Tax lure for future city skyscraper king

Wealthy investors eyeing a lucrative tax incentive are queueing to buy apartments in what will become Cape Town's tallest building.

The 148m Zero-2-One Tower is set to go up on the site of Old Mutual's Exchange Place on the corner of Adderley and Strand streets, and will become one of the CBD's defining buildings.

The skyscraper will contain 624 apartments, and developer/architect FWJK said high-net-worth individuals were lining up to benefit from the tax incentive built into the Cape Town urban development zone (UDZ) scheme.

Director Craig Armstrong said investors would be able to deduct 55% of the purchase price from income tax payments over an

11-year period.

"Building work is due to commence early next year and will be complete by March 2020, when the current UDZ incentives expire," he said.

Armstrong said Zero-2-One would have:

• A public viewing deck, which he expected to become Cape Town's latest tourist attraction;
• A swimming pool, bar, gym, coffee shop and creche on the 11th and 12th floors, all for the use of residents;
• About 740 parking bays;
• 6500m² of shops; and
• 10 penthouses on the top four of its 42 storeys, with a mixture of studio, one-bedroom and two-bedroom apartments below them.

Armstrong indicated that selling prices of apartments would be R39000/m² - R1326000 for a studio and up to R2.73-million for a two-bedroom flat. He said part of the monthly levy to be paid by owners would fund a concierge shuttle service, with a fleet of up to 15 cars on standby to ferry residents anywhere within a 5km radius.

The main objective in designing this R1.5-billion development was to maximise the views of Table Bay, Robben Island and Table Mountain, he said.

Investors in the development will be required to buy "stacks" of between 12 and 15 apartments spread between prime locations and non-prime areas. They will have to pay a deposit of 20% up front.

Armstrong said planning permission had not yet been granted by the City of Cape Town, but FWJK had been in talks with officials for several months.

Johan van der Merwe, mayoral committee member for planning, confirmed preliminary discussions with FWJK. "Pre-consultation prior to the submission of a development application is a value-added service that the city offers to all developers," he said. "It is a red-tape cutting mechanism."

Construction will take place at the same time as the R1-billion 120-room hotel, office and retail complex being constructed across Adderley Street in front of Cape Town station. Van der Merwe would not speculate on how this would affect city-centre congestion.

Zero-2-One Tower will replace the 139m Portside, completed in 2014, as the CBD's tallest building.