After more than five years of struggling to get a long-term lease agreement from the Buffalo City Metro, council recently resolved to grant the Border Motorsport Club (BMSC) a 20-year lease for the East London Grand Prix Race Track.
The parties are yet to sign on the dotted line as they finalise the finer details.
But last month, council revoked a resolution taken in 2014 to lease the club 336456m² at an annual rental of R302000 for a “term of 10 years, subject to review”.
The new resolution states that the lease is for approximately 1177331m² in extent for motorsport purposes at a monthly rental of R11800, excluding value-added tax.
The rent will escalate at 12.5% a year for a “term of 20 years taking the magnitude of the proposed development and investments thereof into account”.
The new proposed lease thus drops to R141600 a year and while the old resolution included Waterworld as part of the lease, the new one excluded the facility as it does not form part of the East London Grand Prix circuit.
In the report before council, former acting head for spatial planning and development Sandile Booi said: “The proposed development of this facility will bring motorsport, as well as technology training centres, together as one consolidated venue, which will provide sustainable employment opportunities, skills transfer and the promotion of the metro’s sport tourism.”
Booi said for sponsors to attend to the necessary upgrading of the race track, the Border Motorsport Club needed a long-term lease with BCM of not less than 20 years.
“The investors and development costs involved requires a long-term tenure of security in order to amortise the costs of investments and upgrades to the existing facility.”
ANC ward 46 councillor Nceba Kilimani had no objections to the new proposal.
He told the Daily Dispatch yesterday the development would be good for his ward as jobs would be created and tourists would flock to the area.
BCSC public relations officer Dave Kirkman said 2600 direct and indirect jobs are expected to be created over a period of 15 years.
Once the lease is signed by both parties, the club aims to start the first phase of development by February.
“Our development concept is not just to upgrade the track, but to establish a world-class motor tourism destination, which will bring huge volumes of national and international visitors to BCM.
“We are already in touch with Liberty Group, the new owners of Formula 1 and Formula 2/3 (GP2/3), as well as the organisers of Electric GP, MotoGP, Moto2 and Moto3, World Superbike and Historic Grand Prix,” Kirkman said.
“We will be making an application to Treasury as well, as without their support we can’t achieve our full objectives for the city and our part of the Eastern Cape.
“In fact, we have a date already set for our first international event for Historic Formula One cars in November next year.” — email@example.com