Joburg’s Carlton Centre and Cape Town’s 1 Adderley Street could be redeveloped

The property division of Transnet SOC Limited, Transnet Property, has issued two requests for information (RFI) to the market to gauge investor appetite for its redevelopment plan of two prime properties: Carlton Centre in Johannesburg and 1 Adderley Street Precinct in Cape Town.

Transnet – which issued the RFI on Friday, 29 July – says the plan forms part of its corporate strategy to not only optimise its portfolio, but to also strengthen the state-owned entity’s balance sheet.

“Transnet wishes to assess the availability of potential property developers, investors, funders, and financiers that may be available for the joint redevelopment of these properties,” Transnet says in a statement.

The SOE, which found itself entangled in state capture-related corruption for many years, shows signs of recovery in its full-year results for the year ended March 2022.

Read:
Transnet sees green shoots despite another challenging year
Transnet swings from over R8bn FY loss to R5bn profit

On 28 July Transnet posted a return to profit of R5 billion, coming off a R8.7 billion loss in the previous year.

Another indication of a strengthening balance sheet was its 1.8% growth in revenue – although, at R68.5 billion, this is still R7 billion below pre-pandemic levels.

Redevelopment plan

For the Johannesburg-based Carlton Centre precinct, the redevelopment plan will focus on Transnet’s 68 000m² office towers, 53 000 m² retail development as well as its 663 key Carlton Hotel – which is currently closed – and its smaller 63 room Carlton Court hotel.

The revamp of the Cape Town-based 1 Adderley Street precinct will hopefully see a recovery in occupancy levels. According to Transnet, the landmark building in Cape Town is largely empty and only 43% occupied, with the majority of the occupants being fellow SOEs like the Passenger Rail Agency of South Africa (Prasa) and rail operator Metrorail. The building also hosts Rovos Rail Cape Town.

Transnet says it will close the bid process on 31 August 2022.