Say goodbye to South Africa’s richest square mile as you know it

South African hospitality giant Southern Sun has entered into an agreement with Liberty to acquire half of the Sandton Consortium properties for around R735 million.

Currently, these properties are co-owned by Liberty and Pareto, which own 75% and 25% stakes, respectively.

On Tuesday, 3 February, Southern Sun announced that this is set to change, with the hospitality giant and Pareto looking to acquire Liberty’s stake.

The consortium comprises many well-known properties in what is often called “Africa’s richest square mile”, including Sandton Sun, Sandton Towers, Garden Court Sandton City, and the Sandton Convention Centre.

For years, Southern Sun has operated these properties under long-term lease and management contracts for Liberty and Pareto.

Liberty is a subsidiary of Standard Bank, while Pareto is wholly owned by the Government Employees’ Pension Fund.

Now, Southern Sun said it has reached a non-binding agreement with Liberty to acquire the Sandton Towers, Garden Court Sandton City, the Sandton Convention Centre and Virgin Active Sandton.

This transaction will see Pareto increase its share in these properties from the existing 25% to 50%, and Southern Sun will acquire the remaining 50%.

Notably, the Sandton Sun hotel will continue to be owned by Liberty and Pareto in their existing proportions of 75% and 25%, respectively, with Southern Sun continuing to operate the hotel under a long-term lease agreement.

The aggregate value of Liberty’s 75% interest in the target assets is R1.10 billion, with Southern Sun’s 50% share equating to R735 million, which will be paid in cash from the company’s available debt facilities.

The hospitality giant, which already owns 85% of its total hotel portfolio, said this deal aligns with its strategy to focus on high-quality, strategically located assets in key metropolitan nodes.

According to Southern Sun, the transaction presents an opportunity to increase the group’s freehold exposure to world-class hospitality assets alongside long-standing partners.