Bethlehem's rising star

The picturesque town of Bethlehem in the eastern Free State has been earmarked for what's believed to be one of the biggest mixed-use developments ever undertaken in the Free State.

Property developers are increasingly shifting their attention away from well-developed metropolitan areas to small rural towns. Bethlehem in the eastern Free State is one of the up and coming investment destinations. The picturesque town has been earmarked for what's believed to be one of the biggest mixed-use developments ever undertaken in the Free State.

JSE-listed property fund Orion Real Estate earlier this month obtained approval for a R1bn waterfront development on a 47ha site at Gobles Folly, near Peermont Global's new Frontier Inn Casino.

The project - to be developed with joint venture empowerment partner Isaac "Blacky" Seoe - will comprise a regional shopping centre of 40 000sq m, luxury high-density residential units, a retirement village, a three or four star hotel, restaurants and other leisure and entertainment facilities.

Aldo Alberts, CEO of Orion's development division, says approval for the project follows the recent lifting of a development moratorium by Dihlabeng Municipality, which incorporates the towns of Bethlehem, Clarens, Fouriesburg, Paul Roux and Rosendal.

Other developers are also placing their bets on Bethlehem. Cape Town-based property group Pinnacle Point Holdings, in which Lazarus Zim's Afribalm Resources holds a 26% stake, recently launched an upmarket residential development in Bethlehem on former farmland overlooking Loch Athlone.

The project - Wesselheim Secure Lifestyle Estate - will comprise 222 freestanding plots, five medium density townhouse developments and a clubhouse with two tennis courts, squash courts, bowling greens and a fitness centre. Residents will also have access to facilities for water sports and fishing.

Pinnacle is known for its golf course developments, such as Pinnacle Point Beach & Golf Resort (near Mossel Bay), Clarens Golf & Trout Estate (eastern Free State) and Wedgewood Village Retirement Golf & Country Estate (Port Elizabeth). However, Dave McGregor, sales and marketing director for the Pinnacle group, says it's shifting focus to residential lifestyle estates in Free State towns such as Bethlehem, Welkom and Bloemfontein.

He says such locations have been bypassed by developers during the recent housing boom and now offer better growth prospects than cities. McGregor says rural towns generally have a huge shortage of new housing stock. Supply pressure is further fuelled by the ongoing migration of city dwellers to smaller towns and a growing demand for weekend leisure properties.

Latest housing data from the Proeprty24's PropertySPI shows that property investors who have already bought into Bethlehem saw values increase by a massive 58% last year.

Interestingly, Deeds Office data shows that average house prices in Bethlehem have now overtaken those of nearby weekend hot spot Clarens: average house prices in Bethlehem have surged to R600 000 compared to R580 000 for Clarens.

Dullstroom, in Mpumalanga's trout triangle and another popular getaway for well-heeled Gautengers, is still slightly ahead of Bethlehem in terms of average house prices at R628 500.

Data recently released by home loan originator MortgageSA confirms that housing markets in SA's rural towns are booming. MortgageSA CEO Saul Geffen says there's been a particularly strong surge in demand for mortgages in mining regions in recent months. He believes that comes on the back of rising commodity prices and increased mining and exploration activities.

Geffen says spikes in demand have been most noticeable in regions such as the Northern Cape, the Free State goldfields and in towns around the edge of the Bushveld igneous complex. – Joan Muller

Article courtesy of Finweek.

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