COMPANY PROFILE
2014
Midvaal Municipality
Savanna City of tomorrow has it all
company profile
Savanna city of tomorrow has it all Editorial: Colin Chinery Production: James Clark
Affordable housing, sustainable jobs, quality of life; vital elements of the South African dream set to be realised in Savanna City, the R24 billion lifestyle housing development in Midvaal. With work on the ten year project now under way, Midvaal’s Mayor Bongani Baloyi talks to IndustrySA about the achievement and the potential.
For South Africa ‘Affordable Housing’ is not a niche market. It is the market. And 35 km south of Johannesburg, 1500 hectares of earth are now being dug, moved, heaped and levelled; the first stirrings of Savanna City, the largest privately-initiated urban lifestyle developments of its kind in the country. With the aim of placing suburban home ownership in the hands of middle and lower income groups, Savanna City will take nine years to complete and provide 18,400 integrated, mixed income housing units. Demand in the affordable housing sector is high. With an estimated one million homes still needed, only 20,000 units are being developed each year. And that’s without taking future demand into account according to Marius Marais CEO of FNB Housing Finance. And for households’ earnings between R3 500 and R9000 it’s a story of nil supply. So with over 30% of the homes to be fully subsidised and the rest GAP, bonded and rental, mixed income Savanna City’s response to the crisis that won’t go away is impressive. Incorporating schools, churches, clinics, parks and retail/ commercial sites, it’s a development with all the necessary
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amenities for a quality lifestyle. And in what is hailed as a unique feature, Savanna City puts the community at the heart of the development by providing spaces where families can meet and play. But the R24 billion development by Basil Read and Old Mutual’s Housing Impact Fund of South Africa – with further funding by the National Government and the Gauteng Department of Human Settlements – will impact well beyond the residential.
MASSIVE BENEFITS The benefits for the Midvaal economy as well as the greater Gauteng region will be enormous; a total economic impact of R28.4 billion during construction and the creation of 54,900 jobs. The post-construction total economic benefits are put at R12.7 billion. With Savanna City expected to almost double Midvaal’s population in a decade and provide more than 12,000 sustainable jobs, Midvaal Mayor, Bongani Baloyi has pledged Midvaal Municipal authority’s support to the initiative. Emphasising the knock-on economic benefits, he cites recent investments into the area, including Sedibeng Brewery’s
Midvaal Municipality
canning line and Paramount Trailers’ new facility as examples of its commitment to economic growth and ability to create new jobs for the growing population. The Heineken bottling plant near Meyerton and the Ferrero Roche factory are other major private sector investments attracted by Midvaal municipality’s pro-business mind-set. As a result Midvaal has been able to create more jobs for more of its people than anywhere else in Gauteng. Over the past ten years the municipality has achieved an annual 15% economic growth. And at 10%, the current jobless rate compares favourably with the national 25%. Skills training – a perennial national issue – is a crucial element in the post–construction job creation agenda. “In terms of the urban management plan we know that before people can do anything, we need to train them,” says the 26 year old Mayor. “And we need them to train up to the next level and in doing so empower our local people.” A training partnership has been set up with 15 local contractors and the municipality is working closely with the Construction Industry Development Board. “We need to see our contractors graduating and moving up levels so they
can employ more people. And if you look where jobs can be created in local government, it’s in infrastructure upgrades.” Why was Midvaal selected as the location for this major initiative? “There’s a large need for housing, especially for the GAP market - those earning between R3500 and R15,000 - a market the banks are not too keen on supporting. And the fact that we had a prime spot here was an obvious advantage, a location perfect in terms of centrality and transport.
QUALITY OF LIFE – AND BUSINESS FRIENDLY “Another factor is the political stability of the area. Midvaal is also known for the good quality of its life and a business friendly environment.” Unsurprisingly, ‘green’ is an important concept in vision Savanna. “It’s a principal we have given up front and has been accommodated very well. An important point is that there are people living in that space and if you don’t address the green aspect then there is a problem “Many people here commute to Johannesburg. You can still find your village type of living and yet you are still just 18 minutes from the city centre. We don’t want to lose this
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company profile
comparative advantage.” The keys for attracting large scale investment are clear, says the Mayor. “The most important as a municipality is to get the basics right. The second is to ensure that there is a stability and continuity of both senior management and politicians. “This, along with a conducive environment, is crucial for investors. If they want to speak with the Mayor, they shouldn’t have to wait for days. Simply pick up the phone and call the Mayor or Municipal Manager if there’s an issue they feel needs to be urgently addressed. “We understand that the faster we turn around with a decision the quicker they can be on the ground, doing what they should be doing. As a result we have reduced our turnaround times for decision making. We understand our role as a local government and in turn stay out of their space.” Positive dialogue is encouraged by the municipality says Mayor Baloyi: “And where it facilitates progress, compromise. With the interests of the municipality very much in mind, issues need to be balanced out. Instead of a blanket ‘No’, we say, ‘how can we accommodate you and you accommodate us’? This is an approach that has stood us shoulders above the rest.”
HUB POTENTIAL? But while new jobs will be created, Savanna City will not assume the role of a small hub. “We don’t think we will ever compete with Johannesburg or Pretoria. With growth in
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Johannesburg now restricted we see ourselves as becoming an entrepôt for what Johannesburg is doing. Our role is in support of what the north is doing, not competing with it.” Aside from its housing and employment transformations, the Mayor stresses what for him will be the project’s transcending achievement. “This development defeats the old apartheid spatial planning whereby people were separated in communities along racial lines. Instead lower income groups, black or white will be residing, and for me this is the most important point - over and above the economic spins offs and jobs created. Building an integrated community is what I want to do. “We are working hard to make sure the project is a success; financially viable and delivered on time. And for my part I can’t wait for the time when we will be cutting the ribbon, handing over the first keys to the first houses built, and saying - ‘We have made it!’”
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“Midvaal is also known for the good quality of its life and a business friendly environment”
Hatch Goba
Port of Ngqura
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016 360 7400 www.midvaal.gov.za
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