It was in October 2012, when the Billion Group, a leading Black owned property development company broke ground on its new centre, Forest Hill City mall which opened its doors for trading on 29 May.
At the ribbon cutting ceremony, Sisa Ngebulana, founder and chief executive officer of the Billion Group, Frank Berkeley, Nedbank Corporate Property Finance managing executive, Executive Mayor of the City of Tshwane, Councillor Kgosientso Ramokgopa, Dr Anna Mokgokong, Billion Group chair of the board and City of Tshwane manager Jason Ngobeni.
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Billion Group is well-known for premier developments such as Hemingways Mall and Mdantsane City in the Eastern Cape
Located at the Corners of R55 & N14 in Monavoni in Centurion, south west of Pretoria, the mall has created around 2 600 permanent jobs for the local community and 7 500 jobs during the construction phase.
Unemployment figures in Tshwane have improved significantly over the period 1996 to 2012 and today Tshwane has one of the lowest unemployment rates in South Africa.
The number of employed people during the last decade is some 17 percentage points lower than the national average, even though 65 percent of its population is under the age of 35, according to the City of Tshwane.
The R1.5 billion development is the first of its kind for the region with a total area of 75 000 square metres - the completed vision of Forest Hill City is a mixed-use development that combines retail and lifestyle with A Grade office space, two hotels and high end residential apartment blocks – all set in a safe, urban hub environment.
It offers four levels of parking area as well.
Inside the mall
Speaking to Property24.com at the opening of the mall, founder and chief executive officer of the Billion Group, Sisa Ngebulana says the name was inspired by the forests, explaining that when he bought the land 11 years ago, it was a huge forest on a hill hence the name.
Executive Mayor of the City of Tshwane, Councillor Kgosientso Ramokgopa, said The City of Tshwane offers investment incentives to attract and promote investment and to stimulate economic growth and employment creation within particular regions.
To replicate the forest idea, the design features a forest theme that gives a vibrant green colour and intrigue, for example, when you walk into the bathrooms it feels like you are walking into a tranquil forest-like space that forces you to calm down and take in the scene.
Understandably so, if you are doing serious shopping, it’s always a good idea to chill.
According to Craig Smith, portfolio manager and analyst at STANLIB, the circular race track design with parking provided in the central core is a first in South Africa.
The benefit of the design is that it allows quick and easy access to the shopping centre from any point within the parkade, however, a possible negative of the design is that the line of shop fronts recedes in certain sections of the shopping centre thus impairing one's line of sight.
Expect to be blown away at the entertainment emporium which holds the fast-food forecourt, Ster Kinekor movie theatre complex, ice rink, wave pool, bowling alley and games arcade.
Ngebulana points out that the ice rink will be operated by the same operator located at Northgate Shopping Centre and this will be ready for use by the end of June.
Dubbed “My way of Life” – Ngebulana says the mall offers unrivalled entertainment thus giving the shopper a unique experience, not just because of the wide range of retail offerings but in an environment that is friendly and makes for exciting intrigue – the rising hill experience as it were.
Forest Hill City has blue chip national retailers including Woolworths, Pick n Pay, Checkers, Edcon Group, Foschini Group and Mr Price Group.
Although some tenants are yet to open, a not-to-be missed grand opening will take place on 10 July, however, on 7 June, Jacaranda Top 40 will be hosted at the mall with lots of prizes to be won and on 14 June from 2pm there will be a Forest Hill Launch Concert to entertain shoppers.
In fact, if you visit Forest Hill City this winter and spend R250 or more at any retailer, you stand a chance of winning R50 000 to spend at the mall.
Banking on retail
To build a mall of this size, requires lots of cash, but for Nedbank Corporate Property Finance, providing funding of R1.36 billion for Forest Hill City was business as usual.
Sisa Ngebulana, founder and chief executive officer of the Billion Group, Ken Reynolds, regional executive of Nedbank Corporate Property Finance in Gauteng and Frank Berkeley, Nedbank Corporate Property Finance managing executive.
“We made the decision to provide the required funding for the development based on our confidence in both the developer and the medium- to long-term future of the retail property sector in South Africa,” says Ken Reynolds, regional executive of Nedbank Corporate Property Finance in Gauteng.
Furthermore, Reynolds points out that Ngebulana shares Nedbank’s confidence in the long-term potential of the country’s retail property market which has stood up very well to the financial challenges that have had a negative impact on other commercial property sectors in recent months.
The bank structured the finance deal by way of a senior debt facility and mezzanine loan provided by its investment arm.
Forest Hill’s tenant mix and future development plans demonstrate an understanding by the developers of the growing trend among many South Africans where mall visits transcend mere shopping outings and have become family entertainment outings.
By capitalising on this trend through its accessibility, appealing tenant mix and contemporary design, the centre will almost certainly secure its sustainable success and ensure its continued growth and profitability into the future, according to Reynolds.
Savvy asset managers know a good investment when they see it, and Forest Hill has not gone unnoticed by STANLIB.
According to Smith, from a location point of view, the mall is highly visible from the N14 highway and accessible, noting an upgrade of surrounding road infrastructure which will further improve accessibility to the centre.
“The mayor of the City of Tshwane emphasised that the area around Forest Hill is earmarked as a growth corridor for residential and commercial development - this bodes well for Forest Hill as it means that its catchment area will continue to grow for the foreseeable future.”
Smith notes that while the mall itself is not 100 percent complete, it does house an impressive and strong tenant mix, pointing out that there is a growing trend in South Africa for shopping centres to provide more entertainment.
The Billion Group has been one of the first retail developers in South Africa to embrace this trend with their entertainment offering at Forest Hill, he says.
“We still like the retail sector but there is no doubt that a prolonged consumer slump will impact the retail sector and we have a preference for companies that have exposure to large dominant shopping centres such as Hyprop and Resilient as they are far more defensive.”
Investing in the City of Tshwane
If the charming personality of the Executive Mayor of the City of Tshwane, Councillor Kgosientso Ramokgopa, is anything to go by, investing is Tshwane is worth looking into.
To replicate the forest idea, the design features a forest theme that gives a vibrant green colour and intrigue, for example, when you walk into the bathrooms it feels like you are walking into a forest area that forces you to calm down and take in the scene.
During the walkabout at the mall on opening, scores of locals who were doing their shopping at the mall stopped to greet Ramokgopa who seems to be at home with the people he meets and deals with.
Needless to say he is local and for those who haven’t met the man in person, you are likely to bump into him at Forest Hill mall.
Having been at the sod turning ceremony in 2012, he says they welcome the opening of Forest Hill as it has turned the area into an economic hub, creating jobs and acting as a catalyst for further development in the area.
Ramokgopa says the mall caters for a mix of LSMs which creates social cohesion, and hence friendly and safe communities for people to work, play and live.
“The mall is a demonstration of the city at work, that the city is open for business and private sector investments such as this one, will no doubt encourage other investors to look closely into this area going forward,” he says.
Presenting the Budget Speech earlier this week, Ramokgopa said Tshwane, as the fastest growing economy on average between 1996 and 2012, has the second highest average household income in Gauteng and is well above the South African average, albeit representative of a figure that must be interpreted with caution.
The Tshwane economy accounts for an estimated 27 percent of provincial GDP and almost 10 percent of national GDP while the Gauteng economy remained the single largest contributor to the country’s GDP with a contribution of 35.6 percent last year, thereby reiterating its presence and importance as a core economic hub on the continent.
The R1.5 billion development is the first of its kind for the region with a total area of 75 000 square metres - the completed vision of Forest Hill City is a mixed-use development that combines retail and lifestyle with A Grade office space, two hotels and high end residential apartment blocks – all set in a safe, urban hub environment.
The City of Tshwane offers investment incentives to attract and promote investment and to stimulate economic growth and employment creation within particular regions.
Incentives are most commonly used to achieve pre-defined strategic objectives contained in government strategy and policy documents (such as IDPs).
“The City of Tshwane has recognised the need to consider providing incentives to business within the context of catalysing investment in the vast space that is Tshwane, as the third largest metropolitan area and arguably the single largest jurisdictional area, globally.
“The City has amended its Rates Policy to facilitate the provision for incentives. In this regard, we have included 'Special Ratings Areas', which will allow us to offer rates bursaries to businesses that meet a specified criteria and development thresholds.”
He explains that within this framework, the potential investor is granted a period in which the site must be developed without having to pay rates, however, should the site not be developed within the specified period, rates for the period shall become payable. Incentive zones are also being considered whereby we will make provision for the approval of higher land use rights in priority development areas.
“We are also implementing a number of measures, which can be thought of as 'soft-incentives' and these will, for example, include the expedition of land use and other development applications processes amongst others.”
According to Ngebulana, Forest Hill City is the epitome of growth and development in South Africa and the mall is unlike any other that the area has ever seen, what’s more, this is the new standard of modern urban lifestyle shopping – the Billion Group is setting the bar high.
“We have invested a significant amount into the area as we believe its location, accessibility and the needs of the surrounding communities will make it a resounding success,” adds Ngebulana. – Denise Mhlanga
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