Umhlanga Arch – a trendy new R1.3 billion development near the Gateway super-regional mall in KwaZulu-Natal – is gearing up for the opening of South Africa’s first Hilton Garden Inn hotel within the mixed-used property by November.
The 207-room hotel, covering 10 000m2 and pegged as a four-star establishment, is a key part of the overall 45 000m2 development. Umhlanga Arch also includes a 32-floor residential tower with 200 apartments, 6 500m2 of office space, a retail section with several restaurants and upmarket stores, a flagship SMG BMW dealership, and a conference centre.
Durban property developer Charles Thompson is behind the project. His group Devmco is a 30% shareholder, while the major backer is local private equity firm Multiply Group.
“Construction began on our iconic Umhlanga Arch development in 2018 and we are thrilled that the overall project is virtually complete, with the Hilton Garden Inn anticipated to officially open by November,” Thompson tells Moneyweb.
“The hotel will be handed over in October to Hilton, which is the global hotel group we’ve secured to manage the property.”
The Covid-19 pandemic and resultant lockdowns has dealt a severe blow to the tourism and hospitality industry, with many hotels across South Africa still closed.
‘Timing couldn’t be better’
However, following recent significant declines in new infections and the opening up of inter-provincial travel, Thompson believes the timing could not be better to open “Umhlanga’s first internationally branded four-star hotel”.
“Covid-19 had delayed the opening of our new hotel, but we are now getting ready to launch in November. The pandemic is on a downward slope in South Africa….People are going on with their lives and are now travelling for leisure, in addition to business travel which has been allowed for a few months now,” he says.
“Hilton Garden Inn Umhlanga Arch boasts world-class smart technology that is linked to a mobile app, which will make it easier for guests staying at the hotel to use lifts, access their rooms as well as control lights, the TV and aircon via their cellphones,” he notes.
He claims that this makes it one of the “first completely smart hotels in the world” to be launched.
“It gives us a competitive edge both in the business and leisure market as the pandemic will mean people will still [be] being cautious in their travel choices.… With the hotel also being part of Umhlanga Arch, an all-new mixed-use business and leisure destination, we believe it will attract people from Gauteng and other parts of the country that traditionally descend on Durban over the festive season,” adds Thompson.
“We’re expecting a massive influx of domestic tourists over December, especially from the landlocked provinces.
“South Africans are unlikely to travel abroad this year considering the country’s international travel ban still being in place and the need to plan ahead for such trips,” he points out.
The hotel’s developers strategically opted to open an international four-star hotel within Umhlanga Arch, since most of the hotels around Gateway are three- and four-star locally-operated brands.
Along the nearby Umhlanga Rocks beachfront, the five-star market is covered by the Oyster Box and Beverly Hills hotels, while a new Radisson Blu hotel is also being developed as part of Vivian Reddy and Rob Alexander’s Oceans Umhlanga joint-venture development, which stalled last year. (Moneyweb understands the Radisson hotel component of the project has now resumed construction).
Moneyweb reported last year that JSE-listed Tsogo Sun Hotels is also considering a major expansion of its Beverly Hills Hotel, which was built by renowned hotelier the late Sol Kerzner, back in 1964.
“We saw a gap in the market for a premium four-star hotel that is operated by a globally recognised hotel group. Hilton is the perfect partner and [has] done very clever market analysis, which led to us deciding to open South Africa’s first Hilton Garden Inn within our development,” says Thompson.
He adds that the retail and office components at Umhlanga Arch are majority let, while the residential tower is virtually sold out and 60% of residents have already taken up occupation.
Michelin-star-rated restaurant and lounge planned
“The residential tower is one of the tallest buildings to be built in Durban for years. We are planning to open a Michelin-star-rated restaurant and lounge on the top two floors of the tower … However, our Legacy Yard restaurant area on the retail and commercial side will open on October 1,” he notes.
Andrew McLachlan, Hilton’s managing director for development in Sub-Saharan Africa, says the group is thrilled to be opening its first Hilton Garden Inn in South Africa within the Umhlanga Arch mixed-used development.
“Hilton Garden Inn is our focused service upscale brand, designed to achieve market-leading performance by keeping development costs competitive,” he adds, noting that it is also amongst the top 5 fastest growing hotel brands in Africa.
McLachlan, a veteran hotel development executive, was headhunted by Hilton earlier this year from the Radisson group, which is also aggressively growing its presence on the continent.
“We see a big opportunity to grow the Hilton Garden Inn brand and some of our other brands in South Africa. The Hilton development team is working on a number of opportunities for Hilton Garden Inn in Johannesburg, Pretoria and Cape Town as either new-build or rebranding of an existing hotel,” he says.
“Our brand-new Hilton Garden Inn Umhlanga Arch will have a great opportunity to quickly capture its fair share of the returning domestic business and leisure travel in Durban,” notes McLachlan.
Sharing Thompson’s sentiments, he adds: “Hilton expects to have a strong domestic summer season as holiday travellers head to Umhlanga. The recovery of South Africa’s hotel industry is tied to air traffic and connectivity, so it is very important that more domestic flights return to Durban and that our boarders open for international business and leisure travel.”
The Umhlanga Ridge area around Old Mutual’s 175 000m2 Gateway shopping centre has seen a development boom over the last two decades, with JSE-listed Tongaat Hulett converting much of its sugarcane land there into prime commercial land. Umhlanga Arch is located within the multi-billion-rand Ridgeside precinct – a sea-facing site between Gateway and the Umhlanga Rocks beachfront.
Despite Tongaat Hulett’s woes, development within Ridgeside has continued with the imminent completion of Umhlanga Arch in addition to other developments underway. Hilton’s fellow US-based competitor Marriott International is reportedly also eyeing a new hotel development in the area.
“Umhlanga Arch is on a prime site along Lighthouse Drive,” says Thompson. “When we managed to secure the site three years ago, we knew we needed to develop something iconic for Durban. This mixed-used development offers a live-work-play-stay environment.”