The Nova Group, a leading South African property developer, has already begun construction on ‘The Hyde’ development, which is scheduled to be completed by October 2008.

Investors will be offered a 30 day investor usage allowance, and for the remainder of the year, The Hyde will offer short term rental opportunities to the film industry generating revenue all year round.

“Investments in short term rental developments are prone to the risks typically associated with the tourist trade. The Nova Group has identified the need to create an investment which offers decent yields that are consistent throughout the year. The Hyde therefore targets the film industry, which continues to be active in the off-season period when hotels traditionally struggle to fill beds,’ explains Rob Stefanutto, MD of Lew Geffen Sotheby’s International Realty, Atlantic Seaboard Group.

The Nova Group has appointed Amazing Spaces - the Western Cape’s leading provider of accommodation and locations for the film industry- as the operator of The Hyde.

The development has been customised to suit the needs of the lucrative film market. Each apartment will be sold fully furnished, with a garage and a lock-up store room designed to house film equipment, props and costumes. Each of the 36 apartments will be fitted with five-star finishes and hotel grade furniture, resulting in a luxurious accommodation option.

Based on the projected success of the product, the developers are guaranteeing a 7% return on each unit for the first two years of investment.

“A return like this is double what most investors are earning on straight rental in the Cape Town market,’ says Rob Stefanutto.

Amazing Spaces’ Managing Director Julia Finnis-Bedford believes that given the right circumstances, the units can ultimately achieve 20% returns on capital.

Units start from as low as R1 350 000 with a 10% securing deposit. The Hyde will be zero-rated for VAT purposes, thereby allowing investors to sell their apartments without the transfer duty penalty that they would pay on a commercial property. 

“We have worked with the Nova Group and other role players for more than a year, pooling experience in our various industries to bring this product to the market. The Hyde’s real and sustainable returns will ensure its success beyond the 2010 hype,” says Stefanutto.

Stefanutto also comments that the 30 day investor usage allowance is ideal for foreign investors who wish to both visit and invest in the Cape. The development provides a month’s worth of premium accommodation for the investor, and the added bonus of good rental return for the balance of the year without the hassle of dealing with rentals and tenants.