We are continuing our focus on major residential estates in South Africa this week.
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In this episode of The Property Pod, I speak to an Olympic gold medal-winning swimmer.
No, we’ve not changed this series to a sports podcast. You may have guessed it: we have none other than Ryk Neethling featured as a guest in our latest podcast.
Who could forget South Africa beating the US to gold in the 4x100m freestyle relay men’s final at the 2004 Olympics.
Well, over the past several years Neethling has been a shareholder and marketing director of Val de Vie Estate in the Cape Winelands. The sprawling estate that includes Pearl Valley is rated as one of South Africa’s top residential estates.
Neethling shares insights on his involvement in the landmark property project and latest developments at the estate.
Highlights of his interview appear below. You can also listen to the full podcast above or download it from iono, Spotify or Apple Podcasts.
“I have been involved [with Val de Vie] for just over a decade. The time for the past I think six years really flew by when we bought Pearl Valley and land that was supposed to be Pearl Valley Phase Two. We bought that in 2014 and since then things just really took off.”
“The first few years were very slow just after the global credit crunch when, I think in the year that I joined, we sold one developer stand the whole year. So it was quite a tough time, but it was also a good time to start.”
“After I received my degree at the University of Arizona in America I worked in commercial real estate development for three years.”
“So, when I met Martin [Venter], who was one of the first five employees at Atterbury [Property Cape] in the early 2000s, we really connected … We had this kind of shared passion and background in commercial real-estate development, and I just fell in love with Val de Vie. It was very early days then. There were, I think, 28 homes.”
“Today we’ve just under 2 000 homes. I really bought into his vision and, like I said, the first few years were quite slow-going.”
“People actually warned me and said they didn’t think Val de Vie was going to make it. It was in the time of estates like Gardener Ross, which is now Copper Leaf; there were quite a few estates that went bust in those days.”
“I think there are a few things that pulled Val de Vie through. We started winning awards here in about 2014. The market picked up and we literally haven’t looked back since.”
“Security is by far our biggest focus, and all buyers are looking for that … We bought the land from Standard Bank, which was going to be Pearl Valley Phase Two, and we started to develop that in about 2015. We bought Pearl Valley in 2015 and we’ve been very fortunate.”
“I think the past year has just been incredible as well. Obviously there was a lot of uncertainty during lockdown when we didn’t know which way it was going to go, but I think our repositioning as a wellness estate has proved extremely fortuitous for us.
“The looting that happened in the rest of the country and the crumbling municipal infrastructure have really pushed people to this part of the country – and we’ve been fortunate enough to really benefit from that.”
“I also just want to say that I think a lot of people are looking to leave the country, but at least 20% of our enquiries and our buyers are coming from people either returning after 10 or more years overseas, or from international people who have never lived in South Africa and who are moving here.”
“That’s always a light point and a positive sign that, despite all the doom and gloom in the local market, people still want to move here.”
“In the last 12 months I think we’re standing at about R2.5 billion worth in sales [in the estate]. That includes resales.
“It just shows you how strong the market is. As I’m speaking to you, there’s not a single house available for rental on this estate with just under 2 000 properties.”
“Obviously that causes a lot of price increases and capital growth. In a sense you are growing out of your market a little, but since last year this time we’ve seen about a 35% capital growth in some of the properties and homes.
“On land it’s even more than that. So, yeah, it’s been good. We talk about a perfect storm, all these factors playing into it now with interest rates up a bit. We’ll see how that affects [things], but it’s been a good 18 to 24 months.”
What are the latest developments at the estate?
“We’ve just launched our luxury suites of our Evergreen Retirement Village, where we’re going to [offer] about 200 suites – so luxury apartment living.
“We’ve got 137 completed homes that have all been sold. Actually, we’ve got just one house still available in the Evergreen Retirement Village. We are building 60 homes that will be completed in March [as part of the next phase], and then the apartments.”
“I think the beauty about the Val de Vie green village is that it’s in the heart of the estate. So it’s not in a corner somewhere where retired people live. It’s literally in the heart; we are, incredibly, seeing the whole concept of multi-generational living – where the grandkids are very close to the grandparents and I think the retired people really are part of the community.
“It is on a life-rights basis, but the people who have bought into this concept are our biggest ambassadors.
“We’ve got a few more homes to build. We’ve got 60 homes that will be completed in March, but I think the Paarl/Franschhoek Valley is very quickly becoming a hub for retirement.”
What’s the ballpark figure of development that’s taken place at Val de Vie since its initial establishment and what makes the estate special?
“We estimate about R1.5 billion worth of infrastructure that has gone into, let’s say, bulk infrastructure – and the facilities as well.”
“[Then] we’re looking at about R2 billion [for] all the homes. We’ve got about 1 800 units. The average house price is around R10 million. So we’re looking at about R3 billion in total.”
“I think it’s a combination of the incredible vision that was displayed in the early days … This used to be an old mine quarry that was turned into this beautiful estate, really bringing life back into this land that was mined.”
“Obviously [there are] all the facilities. I think what makes us different is that it’s all authentic. We have one of the biggest polo clubs in Africa; the golf club is obviously very well supported. So [it’s] everything that we do.
“The [estate’s] wine cellar is one of the biggest exporters of wine to the Far East. So everything that we do is really authentic.”
Tell us more about the semigration trend into the Cape Winelands and who are buying into Val de Vie?
“We’ve seen incredible interest from KZN. I think it’s taking those families a little bit longer to make the move, because their roots are so deep in KZN. We had one instance where there were 10 families that all came together to move all 10 families here. That shows you the extent of it.”
“In October and November our hotel was full of people from KZN coming for the weekend, and staying here and then picking up stands. So that’s definitely been a big portion of the market.”
“But I think the largest market at the moment for us is people moving out of Cape Town, out of the city. That is just the global trend if you look at all the big cities.”
“In a post-Covid world people are moving just because they don’t have to go into the office every day. The work-from-home trend has really benefitted us as well. People can work here. Maybe they go into the city once or twice a week, off-peak times, where it takes you only 35 minutes to get into town and you don’t have to go at seven o’clock in the morning.”
“People moving from the southern suburbs, the Atlantic Seaboard and the city bowl out here have been our biggest market. And then obviously from Gauteng as well.”
“I think the Winelands is really going to benefit from this. You see some interesting developments like the Fisantekraal Airfield [Cape Winelands Airport development]; they’re looking to turn that into a Lanseria of the Cape. So very exciting. There’s a smart city plan here in Klapmuts, which is just a very short drive from us.”
“So there are some very exciting [happenings] for the whole area, for the Cape Winelands. To really benefit from that we’ve got the Green School, which is in an international concept school that opened right outside our gate. It’s an exciting time for the Cape Winelands.”
“I think one-dimensional estates like the old typical golf estate where it’s just golf – I think the days of those estates are over. People want more offerings, more choices, and we can see that ourselves and in the sales of other wellness estates across the world.”