Battle lines drawn over proposed CTICC share sale

The Centre That Pays Its Way - But May Pay Even More on the Market

Cape Town International Convention Centre (CTICC) sprang to life in two leaps: the first halls opened in 2003 on the Foreshore, the second wave arrived in 2017 as CTICC2 crossed Helen Suzman Boulevard on its own elevated deck. Together they deliver 112 000 m² of rentable floor, anchored by a 1,500-seat auditorium, 33 000 m² of column-free exhibition zone and 3 000 parking bays. Roughly 600 000 delegate-days walk through the doors every year and, according to the city’s own impact modelling, roughly 7 200 jobs - direct and indirect - depend on that footfall.

The centre’s buying power ripples far beyond the CBD. Exhibitors, organisers and visitors pour more than R4 billion into the regional economy each year. Spend filters south-east to the Winelands, east to the Overberg and along the Garden Route. Even the pandemic hiatus failed to sever the flow; the CTICC has already clawed back calendar space and in 2024 upgraded its data backbone to 10-gigabit fibre - one of the very few African venues that can stage hybrid in-person-plus-virtual shows without hiring expensive satellite uplinks.

Yet the City of Cape Town insists the complex is still under-utilised. Occupancy hovers near 45 %. Yield-management systems used in Dubai and Singapore suggest the same halls could rise to 65 % within five years if a private operator gains the freedom to chase price-elastic demand. That single percentage-point jump would, proponents argue, push the centre past break-even for any new owner and boost municipal revenues through rates, bed-levy and VAT spill-over. Whether the city should remain landlord or take the cash and run - that is the debate now gripping council chambers.

Shareholding Jigsaw and the Golden-Share Safety Net

Ownership sits inside a bespoke company called CTICC Company (RF) Proprietary Limited. The firm holds the buildings and operates under a 25-year concession renewed in 2021. Two share classes matter. Ordinary equity is split between three investors: Cape Town Metro (72.7 %), Western Cape Government (a minority slice) and JSE-listed Sunwest International, the same group that runs GrandWest Casino. Separately, the city keeps two “golden shares” that cannot be sold or diluted; one blocks any change of use away from “convention and exhibition activities”, the other forbids any sale or mortgage of the underlying land without council approval.

An exit price tag of R885 million comes from Deloitte Corporate Finance, applying an income-capitalisation model at a 10.2 % discount and 2 % terminal growth. Because the stake is unlisted, the figure is non-binding; it is simply the number council papers carry when they talk about “monetising the asset”. Both co-investors own pre-emptive rights. If either matches the offer, the city must sell to them first. If both waive, only then can the stake go to an outside buyer through private treaty or auction.

The concession deed forces any would-be purchaser to respect the centre’s public purpose. Halls may not be turned into offices, casinos or condos. Heritage zones wrap around the original harbour breakwater, so even façade alterations trigger provincial oversight. In short, the buyer gets a cash-flowing business, not a blank redevelopment cheque.

Why the Cash-Strapped Council Wants Out

Cape Town’s draft capital budget for 2025/26 shows an infrastructure backlog of R17.7 billion across water, sanitation, electricity and roads. The city’s June 2024 liquidity ratio - cash and short-term investments divided by current liabilities - sat at 0.71, the thinnest cushion since 2010. Selling the centre, officials argue, would instantly raise equity for five flagship projects:

• A third seawater desalination package at Monwabisi (R1.8 billion);
• A bulk sewer outfall to Macassar wastewater works (R1.2 billion);
  -30 million litres per day of extra supply from the Atlantis aquifer scheme (R620 million);
• Removal of 120 km of asbestos water pipes in Philippi and Nyanga (R480 million);
• Smart-grid ring-fencing for Khayelitsha and Mitchells Plain (R450 million).

The R885 million cash injection would unlock roughly R6 billion in blended-finance debt from development banks - the New Development Bank and African Development Bank are both courting Cape Town for climate-resilience work. Officials insist the sale is not about plugging a day-to-day deficit; it is about swapping an under-leveraged asset for urgently needed public works whose benefits will outlast the next election cycle.

Critics reply that the dividend stream - R34 million in 2024 - is steady, visible and growing. A 2023 Intellidex study commissioned by provincial treasury calculated that the centre generated R7.9 billion in gross value added between 2019 and 2022, despite two years of pandemic shutdown. Their conservative scenario sees cumulative GVA of between R42 billion and R50 billion over the next 15 years. Under that light, cashing out looks like trading a golden goose for goose dinners.

Political Fault-Lines, Precedents and the Road to 2026

When Johannesburg sold 13 % of the Sandton Convention Centre to an Emirati sovereign fund in 2018, it triggered a constitutional showdown. AfriForum and the municipal workers’ union argued the deal short-changed taxpayers. The Constitutional Court ruled narrowly in Johannesburg’s favour during 2022, but set a new precedent: any sale of a “strategic municipal asset” must prove the proceeds enhance long-term public value, not merely avoid short-term borrowing. Cape Town’s legal office has already circulated an internal memo warning that the CTICC disposal invites similar litigation.

Civil society is mobilising. Reclaim the City and Ndifuna Ukwazi filed objections in the public-participation window, warning that sale proceeds could be skewed toward already advantaged districts. They cite the 2023 spatial-development framework showing 46 % of capital spending historically flows to neighbourhoods where household income exceeds R20 000 per month. UniteBehind has asked the Auditor-General to verify whether the valuation satisfies the Municipal Asset Transfer Regulations of 2016, which require a public-interest test and socio-economic impact assessment.

The procedural road map stretches into late 2026. Council has already passed an in-principle resolution. Next comes a Section 14 notice under the Municipal Finance Management Act, likely in July 2025, followed by a tender for an independent transaction adviser (Deloitte’s earlier valuation may bar it from bidding). Environmental and heritage clearances must run their course because CTICC1 sits within a protected harbour zone. A final council vote will need a two-thirds majority because the asset exceeds 5 % of the city’s total balance sheet. If co-shareholders waive pre-emptive rights, transfer can happen by 30 September 2026.

In the wings sit global precedents and creative finance. Barcelona Fira lives under 40-year concessions; Melbourne keeps full state ownership but outsources hotels. Vienna sold out in 2002, then bought back 25 % after the global financial crisis hurt revenues. Locally, advisers are also modelling two off-balance-sheet structures: spinning the land into a listed REIT with the city retaining a golden share, or a 30-year sale-leaseback with a refurbishment escrow. Either route would drop the city’s debt-to-revenue ratio from 42 % to 38 %, the threshold S&P rates as key to maintaining Cape Town’s AA- national scale credit rating.

For now the centre keeps hosting medical congresses, oil-and-gas expos and the occasional Comic Con. On the sidelines, hoteliers lobby for a moratorium on new competing space, unions demand job security clauses, and diplomats whisper that a private operator could turbo-charge Cape Town’s 2027 BRICS finance-ministers bid. Every stakeholder has a red-line wish-list. The only certainty is that the silence after the final gavel in September 2026 will echo louder than any applause rolling through the auditoriums today.

[{"question": "

Why is the City of Cape Town considering selling its stake in the CTICC?

", "answer": "The City of Cape Town is considering selling its 72.7% stake in the Cape Town International Convention Centre (CTICC) to raise R885 million. This money is desperately needed to fund critical infrastructure projects, including desalination plants, sewer upgrades, and water pipe replacements, as the city faces an infrastructure backlog of R17.7 billion and a low liquidity ratio of 0.71."}, {"question": "

What is the current economic impact of the CTICC?

", "answer": "The CTICC is a significant economic driver, contributing over R4 billion to the regional economy annually. It supports approximately 7,200 direct and indirect jobs and hosts around 600,000 delegate-days each year. Even after the pandemic, it has shown strong recovery and invested in advanced 10-gigabit fibre infrastructure, making it a leading venue for hybrid events in Africa."}, {"question": "

How much is Cape Town's stake in the CTICC valued at?

", "answer": "Deloitte Corporate Finance has valued the City of Cape Town's stake in the CTICC at R885 million. This figure was derived using an income-capitalisation model with a 10.2% discount rate and 2% terminal growth. However, this valuation is non-binding as the stake is unlisted."}, {"question": "

What protections are in place to ensure the CTICC remains a convention center after a potential sale?

", "answer": "The City of Cape Town holds two 'golden shares' that cannot be sold or diluted. One of these shares specifically prevents any change in the CTICC's use from 'convention and exhibition activities.' Additionally, the concession deed mandates that any purchaser must respect the centre's public purpose, ensuring it cannot be redeveloped into offices, casinos, or condos. The underlying land also cannot be sold or mortgaged without council approval."}, {"question": "

What is the timeline for a potential sale of the CTICC?

", "answer": "The procedural roadmap for the sale extends into late 2026. Following an in-principle resolution by the council, a Section 14 notice under the Municipal Finance Management Act is expected in July 2025. This will be followed by a tender for an independent transaction adviser and the necessary environmental and heritage clearances. A final council vote, requiring a two-thirds majority, would then take place. If co-shareholders waive their pre-emptive rights, the transfer could occur by September 30, 2026."}, {"question": "

What are the arguments against selling the CTICC?

", "answer": "Critics argue that selling the CTICC would be short-sighted, as it consistently generates a steady and growing dividend stream (R34 million in 2024). A 2023 study by Intellidex estimated the centre generated R7.9 billion in gross value added between 2019 and 2022, and projects cumulative GVA of R42 billion to R50 billion over the next 15 years. Opponents view the sale as 'trading a golden goose for goose dinners' and warn of potential legal challenges, citing precedents from the Johannesburg Sandton Convention Centre sale. Concerns have also been raised about whether the sale proceeds would benefit all districts equitably."}]