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Historical Cape hospital acquired for R300 million


Historical Cape hospital acquired for R300 million

Category Property News

Cape Town - A building, housing the oldest private hospital in Cape Town CBD, Christiaan Barnard Memorial, has been bought by private developers for R300 million.

Rabie Property Group and the JSE-listed Ingenuity Property Investments have yet to finalise the development potential of the building.

However, the companies said they were investigating different use options, “ that is - retail, residential, parking and offices”.

In its unaudited interim results for the six months up to February 28, Ingenuity said it had initially planned to acquire 100% of the City Park property, at the corner of Bree and Longmarket streets at a cost of R300m.

However, the company entered into a transaction to dispose of a 50% interest in a subsidiary to the Rabie Property Group Proprietary Limited to co-develop and market the property, through a joint venture.

The building, housing the oldest private hospital in Cape Town, was originally built in 1969 as a commercial building and a parking garage before it was converted and opened as City Park Hospital in 1983.

The building stands almost empty, save for a few tenants after the hospital moved its operations to new premises on the Foreshore in December last year.

Netcare, confirmed that the remaining tenants, mostly dentists, physiotherapists and GPs, were on month-to-month leases and were advised to negotiate further leases. They have until the end of October to vacate the building and find new premises.

Some of the tenants have yet to find suitable premises within the CBD as “a lot of logisitical issues” had to be taken into consideration and ideal premises close to the new hospital would only be available next year.

Netcare said it had offered assistance to some tenants in finding alternative leased premises within the CBD/Foreshore area.

In July 2007, Netcare initiated a feasibility study to determine whether the hospital with a history of medical firsts, including 200 heart transplants, should be renovated or relocated.

However, according to Netcare, the option of renovating would have presented considerable challenges.

“The study indicated that renovating the 17-storey structure while running the hospital efficiently would have posed many logistical difficulties, as well as considerable inconvenience to patients, doctors, visitors and staff members,” said Netcare commercial manager Warren Jaches.

Jaches said the proceeds from the sale of the old building would only reflect in the Netcare financial results for the year ending next month.

However, the new hospital represented a considerable investment by Netcare in the City’s CBD - which is experiencing a property boom despite the economic slowdown.

About R16.2 billion of investment has, conservatively, been committed in the form of 63 developments under way in the city centre since 2012; some, of which are either in the proposed or planning phases, and expected to be completed in 2019.

The new Christiaan Barnard hospital is one of a number of developments planned for the foreshore over the next five to 10 years, which is set to completely revitalise the area and stimulate the same dynamic character of the rest of the inner city.

Rabie, the co-developer of the old City Park building, counts as one of its major successes the development of Century City.


Author SA Commercial Property
Published 04 Oct 2017 / Views -
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