China Construction Bank funds new 120-room Park Inn by Radisson Cape Town
The China Construction Bank and the Industrial Development Corporation of South Africa Ltd (IDC) have joined forces to finance the development of a new 120-room Park Inn by Radisson in Cape Town’s Foreshore district.
Brought together by specialist financiers, Construct Capital, the project will see this fast growing area receive some much needed middle-income accommodation though an innovative approach to raising funds by Construct Capital.
“In these tough times, funding, specifically for hotels, is not easy to come by so we rely on a creative, entrepreneurial approach to each project; one that often involves multiple and diverse partners. This method is working well for us," says Ryan Wintle of Construct Capital.
The IDC is committed to promoting tourism, both leisure and business, in the Cape, as well as creating jobs. The Cape Town hotel industry has experienced a huge increase in capacity in the last three years; the strongest growth has being in the 5-star segment while the number of rooms in the 3-star market has increased only marginally.
The IDC is conscious of the difficult trading conditions in Cape Town and takes comfort in that the 3-star Park Inn on the Foreshore is capitalising on the opportunity to develop additional rooms to address this growing demand, which is driven by cost-conscious business travellers and the domestic travel market. IDC takes a long term view in investments in the hotel industry and expects trading conditions to improve.
The hotel is expected to create 71 permanent jobs; this is in line with IDC’s strategy of facilitating job creation and the transfer of skills, to be undertaken by Rezidor, the hotel operator.
The Rezidor Hotel Group, one of the fastest growing global hotel companies, has tapped into the demand for middle-market hotel rooms in Cape Town, redeveloping an office building in Heerengracht Street in the CBD, near the Cape Town International Convention Centre and within walking distance of the V&A Waterfront.
The hotel features a “RBG Restaurant & Bar”, gym, business centre, rooftop conference room for 120 people, a rooftop terrace, a bar and a swimming pool, all with spectacular mountain and harbour views.
After the successful 2010 launch of their first Park Inn by Radisson in Sandton, Johannesburg the group is up-beat. Says Andrew McLachlan, Rezidor’s SA-based vice-president for business development for Africa and the Indian Ocean islands: “While Cape Town has a proliferation of luxury accommodation, we identified a demand for middle market, comfortable, well-positioned hotels; the Park Inn by Radisson fits perfectly into this.”
The founders of Construct Capital, Clifford Kupritz and Ryan Wintle, which focuses on development finance and traditional commercial property finance, have managed development loans in excess of R3bn, bringing extensive banking and development experience. According to Kupritz, this new hotel is ideally positioned in terms of its locality and market and while funding for new hotels has been incredibly difficult to come by, they were still able to raise funds for the right projects
Betts Townsend is acting as the project, development and construction management team. They boast many major projects to their name; some of the most recent include the Southern Sun Hotel Hyde Park, Fairmont Zimbali, Oprah school for girls and the retail pod extension at Canal Walk.
The hotel’s position is ideal, lying close to Cape Town’s financial district and the highly successful CTICC, which recently announced plans for a massive expansion, in light of growing demand for this world class facility. The expansion forms part of a R4.5bn urban regeneration project, which includes retail space, a hospital and an office tower in the area.
