Western Province a step closer to Newlands stadium development deal
The rugby union believes the loan agreement will enable it to pay off its R112m debt to Remgro and Investec
The Western Province Rugby Football Union (WPRFU) has moved a step closer to concluding a deal for the redevelopment of Newlands Rugby Stadium and moving to Cape Town Stadium.
The union’s club members voted overwhelmingly in favour of an agreement with Flyt Property Group that they say “will enable the WPRFU to accelerate advanced negotiations with the City of Cape Town” to stage rugby matches at the underutilised Cape Town Stadium.
It is envisaged this will bring in an additional R23m a year into the city’s coffers for the benefit of all Cape Town residents.
The union believes the loan agreement will enable it to pay off its R112m debt to Remgro and Investec. It says bank guarantees have been obtained‚ subject to ratification of the agreement by a special general meeting of the WPRFU on July 8.
The WPRFU’s proposed agreement with Flyt Property Group has come under much scrutiny since a previous deal with Investec Property fell flat.
WPRFU said in a statement that the previous development agreement with Investec “lapsed on June 1 2020 due to suspensive conditions not being met. Unlike the previous agreement‚ this new agreement with Flyt Property Group will give the WPRFU an equal stake in the proposed development. It is therefore a much better deal for the WPRFU and the future of rugby in the province‚ which the body of voters clearly recognise.”
The union explained how its agreement with Flyt Properties would work in practice.
“The council also approved a proposal that will see the WPRFU and Flyt Property Group incorporate a new company called Newlands DevCo. This company will be owned equally by both parties with the objective of developing the Newlands Rugby Stadium property into a mixed-use development.
“Importantly‚ unlike previous loan and redevelopment arrangements‚ the WPRFU will have a 50% share in all economic benefits derived from the future development of the site.”
The WPRFU has similar plans for a property 2km away.
“The council also approved a proposal that another new company be incorporated between the WPRFU and Flyt Property Group called Brookside DevCo. This new company will purchase the Brookside property and its purpose will be to develop the Brookside property as a mixed-use development.
“This deal will give the WPRFU access to an estimated R40m in cash‚ plus 50% of development profits down the line,” the rugby union said.
Western Province president Zelt Marais said they are looking forward to working with Flyt Property Group.
“This agreement will allow the union to unlock the value in its properties so it can invest in the long-term development of clubs and players in the province. This bodes well for the sustainability of Western Province rugby going forward,” he said.
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