MARC HASENFUSS: A brighter Orange
Meanwhile, RBA, a group that should have tapped an economic segment where demand is robust — goes down the tubes
I must confess that I did not expect to see the upmarket 15-on-Orange hotel, located on the fringe of central Cape Town, back on the JSE. Last week newly listed property group Spear acquired 15-on-Orange from Blend Property for R298m. The asset was originally owned by real estate developer Quantum Property Group (QPG) — currently suspended on the JSE. QPG pumped about R400m into developing the property, but could not find operational traction quickly enough to repay and service the borrowings on the hotel. In the hotel trading lull that followed the 2010 Soccer World Cup hype, 15-on-Orange was quickly renamed 15-on-Lemon. In 2012 the property was put into liquidation by Absa, the primary lender to QPG. The purchase price paid by Spear is worth contextualising. Initially QPG flagged a value of about R900m on 15-on-Orange, but by mid-2011 the value had been written down to R688m or R755m (if apartment stock for sale was included). Liquidation papers showed that Absa — in justifying it...
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