap between affordability and access to Sandton’s economic hub, Bankenveld District City will be a testament to innovative planning and sustainable development,” the companies said in a statement.
The project is more than double Calgro M3’s existing project pipeline.
Calgro M3 had a property pipeline of R15.5bn as at August 31, 2023, consisting of 20 239 units. At the time, the company was active across eight projects and had 2 118 units under construction.
Lategan said they did not intend to rush the project, but would take their time to get the development right, and also to maintain a balance with the rest of the group’s projects.
“This financial injection is expected to support the company’s correct valuation, reflecting the development’s substantial value and impact on the communities Calgro M3 serves,” the company said in a statement.
Eris said on its website that Bankenveld District City would be a “smart, sustainable, inclusive environment that will become the model for mixed-used developments in South Africa”.
BUSINESS REPORT