PICS: Pilgrim's Rest decline has been years in the making - IOL

Pilgrim's Rest's 132-year-old Royal Hotel stands empty, the latest casualty in more than a decade of problems that have seen businesses close and jobs disappear from the historic tourism town.

Recent media reports say the latest attempt to secure an operator for the Royal Hotel has failed, with none of the bids meeting tender requirements. But the empty hotel is only the latest in a series of problems stretching back more than a decade.

The Royal has been part of Pilgrim's Rest since the gold-rush era. According to Artefacts, an online repository of South African architectural and historical information, George Edward Roy, who arrived on the Pilgrim's Rest goldfields as a 19-year-old in 1877, built the hotel in 1894.

Even its pub has travelled a long way to get there – Artefacts says it was originally the Roman Catholic chapel of St Cyprian's School in Cape Town before being dismantled, transported via Maputo and reassembled as part of the Royal Hotel.

Pilgrim's Rest's problems with its state-owned business properties go back much further. A major battle erupted in 2012 after the provincial government put leases for businesses operating from its properties out to tender.

Existing traders were told to leave, including people who had operated businesses in Pilgrim's Rest for years, prompting some to go to court to stop their eviction. The North Gauteng High Court halted the evictions pending a review of the tender process.

The dispute subsequently attracted the attention of then-Public Protector Thuli Madonsela, whose investigation resulted in the Poisoned Processes report. She found the process used to award shop leases was unlawful and improper and had been characterised by "gross irregularities and maladministration".

Among the problems were shortcomings in the bid committee process, incorrect scoring and a failure to establish whether prospective tenants would be able to run sustainable businesses.

By 2018, reports described businesses standing empty and jobs disappearing amid continuing uncertainty over leases.

Existing tenants had been given 30 days to leave, which Madonsela found was insufficient for longstanding businesses to wind up their affairs and make fair arrangements for employees.

Madonsela found the process had prejudiced business owners and the Pilgrim's Rest community and affected the sustainability of the heritage and tourism destination. Government subsequently undertook to cancel the affected contracts and start again.

Yet the town continued to struggle. By 2018, reports described businesses standing empty and jobs disappearing amid continuing uncertainty over leases.

The town's caravan park, once used by visitors, had been without a tenant since 2015 and was falling into disrepair despite repeated attempts by the provincial government to find an operator. The tenders were non-responsive.

In April this year, residents again complained that businesses were closed because of delays in awarding leases, while the provincial government said it was working to revitalise the town.

The Royal Hotel had problems of its own before its current closure. By 2021, there were warnings that dozens of jobs were at risk after the hotel recorded losses of R770,702 and R3.14 million in successive financial years.

Kruger on Sabie took over the hotel in September 2022 and retained its workers, but a labour dispute subsequently developed. According to earlier reports, the operator wanted to introduce a shift system after concluding it could not afford the existing staffing arrangement. The relationship broke down and Kruger on Sabie left.

By December 2024, the provincial government said the Royal had 35 permanent employees who had been left running the business after the previous tenant allegedly ceased operating the hotel without paying employees or giving them notice, before Kruger on Sabie took over and later also left the operation.

The December 2024 announcement appeared to resolve the problem. Following negotiations involving the Department of Public Works, Roads and Transport, Kruger on Sabie, the Mpumalanga Regional Training Trust and organised labour, government said the department would renovate the Royal while Kruger on Sabie would return to run it, with operations due to resume on 1 March 2025.

The hotel's pub was originally the Roman Catholic chapel of St Cyprian's School in Cape Town before being dismantled, transported via Maputo and reassembled as part of the Royal Hotel.

The hotel was still closed when SABC News visited Pilgrim's Rest in April this year. Residents told the broadcaster that businesses had closed, unemployment was high and fewer tourists were visiting.

The department said it was in the process of appointing an operator, but the latest bid round has produced no qualifying bidder – eight years after the caravan park tender also drew only non-responsive bids.

SACCAWU Mpumalanga's Godfrey Talana said he was not aware of the Royal Hotel dispute when contacted by IOL on Monday but indicated that a report on the matter may be forthcoming.

The Royal is also not the only property the government is trying to fill. It has sought operators for other business premises in Pilgrim's Rest as it tries to revive the town's tourism economy, while acknowledging a shortage of tourist accommodation.

Thirteen years after the Public Protector warned that the handling of Pilgrim's Rest properties was harming businesses, the community and the sustainability of the town as a tourist destination, government is still trying to find tenants for its properties.