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R700m retail and hotel expansion for Nelson Mandela Bay’s Boardwalk Casino

Construction commences on R500m mall component.
The Boardwalk Casino complex will see a doubling of its retail space and gain an additional hotel. Image: Supplied

Sun International’s Boardwalk Casino complex in Nelson Mandela Bay is getting a R700 million expansion that includes the doubling of retail space (to 23 000m2) and a new independent hotel.

Construction on the initial R500 million Boardwalk Mall extension officially commenced on Thursday, following a sod-turning ceremony with investors and local politicians.

The mall component is being developed by noted Joburg-based shopping centre developer Flanagan & Gerard Group, which is an investor and co-owner in the project together with Emfuleni Resorts, a subsidiary of JSE-listed Sun International.

Speaking via telephone following the launch of construction, Sun International CEO Anthony Leeming said an overall investment of more than R700 million is set to be injected into the Boardwalk Casino precinct over the next two years.

“Around R500 million will go into the expansion of Boardwalk Mall, turning it into a fully-fledged convenience shopping centre that will be fully integrated into the casino … In addition, the Capital Hotels Group will be investing around R200 million in a new hotel within the property,” he confirmed to Moneyweb.

Read:

“Flanagan & Gerard is leading the mall development and is a major investor, with a two-thirds stake. Sun International, via Emfuleni Resorts, will own a third of Boardwalk Mall,” he adds.

New chapter

Leeming believes the overall retail and hospitality expansion of the Boardwalk Casino complex represents an exciting new chapter for the landmark property, especially being developed amid the ongoing Covid-19 pandemic.

“The project was planned before Covid-19 hit and was delayed a bit, but we are thrilled that it is going ahead with the commitment of Flanagan & Gerard,” he says.

“This represents the biggest investment in the Boardwalk Casino complex in over a decade – our last investment was around 2010, when R1 billion was invested in a five-star hotel and conference centre, together with an upgrade,” he notes.

Read: Soccer bosses buy Sun International’s Carousel casino licence

“The new development will take Boardwalk to a new level, with a host of new retailers, food outlets and an open-air eventing space … It’s an investment in the future of the property and is expected to bring in more feet, entrenching Boardwalk as a major attraction on the Gqeberha [formally Port Elizabeth] beachfront,” adds Leeming.

Major investor

Flanagan & Gerard MD Paul Gerard tells Moneyweb the group had first approached Sun International about developing a regional mall next to the casino over 10 years ago.

“It did not pan out and since then there have been other retail developments such as Baywest Mall in the city … However, we still saw an opportunity for a smaller convenience and leisure-focused centre as this is a prime site on the beachfront,” he says.

“We started talking to Sun International again in 2018 and finalised plans to launch construction in March last year, but then Covid-19 and the hard lockdown happened. This caused a delay and we had to downscale the development a bit.”

Tenants

Despite the ongoing pandemic, Gerard says he is fully confident in the success of the Boardwalk Mall development, with funding in place from RMB and several major tenants signed up for space.

“These include Checkers, Woolworths, Pick n Pay, Clicks and Dis-Chem. Other national restaurant and leisure brands such as Spur, Nu Metro Cinemas and The Magic Company, which are part of the casino, will be retained in the mall extension as part of the wider retail mix,” he says.

“Flanagan & Gerard has been involved in several major shopping centre developments across South Africa such as Springs Mall, Nicolway, Morningside Shopping Centre, Menlyn Maine [in Gauteng], Ballito Junction [KZN] and Thavhani Mall [Limpopo] … We are really excited about the Boardwalk Mall development in Nelson Mandela Bay, our first retail development in the region,” he adds.

Keeping the water flowing

On the drought and water crisis in the metro, both Gerard and Leeming concede that it is a “major concern”.

Read: Nelson Mandela Bay Business Chamber wants state funding for water crisis

However, they say there are plans to mitigate this in the interim and it will not stop the development.

Water saving and storage innovations will be included as part of the development, and the council has recently approved plans for a desalination plant for the city.

Meanwhile, Marc Wachsberger CEO of The Capital Hotels Group, confirmed to Moneyweb his investment plans around a new hotel within the casino complex.

“We have not signed an agreement as yet, but the deal is being finalised. Our plan is to invest around R200 million in what will be the group’s first foray into the city and the Eastern Cape. It is part of our broader plans to expand in South Africa beyond our current presence in the major cities of Joburg, Pretoria, Cape Town and Durban.”

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Well done – this is exactly what SA needs – more retail space and hotels :-p

These guys have huge cahunas, PE about to hit the wall, a corrupt council, no water looming. Man they must be big….

As if Nelson Mandela Bay needs this.

The building of the casino 20 years ago destroyed PE’s beachfront that until then had been a hugely popular holiday destination. The supposedly “upmarket” shops and restaurants originally in the casino have been replaced with the bargain basement retail chains. These days it looks very much like a township with pollution everywhere. It’s too dangerous to go to the main beach 100m away.

PE’s “beachfront” has since moved to the more secluded beaches that can’t easily be accessed by buses or minibuses or heffalumps.

Perhaps Sun International should look at what other companies are doing and effectively privatising the maintenance of city infrastructure in the face of utter incompetence and a complete absence of governance from the ANC.

It isn’t as if a casino is in any way an upmarket place in any case.

End of comments.

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