The City of Cape Town has come up with a multi-million rand plan to develop the precinct of its biggest stadium to enhance it public use and revenue profile.

“Today the City of Cape Town’s Council has given its in-principle approval for the granting of long-term rights to use‚ control and manage a large gravel overflow-parking site next to the Cape Town Stadium on Granger Bay Boulevard‚” the city said in a statement.

In its internal evaluation‚ the City of Cape Town said the market rental value of this property‚ comprising a gravelled parking area site of 7‚385 square-meter in size‚ was estimated to be either an upfront payment of R100 million (excluding VAT) or a monthly rental of R750‚000 (excluding VAT).

This rental is valid for a proposed lease term of 25 years‚ with an escalation of 8% per annum.

It is expected to be developed to provide a medium-rise complex of buildings incorporating parking‚ ground-floor retail and commercial components.

Construction value of the site is estimated to be approximately R600-million.

Various cities across the have struggled to keep the 2010 World Cup stadiums profitable as they are expensive to maintain.

The city will retain ownership of this site as a strategic asset as it is situated in a desirable location near the retail hub of Green Point with good access to public transport. It is considered suitable for retail and commercial development.

Various 2010 World Cup stadiums have not been profitable after the even as they expensive to maintain. A move to develop the precinct would enhance the Cape Town stadium as the strategic asset to the council.

‘For many years‚ we have worked in a dedicated and creative manner to come up with options that will enhance the financial sustainability of the Stadium Precinct by encouraging greater public usage. We believe that this proposal contains the appropriate development mix‚’ said deputy mayor Alderman Ian Neilson.