Tourism has improved markedly in the past year but the industry is still far from its healthiest and it will take a significant amount of time for it to perform strongly again.
Growthpoint Properties’ group CEO Norbert Sasse spoke to investors in a market update in the middle of June, where he explained that crowds of tourists wanted to visit the country now that it was opening up after the worst of the Covid-19 pandemic. However, prospective visitors are facing challenges. There is a cost of living crisis in the UK from where many of SA’s tourists hail and high fuel prices across the world are making air travel prohibitively expensive for many people. Even renting cars is costing up to double what it did pre-pandemic.
Growthpoint is the largest property company in Africa, with total property assets worth R164.6bn. It has exposure to SA and the rest of Africa, Australia, the UK, Poland and Romania.
The real estate investment trust (Reit) holds a 50% interest in the V&A Waterfront in Cape Town, with its share valued at about R6.3bn. The V&A is most highly-valued commercial asset in SA.
Sasse said Growthpoint was optimistic that SA would enjoy a bumper festive season driven by international tourists to the likes of the V&A. Challenges however existed around the strength of European economics and confidence therein, in light of the ongoing war in Ukraine.
But the upcoming tours of the Welsh and New Zealand rugby teams offer hope for SA’s tourism and related sectors.