Truworths plans to spend R1 billion on a new distribution centre in Cape Town

South African fashion retailer Truworths has outlined plans to build a new 53,000m2 distribution centre in Cape Town. 
 
The centre, equivalent to 7.5 soccer fields, will help the company consolidate its various facilities under one roof. 
 
Truworths announced that the construction of the building will start next month and its completion is expected to be in the next three years. 
 
Business Insider reports that the clothing outlet is working on finalising the design of the building and materials for the new green-certified state-of-the-art distribution centre – the company expects to part ways with R1 billion rand on the project. 
 
Managing director of Truworths, Sarah Proudfoot, says the distribution centre will help unlock efficiencies and complete their enhancement strategy. 
 
“We believe that from a supply chain perspective, the enhancement and improved efficiencies that we’re going to derive from that real state-of-the-art distribution centre will really complete our supply chain enhancement strategy,” Proudfoot said. 
 
It is also reported that the company estimates capital of a staggering R299 million which will be funded by borrowings, over the next two years, and will be reserved for the land and buildings. 
 
Moreover, Truworths said a further R633 million for materials and handling equipment will be funded internally. 
 
“The group (Truworths) concluded a suite of agreements with the Atterbury group to establish a 50/50 joint venture that will acquire a 99-year leasehold title to industrial land and develop thereon a distribution centre that will be equipped by the wholly owned subsidiary Truworths Limited and leased to it for an initial period of 15 years,” Truworths said. 
 
The business publication has it that the initial phase of the project will include a 3,000m2 office and a 50,000m2 warehouse which also includes options for future expansions to 70,000m2. 
 
It is also highlighted that the centre is part of Truworths’ partnership they established with property development group Atterbury. 
 
Set to be erected at the 72-hectare King Air Industria in the Mother City, the area also offers on-site infrastructure and it is an advantageous prime spot for the retailer, who will now have easy access to Cape Town International Airport cargo terminals. 
 
Main Image: Truworths/MoneyWeb