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F1 Track and Retail - Durban

9243 Views 28 Replies 12 Participants Last post by  ToxicBunny
This could be yet another pie in the sky F1 dream like the one in Cape Town, but lets see how this develops. KZN and more specifically Durban, do not have a racing track of any sorts (except for the dated one in PMB). F1 in Durban? To many as far fetched as the Olympics in Durban, but things seem to be moving on many fronts.

F1 insider: Durban Grand Prix?
2010-10-08 08:15

DURBAN GP?: SA could return to the F1 calendar

Author: Dieter Rencken

Is the time ripe for South Africa’s return to the F1 Grand Prix calendar?

That is the question that will be asked in Durban next week when a specially-constituted working group ponders a proposal by a South African company working in conjunction with Abu Dhabi-based investors to return F1 to South Africa at new custom facility to be built in kwaZulu-Natal.

According to documents in the possession of Wheels24, the investors intend building a full F1-specification circuit within a retail, lifestyle, tourism, commercial and technology centre.

A site near Durban’s recently built King Shaka International Airport has been earmarked for development, and a proposal recently presented to kZN’s provincial treasury department.

‘I have been asked by my MEC (MEC Ina Cronje) to investigate the matter and to write a report by the end of the month,’ Clive Coetzee, a treasury official, exclusively told Wheels24. ‘There is indeed a proposal on the table.’

The working group, consisting of various role players, including Abu Dhabi’s Royal Group, Nightbridge Investments (instigators of the quasi-government Gauteng Province Motorsport Company, which recently collapsed in a mountain of debt), the KZN Automotive Cluster, Motorsport SA, Tourism KZN, the Airport and Dube Trade Port will meet on 14 October at the airport to debate the matter.

TRACK LAYOUT: The proposed Durban Grand Prix track layout
Sources indicate there are serious concerns about the legitimacy of Nightsbridge, particularly after the collapse of GMSC, and Gauteng’s decision to the cancel certain contracts entered into by GMSC’s then-CEO Steven Watson – a close associate of Nightsbridge – plus the overall financial viability of the project.

Grand prix attendances across the world are dwindling on account of astronomical ticket prices.

The average Grand Prix ticket is currently priced at R4000, meaning a family of four faces a bill of R16 000 before costs of accommodation and travel.

In addition, the KZN treasury department requires that the national government commit financial support for the project. ‘However, if the national government is not willing or able to support the development then the proposal should not be considered. KZN Provincial and local government simply should not get involved without national government support’ concludes the document.

Proposed economic impact on South Africa:

Circuit - R1.8 to R2.5bn
Foreign tourism spend - R500m per annum
Domestic tourism spend - R100m per annum
Event hospitality - R300 – 350m per annum
Accumulative net direct spend per annum - R2-3 billion per annum
Job creation - 7000+ jobs sustained per annum
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New bid to revive South African GP

By Jonathan Noble and Dieter Rencken Friday, October 8th 2010, 06:13 GMT

A group of South African businessmen working in conjunction with Abu Dhabi investors are trying to resurrect plans for the country to regain a Formula 1 race.

AUTOSPORT has learned that a proposal is being evaluated for a purpose-built track to be built near Durban airport as the group behind the efforts eye a 10-year contract to host the event.

In exchange for building a £200 million venue, the group wants the local authorities to help support the plans by paying the £36 million per year race fee plus leasing it the land.

The track, which will also feature retail and tourist attractions, will be based on the design originally pencilled in for Gauteng Province but which fell through.

The ambitious plans for the project have not yet convinced the local government though, and the scheme's backers - Nightsbridge Investments and Abu Dhabi's Royal Group – have been advised to make an approach to the national government for assistance. All the parties involved will meet again on 14 October to discuss their next steps.

South Africa last hosted a grand prix at Kyalami in 1993, which was won by Alain Prost in a Williams-Renault.
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Well, this is an interesting twist on matters.

I personally have no interest in motorsport so am not wild about this idea. I also feel this won't be financially feasible. I feel authorities should keep their eye on the Olympics and leave the F1 dream to CT. The glamour associated with F1 is good promo for a city but overall, given the plunge in F1 fortunes recently, I don't think this will be a sustainable investment. That said, if it's going to take place in Durbs, the North is the right setting for this.
Given that Nightsbridge are involved, I hope the government steer WELL clear of it...

I love the thought of having an F1 track in my backyard and think we could do an awesome job of hosting it... but not with NightsBridge involved in any way shape or form.

Like roman, I'm also skeptical about the financial viability of the idea in any case.
Just looking at the 2nd article, I can't see local officials or even provincial officials paying R400m per annum (escalating) for a 10 year period. The returns must comfortably exceed this outlay for this venture to be worth it and I think this money could be spent on other social investments or even other sporting infrastructure vs a track for one sport that most people won't be able to access because of high ticket prices.
I agree. Like the ambitions in Cape Town, these F1 dreams do seem pie in the sky. Both cities cannot afford outlays like that.

That said, Durban does need a track for it cannot currently even host local meets and that is a problem with the massive racing fraternity in Durban...and possibly leads to the large number of drag meets.

More detail on this will be great to see. Interesting on the Abu Adabi connection though...
There are less facts in those articles and more made up stories than I have ever seen. Firstly GP attendances are not dwindling because of ticket prices, they are dwindling because F1 races are going to countries with no interest in motorsport (or little interest) Bahrain, China, Turkey, Hungary, South Korea. Any of the established races in Europe have sold out races.

The average ticket price is not R4000, the grandstand tickets for 3 days are certainly in that range but you can easily get a 100 Euro ticket for the Sunday race.

The race fee is not 36 million Pounds, nowhere near, more like half that.

South Africa cannot afford to build a circuit from scratch !
Well we have to look at long term sustainability, F1 does bring in a lot of money to the host cities as well as a lot of expenses. Other events? Westbank V8's & of course the International V8 series which was planned for Nov that got scrapped. MotoGP could be another possibility & also local drags...
there is alot of potential in it for other uses other than F1 if it went ahead.

Grantl I do not watch any form of motorsport, but i do clearly remember reading reports this year on the state of F1 and they clearly said that crowds were falling everywhere including the key European hubs, excluding the UK. Germany had supposedly got its worst crowds in many years.

The reason F1 is going all these far flung places is simly because Bernie and co need new fools to buy into their money making scheme...ala FIFA
Hopefully this goes through regardless of whether F1 does indeed return to SA, as, as has been said, Durbz needs a track.
eeeerr we have a track its called kyalami, why not spend a 1/10th of that and upgrade?

Im amazed daily at the crazy schemes in sa that piss money away
As in anywhere in the world, developers are entitled to make proposals.
An article from a few months back, note the highlighted parts...

Premium racing returns to Durban

2010-06-24 14:10

Durban motor racing fanatics may soon get another major event, after the city successfully hosted the A1 Grand Prix for three consecutive years, mayor Obed Mlaba said on Wednesday.

"We have a proposal that has been accepted by the provincial government. The only thing that we have to do is look at costs before a final decision is taken,” Mlaba told Sapa.

The company, which Mlaba didn't name, had made the proposal because it liked how the city and the provincial government hosted the A1 Grand Prix between 2005 and 2008.

“The provincial government is very keen to see it getting off the ground. We are very excited about it. I can't say where it will be held. It may be a bit different from the previous racing event.”

The A1 Grand Prix was held on a 3.2km street circuit near the beachfront. The cost of staging it, including broadcasting to at least 14 countries worldwide, creating a street track and management costs, came to around R91.6 million.

The money was paid by the provincial government and the city of Durban. The three-day event in 2006 attracted more than 105 000 spectators.

The A1 Grand Prix was taken to Johannesburg but ended in its second year. Mlaba believed there was a need for a permanent motor racing event in Durban.

“The world cup has taught us that we have to have landmark events. Permanent events.” He felt these would be a success because the city and the private sector had the capacity to host them.

“Our International Convention Centre is doing very well because of the events. We need more events in our city.”
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Nice balanced article. lets see how things a feeling the provincial government might not go with this, others thoughts?

Now It’s Durban’s Turn…

Don’t get too excited about the possibility of Durban hosting a South African Formula One Grand Prix in the near future. Like other such recent, abortive proposals, it has a very slim chance of succeeding.

Talk of the eThekwini municipality and the province of KwaZulu Natal possibly throwing its collective name into the hat to host a South African Grand Prix in the near future emerged earlier this week, along not dissimilar lines to proposals for Cape Town and Gauteng in recent years.

Without going into too many details, both of these folded mainly because of the need for taxpayers to partially fund such projects and authorities baulking at the idea of trying to sell this concept politically.

The basic proposal looks as follows: Local authority to make available land to private investors (at a very cheap price of course) for them to build a facility, including a state-of-the-art Formula One circuit; private investors to build said facility at their own cost, but then reap all the commercial benefits from its use over a long period of time; local/provincial authority to fund F1’s annual hosting fee in order to guarantee the holding of a Grand Prix.

It is mainly this last element that usually becomes an insurmountable hurdle, as politicians find it very hard to justify to their constituents what amounts to exorbitant and unsustainable spending of taxpayers’ money.

From what I can gather, the same people who were involved in the failed effort to bring Formula One to Gauteng are now behind the proposal for KZN – to the extent that they have even included the exact same suggested circuit design in their proposal. The proposed venue is an area of unused land north of the new King Shaka Airport.

The figures are staggering: The cost of the proposed developments, including the race track, will amount to between R1.8 and R2.5 billion (and we all know how inaccurate such estimates can be), while the annual hosting fee (the money that’s paid to Bernie Ecclestone’s FOM concern) will be – and I have this from other sources too – between R140 and R280 million, depending on rand/US dollar exchange rates. This totals between R1.4 and R2.8 billion over a 10-year period, not including an annual escalation of about 10%, which could more than double this amount.

Try justifying this sort of expenditure in a country sorely lacking investment in more pressing social and economic needs!

The rational argument that state expenditure is based on budget allocations and that spending money on such projects doesn’t mean curbing spending in other areas may well be true, but it’s a difficult concept to grasp for all but the most informed few.

The other (valid) argument that holding events such as an annual F1 Grand Prix generates huge benefits for the local, provincial and national economies, and industries such as tourism, not to mention the positive international exposure for the country, also doesn’t wash in the eyes of those who only focus on expenditure.

South Africa is not alone in this.

In Australia, where the state of Victoria covers the operational shortfall of its Melbourne event to the tune of tens of millions of dollars every year, opposition is – and has been – steadfast, if ineffective.

Great Britain, where the motorsport industry is one of the country’s largest, is the only country with zero state funding of some kind for its Grand Prix because neither Labour nor Tory governments have had the stomach to try and convince voters otherwise, while in Texas, where a US Grand Prix is mooted in the state capital of Austin from 2012 – along virtually the exact same lines as the KZN proposal – opposition is mounting.

Make no mistake: I would love to see grand prix racing return to South Africa…it has been, after all, a passion of mine for all but the very first few years of my life. And I don’t buy the argument that hosting an annual race will detract from local motorsport – if anything, it is what got me and I would argue most other people who became involved in any of an array of roles interested in the first place.

But reality is it probably ain’t gonna happen any time soon.
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For those of you unaware but interested, a possible F1 track in Durbs was the headline story in yesterday's Sunday Tribune.

Main points:

1. Track could cost approx R2b and a piece of land near KSIA has been identified as a possible site for the track.
2. Mike Sutcliffe stated the Pronvical government is driving this initiative and the city was not involved. The city would fully support the initiative if private sponsorship was involved.
3. Dube Tradeport officials are part of the discussion.
4. Everyone linked to the initiative is refusing to comment, neither confirming nor denying that talks are taking place in furtherance of this initiative.
Given that Nightsbridge are involved, I hope the government steer WELL clear of it...
Todt: No South African GP for five years

Friday, 15 October 2010 22:45

FIA president Jean Todt has said that he thinks that it is unlikely that the African continent will see Formula One return for at least five years, despite some early suggestion of a return for the South African Grand Prix.

The party pooper ruins Bernie's '37 races a year' plan.
Formula One has been absent from the African continent since the South African race disappeared from the calendar at the end of 1993.
But recent developments have suggested that the race could be rekindled in the near future, with Bernie Ecclestone known to be interested in returning to South Africa.

He targeted the country with Russia as being his two main new events following the confirmation of the return of the United States GP for 2012.

He signed a contract with Russian authorities for a new race at the Black Sea resort in Sochi from 2014.

A report earlier this month suggested that a new South African company called "Nightsbridge Investments", with backing from Abu Dhabi, were looking to launch a new GP bid, building a new £200 million track near the city of Durban.

But although Ecclestone suggested earlier this year that he could see the sport returning to Africa within three years, Todt has suggested that it might take longer than that.

"At the moment it's only some rumors about some interest for some countries in Africa to organize a Formula One event but I don't see any opportunity in the next three to five years," he lamented during an FIA visit to Kenya on Friday.

Todt's comments back up the thoughts of the boss of Motorsport South Africa, George Nyabadza, who said earlier in the year that he would only be happy to see money spent on an F1 bid should more investment be made in national motorsport.

He went on to suggest that instead the continent should be looking to rekindle their rallying history.

"Africa is a fantastic field to organize road racing," Todt went on, "It could either be WRC or even the Cross Country.

"We are talking with promoters over the possibility to have long-stage rallies incorporated and we are looking at different opportunities to get the best solution from Africa, Europe, Asia and all over the world."

Kenya hosted the Safari Rally round of the WRC until 2003, but it was dropped from the schedule over safety concerns.
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Jean Todt is a complete arse, he thought people of SA didnt even know what F1 was last year.

Though I must say if this was 2 seasons back I would have said no since F1 was becoming so boring and predictable but this season has been unbelievable! F1 is def getting its cred back.
F1 cannot survive on its own. Any sort of development or F1 event in the country will need the right city, aggressive marketing, a legacy for motorsport, and a consistent calendar of sports/non-sports events.

It will also require city and provincial funding with the majority of the risks linked to the private consortium which in itself risks a city's reputation when/if this consortium goes bust.
Agreed. But if i look at all the F1 track proposals in SA over the past few years, this is the one that stacks up better, simply due to the fact that it is a new track into a region that does not currently have one (whereas the others proposed would canabalise existing tracks). KZN is a market that is heavily into motorsport and i can see the track being used alot over weekends for events and an alternative to drags.
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