3. TOURISM : Tourism development at Molepo Dam
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Opportunity
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An opportunity exists to create an attractive destination for tourists, around the Molepo Dam.
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Nature of the Project
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It is proposed that the development will consist of:
- 40 bedroom lodge at 2-star level
- Conference Hall
- Restaurantt
- Shop
- Education Centre
- Campsite
- Water-based activities
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Rationale for this venture
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The infrastructure around the dam is well developed as water and electricity readily available. There is also a recently tarred road leading to the dam.
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Attractiveness Assessment
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The product that is offered in the Molepo development contains various elements such as:
- Accommodation facilities
- Conference centre
- Restaurant
- Kiosk and shop
- Education centre
- Water based activities.
There are 126 tourist accommodation establishments in Capricorn District, with the biggest proportion being hotels/motels (26.4%) and 3 star facilities (46.9%).
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Opportunity Alignment
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Limpopo’s Tourism Growth Strategy identifies six priority tourism clusters to drive tourism growth in the province. The clusters are:
- Family and recreation
- Mega-conservation
- Safari and hunting
- Golf and game
- MICE (meeting, incentives, conference and events, or business tourism)
- Special interest.
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Key Competitive Advantage
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The development at Molepo will attract tourists who travel along the R71 to the Magoebaskloof area. This route is also used to get to the northern parts of the Kruger National Park. It will provide 64% of the rooms in the market, however the target markets are different between the Molepo end the existing competitors.
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Potential Economic Impact
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The Molepo Dam development is projected to require 50 employees. The project will therefore create job opportunities, promote entrepreneurship and encourage skills training of the labourers.
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Investment Requirements
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The Molepo development is financially viable. The initial investment needed is projected at R13.5 million. Gross operating revenue is projected to reach over R11 million and profit projected at over R3 million by year five. The project has an ungeared, pre-tax IRR of 18.8%..
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Linkages
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The approximate investment for the proposed project is set on R13.5 million (at 2008 prices).
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| Note: Molepo Dam and Sego Game Reserve can be undertaken as a single investment opportunity because of their close proximity to each other. |