International travellers flocking to South African icon
The V&A Waterfront remains a strong performer for Growthpoint Properties, buoyed by increased international travel.
In a trading update for the quarter ending September 30, 2025, Growthpoint stated that the V&A Waterfront is expected to experience significant growth over the next three to five years.
This comes amid a strong development pipeline for the South African icon, which is owned 50-50 with the Public Investment Corporation (PIC).
In Q1, tourism growth remained steady, with international and domestic passenger arrivals at Cape Town International Airport increasing by 5%.
Hotel demand remained robust, supported by tourism and events. Average daily rates increased by 16% compared to the same period last year.
The Waterfront also saw a strong performance from hotels under an operating agreement.
However, the group noted that the current performance of the iconic property has been affected by the decommissioning and redevelopment of The Table Bay Hotel.
Earnings before interest and tax (EBIT) grew by 5% compared to the same three months in 2024.
Like-for-like EBIT growth was up 16.0%, with the group underpinned by an 8% increase in retail sales, which boosted turnover-based rental income.
The group’s office portfolio continued to perform strongly, with zero vacancies and sustained demand contributing positively.
The marine & industrial sector in the Waterfront also saw improvement, driven by increased demand for casual berths.
Growthpoint said that investment in the precinct continued during the period, which included the following projects:
- The desalination plant was successfully commissioned and has been operational since mid-March 2025, generating 3.3kl of water per day.
- Development on the 3,759 sqm new luxury wing at Victoria Wharf is well advanced, with completion expected in December 2025 and phased occupation thereafter.
- The Table Bay Hotel is on track to reopen as an InterContinental Hotel in a phased manner from December 2025.
- Development of the Quay 7 luxury hotel, comprising 142 keys, is well progressed to be completed by June 2026, and
- Construction of the 5 Dock Road residential apartments is expected in January 2026.
Excluding residential sales, EBIT for FY26 is expected to be marginally higher than the prior year.
This is primarily driven by the strong performance in the retail and hospitality sectors, which benefit from increased international tourism.
Outside of the temporary loss of income from the Table Bay Hotel and the Luxury Mall, the group said that the Waterfront’s operational performance is robust.
Other developments
Growthpoint stated that the group incurred R249.2 million in development and capital expenditure for its South African portfolio during the quarter.
This included projects at La Lucia Mall, Durban (R24.3m), Longbeach Mall, Noordhoek, Cape Town (R17.6m), Beacon Bay Retail Park, East London (R16.1m), and Alberton City, Johannesburg (R10.8m).
La Lucia Mall is set for a major Expansion, with Checkers as the lead tenant. Meanwhile, Shoprite is launching at Alberton City.
Due to the low South African loan-to-value ratio, reduced debt levels and lower cost of capital, Growthpoint is evaluating a host of acquisitions and redevelopments.
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