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Hotels giant Southern Sun Limited has secured a 50-year lease for prime properties on the Durban beachfront, which houses its 734-room Southern Sun Elangeni & Maharani hotel. The deal with landowners, the Ethekwini Metro, was announced recently and will see around R1 billion being invested in the hotel and other properties in the area run by the JSE-listed group over the next few years.
The eThekwini Municipality confirmed the decision in a briefing at the Sky venue on the hotel’s 31st floor. This move comes as no surprise, considering Southern Sun was the only bidder to submit bids for the sites officially.
The redevelopment entails an estimated capital investment of R1 billion, including the refurbishment of the Elangeni and Maharani hotels as well as the Garden Court South Beach and The Edward hotels which are also owned by Southern Sun.
In addition, a fund of R5 million will be made available to restore and maintain the Sunken Gardens, a historically significant park owned by the municipality on the beachfront in front of the hotels,” it added.
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The lucrative leases for one of the largest hotel properties in South Africa came up this year after the eThekwini Municipality decided to offer the sites to the market in the wake of Southern Sun’s leases expected to end next year. The municipality had an open tender process, which it said it had to undertake as part of its regular supply chain management and land tender rules.
