A trailblazing alliance between the Passenger Rail Agency of South Africa (Prasa) and Eris Property Group is ushering in a fresh chapter in public transportation and student lodging in Cape Town. Set to benefit more than 3,000 students, the R1.4 billion joint investment development of Cape Town Station will offer a much-needed enhancement to the city’s student accommodation options and invigorate the surrounding area with upgraded retail spaces.
A Distinctive Collaboration to Address Urgent Needs
This momentous collaboration between Prasa and Eris Property Group represents Prasa’s inaugural co-investment endeavor. The development, which has already reached 88.8% completion, seeks to address the urgent requirement for student housing in the city. By February 2024, 3,200 new beds will be accessible for NSFAS-eligible students.
Moreover, the project aims to alleviate the housing crisis for Cape Town’s students by also redeveloping a 7,000 square meter retail precinct to boost foot traffic and enhance the overall commuter experience. Prasa Group CEO Hishaam Emeran anticipates the retail precinct to be fully functional by November 2023.
A Groundbreaking Model for Integrated Urban Development
Cape Town Station’s mixed-use property development serves as an excellent illustration of how public transport hubs can be transformed into prosperous centers for work, leisure, and living. Annette Lindeque, CEO of Intersite, Prasa’s asset investment company, elucidates that the project embodies a novel vision for urban development, centered on creating transit hubs that augment the passenger and customer experience.
This inventive method to urban development stretches beyond Cape Town Station. Prasa is already striving to create similar investment agreements with private property developers to unlock value and achieve its secondary mandate.
Broadening the Reach: Social Housing near Goodwood Train Station
The partnership between Prasa and Eris Property Group extends beyond student accommodation and retail precincts. The two organizations have also teamed up to create a separate social housing project near the Goodwood Train Station, which will supply over 1,000 low-cost housing units for Cape Town residents.
The project’s first phase, costing approximately R575 million, is nearly 70% complete. Prasa plans to welcome the initial group of residents to the new development by the end of October 2023.
The Goodwood station social housing project exemplifies the potential of cross-sector collaboration and public sector partnerships in producing socioeconomic and commercial value. It also highlights the crucial role Prasa can play in urban development by promoting commercial and residential development near transit hubs.
Prasa’s Secondary Mandate: Real Estate Investment and Development
The Cape Town Station and Goodwood Train Station projects form part of Prasa’s wider secondary mandate, which includes real estate investment, development, and urban telecommunication. Through its property division, Prasa Corporate Real Estate Solutions (CRES), and special-purpose investment vehicle, Intersite Asset Investments (Intersite), the organization administers rail stations, retail spaces, offices, residential spaces, and land.
Prasa’s secondary mandate intends to generate market-related returns through leasing property and co-investment on developments, positioning the organization as one of South Africa’s largest intermodal transport landlords.
A Promising Future for Cape Town
With the ongoing cooperation between Prasa and Eris Property Group, the future seems bright for Cape Town’s students and residents seeking affordable housing options. The innovative mixed-use development at Cape Town Station, as well as the social housing project near Goodwood Train Station, represents a new model for integrated urban development that prioritizes the needs of the community and enhances the overall urban experience. In the years ahead, Cape Town will undeniably serve as a shining example of how public-private partnerships can drive positive change and redefine the way we live, work, and play in urban spaces.
