North End Lake sports tourism projects ready for funding

Residents of the Bay and audiences abroad are noticing the re-emergence of the Nelson Mandela Bay Stadium in key conversations and as a serious consideration for mega events.

In the past week, we unveiled a new state-of-the-art investment into the stadium precinct.

The multimillion-rand electric vehicle charging station investment by the Automotive Industry Development Centre Eastern Cape is confirmation that the diversification of revenue streams and stadium offerings is gaining ground.

Earlier in October, the Mandela Bay Development Agency (MBDA) unveiled a new initiative, the Home of Legends Cup, a special tournament that will see Golden Arrows, Chippa United, Mamelodi Sundowns and Kaizer Chiefs go head-to-head for the opportunity to bag the inaugural tittle.

When Council appointed the MBDA in 2016, it was on the strength of the entity’s ability in precinct development, and that is why the mandate to develop the North End Lake land was complementary to the management of the facility.

When taking office in June 2023, it became apparent to me that the entity was far behind in its commitments, hence the acceleration of these initiatives.

After internal and external consultations with key partners including the owners of the facility, the Nelson Mandela Bay Municipality, the MBDA prioritised six key initiatives that we believe could present the city with a unique commercial opportunity.

We then appointed a credible team of urban economists to undertake a pre-feasibility and business planning exercise for these six potential business concepts.

The concepts identified include:

• A floating jetty on the lake;

• A cruise vessel/barge on the lake;

• A Legends Walk;

• An action sports complex/high-performance centre;

• An annual iconic sporting event/festival; and

• A boutique hotel on the banks of the lake.

A pre-feasibility study serves as an initial assessment of the business concept’s viability.

Specifically, a pre-feasibility study provides a “go” or “no-go” decision based on preliminary assessments, including market demand, rough estimates of capital and operational expenditure.

The short-term priorities will be those business concepts that exhibit immediate demand, pose minimal risk and can be implemented over the next one to two years.

The Legends Walk and iconic event/festival business cases currently present the greatest potential to be viable, with a relatively low investment cost.

These attractions tap into the municipality’s existing tourism and community engagement, serving both locals and tourists.

The initiatives are estimated to provide returns on investment ranging from 1.3% to 44.5%.

The level of risk is assessed as low, as these initiatives rely on established, existing demand and infrastructure.

To maximise the opportunities, the MBDA will implement robust marketing campaigns and collaborate with an established events industry and tour operators to ensure these activities attract a wide audience.

The floating jetty, including the adjacent event space, and cruise vessel/barge are anticipated to be developed in conjunction with one another.

It is notable that both business concepts can be secured in the short-term and could, with effort, become a premium attraction for tourism.

An investment into the floating jetty and a cruise vessel is required and this initiative is suitable for a concession arrangement with a rate of return of 14.0% (floating jetty and event space), and 23.9% (cruise vessel).

The action sports hub presents itself as a medium-term initiative with a term horizon of about three to five years.

It has the potential to become a key development in the region, however, its success is contingent on securing an anchor sports team or tenant.

It is estimated it will bring returns ranging from 2.6% to 5.8%.

Regarding long-term priorities, the boutique hotel falls into this category due to absence of sufficient demand currently.

The proposed boutique hotel adjacent to the lake and stadium could serve athletes, support staff, and event visitors.

However, current demand is insufficient to justify this development in the short- to medium-term, but it is an initiative we are going to give close attention to.

Given the current momentum at the stadium in terms of a bulging and lucrative programme of events showcasing the Home of Legends Cup, Investec Rugby Championship Cup, and a range of other non-bowl attractions, we are moving in the right direction.

Also, in October we had the privilege of engaging with the SA Rugby Union management to discuss our intentions to ensure the Boks return to their unbeaten home ground, the Bay stadium, in 2025, which is a common vision from both sides.

All these new initiatives are critical to increase foot traffic at the stadium, especially during off-season, and the MBDA is committed to pursuing them as our core mandate, to develop the stadium and North End Lake precinct into a commercially viable node that contributes to the economic prosperity of the Bay.

Anele Qaba, MBDA CEO

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