In the beginning it was the ‘Cinderella’ of industrial parks, but now Capricorn Business Park is rapidly turning into a resounding success story. It’s also home to a proudly South African business that may just hold the key to Cape Town’s water shortage. Ikon Properties explores this exponential growth and chats to NuWater.
The Cinderella Story
The initial key driver for the establishment of Capricorn Business Park, was based on the success experienced in Westlake, offering much-needed industrial space in the Southern Suburbs. The original shareholders Nedbank, Grinaker, Brimstone and PIC, aimed to create a technology and business hub that set new standards in environmentally-friendly working spaces. Spaces that were also complemented by award-winning design guidelines. However, before the Park could gain much traction, the economic downturn in 2008 resulted in several liquidations and a subsequent decline in the demand for smaller businesses. Consequently, lower rental yields, higher vacancies and a downturn in land prices soon became a trend. Despite a shortage of industrialised zones, Capricorn Park was still considered too remote in terms of location. It wasn’t until 2014 when we saw this trend reversing. In 2014 the average land sale price was R660/ m². Currently these figures average R1222/ m². According to CMA (Comparative Market Analysis) the land price has increased by 100% and doubled since 2014, and the extent of total land sold has decreased by 30% since 2015.
An unparalleled home for business
This multi-use business park has transformed into coveted industrial space in the sought-after Southern Suburbs with approximately 100 tenants, with mostly light industrial users and some office.
Ralph Lax of Ikon Property Group recently brokered the sale of the building currently tenanted by NuWater to a private investor. NuWater is a proudly South African company whose primary business is desalination and wastewater treatment. The building was initially the Convention Centre in Capricorn Park and was then further developedto NuWater’s specification. Rehabilitation of the surrounding dunes was also part of the build.
The original building was considered an architectural showpiece and still is. The revamped NuWater head office overlooks the lake and offers majestic vistas of the Muizenberg mountains and False Bay coast.
We spoke to NJ Bouwer, Chief Business Development Officer for NuWater who says: “We chose Capricorn Business Park to relocate our global headquarters for a number of reasons: The eco-centric ethos of the Park aligns perfectly with our business objectives. Our business is focused on minimising the impact on the environment through our projects that incorporate desalinating seawater, reclaiming and remediating wastewater or simply improving basic water quality. This means we often have clients, who through their operations such as mining, contaminate water, which we in turn remedy.”
Location, Location, Location
Cape Town now tops the ‘most congested traffic levels’ in South Africa with an overall congestion level of 35%. Capricorn Business Park has evolved as an attractive option with regards to mitigating the challenges of traffic gridlock. The Park has become a decentralised business hub and companies that choose to relocate could also reap the benefits of improved staff productivity levels.
Bouwer adds, “As a company location, Capricorn Park offers easy commuting access from main highways and dedicated taxis to and from Muizenberg and Steenberg stations. Centralised access for staff was a major factor influencing our decision to setup in Capricorn Park.
When we arrived, it was only 60% occupied and now it has a 95% occupancy rate with only few development sites still available.”
Ralph Lax is a specialist in sales and rentals in Capricorn Park. “Over and above the sound investment returns, there are so many other benefits for developing or renting in Capricorn Park. The Park perimeter is fenced, has access control and 24-hour manned security. It is administered by Rabie Property Administrators, a credible management company, specialising in property management. The Park’s trustees oversee the on-site management including maintenance of common areas and ensuring environmental compliance that mitigates any negative environmental impact.”
Further to this Lax concludes: “The current asking rental rates for existing buildings are between R58 – 65/m². For new-build premises it ranges from R70 – 75/m². There are currently approximately 20 vacancies in the park for small light industrial units ranging between 150 – 500m.”
Cape Town solution to Cape Town water crisis
Admittedly desalination has had a bad rap in the past, mainly due to the high energy costs associated with the process. However, the advancements in the process over the last 5 years has seen energy usage reduced by 30%.
Bouwer maintains: “Desalination is a simple technology of removing the excess salts from sea-water up to the standard of potable water. The process can be driven off mains, generators or even solar power. It gives a stable performance especially if you are operating on strained energy grid. It also doesn’t rely on massive amounts of chemicals. So, the offsets are there.”
NuWater is working towards being a part of the City of Cape Town’s water crisis solution. They are in the process of tendering for three Desalination systems at Granger Bay, Hout Bay and Dido Valley where they will extract water directly from the sea and treat it to a potable standard. According to Bouwer, this technology augmented with effluent reclamation, ground and surface water treatments will give the City the most economical and effective water sourcing plan.
“As a Cape Town based company, the economic drivers are very evident. If we were to secure this tender we can impart these specialised skills, train more operators and create local jobs.” Because we are so water-strapped and ‘drought is the new normal’, the solutions to our own water shortage are here, in South Africa.