NELSON Mandela Bay's potential for growth has positioned the area as a prime spot for investors to "spend their billions". Three major investors, who have collectively injected billions of rands into the local economy, gave some insight yesterday into the area's scope for growth and how their investments were paying off.
Representatives from Coega Dairy, the Boardwalk and the Bay West City development were guest speakers at a PricewaterhouseCoopers investment presentation.
Bay West managing director Gavin Blows said major research had been completed before the decision was made to invest R2-billion in developing the mall off Walker Drive in the western suburbs.
This will be the first phase of an estimated R12-billion development.
Blows said research had revealed that Nelson Mandela Bay's gross domestic product (GDP) growth over the past five years of 6.75% was well above the provincial average of 4.4%, making the city "a gem" for investment. The group also looked at Bloemfontein as a potential site, but saw Port Elizabeth had greater potential.
Nelson Mandela Bay also had a larger population and average household income, Blows said.
When the mall is operational next year, it will be home to 250 tenants, 85% of them national retailers. It will also be an entertainment hub with a cinema, an area with arcade games, bowling alley and champagne bar.
Blows said it was forecast the R1.7billion construction phase would create about 3000 direct and more than 7000 indirect jobs.
"Once operational, the 250 shops will also need staff and training.
"Currently there are 120000 unemployed residents in Nelson Mandela Bay. Looking at the jobs expected to be created, the impact of this project on unemployment will be about 5%."
Boardwalk complex general manager Clifford Ngakane said more than R1-billion had been committed for the construction of its luxury hotel, smoking casino and convention centre.
"Investors would not have spent so much money if they did not believe Port Elizabeth had the potential," Ngakane said. He added that the investment had created more than 600 direct jobs and hundreds more for catering and cleaning staff.
The hotel currently has an average occupancy rate of between 74% and 80%. Ngakane said when the decision was made on the number of rooms and the size of the convention centre, it had been based on factors including flights to and from Port Elizabeth airport. "You can't build a hotel with hundreds of rooms, but your airport can accommodate only limited flights."
Coega Dairy chief executive Dr Hendrik Kleynhans said the facility, which has been operational for 14 months, would invest R400-million over four years, and had created 450 direct and 1750 indirect jobs.
Kleynhans said Coega Dairy was established because Eastern Cape dairy farmers needed a lifeline. About 10 years ago there were 7077 dairy farmers, but today only 2700 remain.