Agroprocessing firm Tongaat Hulett realised an operating profit of about R263-million for the year ended December 2008 from the conversion of agricultural land for property development.

The company said that market conditions for property development in the prime residential, resort and commercial sectors were depressed during the year, while demand for land for affordable housing and industrial property in the Durban area remained positive.

However, the shortage of established industrial logistics, support and service locations continued to delay development north of Durban.

CEO Peter Staude said that during the year, 181 ha of developable land was sold, comprising 21 ha in prime locations, mainly Umhlanga Ridgeside and the Umhlanga Ridge town centre, and that 160 ha in the Cornubia area was sold to developers of affordable housing.

Approval for the 260-ha Zimbali Lakes 
development, which entails a five-star hotel and a golf course, was secured late in 2008.

“[Sales of] land for property development in the short term are expected to come from the growth corridor north of Durban that 
begins inland of Umhlanga/Umdloti, extends around the new international air-port at La Mercy and includes the greater Tongaat region,” said Staude.

Tongaat Hulett owns 6 086 ha of land in this corridor.

“Given the housing backlog and government’s commitment to infrastructure spend, there is both opportunity and socio-economic urgency to establish communities with affordable housing in this area.”

Straude stressed that, in the present econ-omic conditions, a small hectarage was likely to be converted to land for property development in the high-value, prime loca-
tions on the coastline and to the west of 
eThekwini and that the focus was on secur-ing infrastructure and development rights for conversion at the appropriate time.

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