Property Developer February 2015 by SAPOA

Developer

PROPERTY

February 2015

Moruleng City

The North Westâ&#x20AC;&#x2122;s future metropolis of massive opportunity

Mall of the South: a retail sensation

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Residential revival: growth for the future

2015/01/14 2:18 PM

from the CEO

Consulting on integration

STBB TOWNSHIP DEVELOPMENT: ONE-STOP MANAGEMENT The Units are headed from the Cape STBB’s Specialist Township Development Town, Stellenbosch and Menlyn branches. Units – our in-house divisions dedicated Having planning renewedand hislocal appointment, Developer Consultant For assistance, contactAndrew director Barker continues to work to municipal Philip Steyn at the Cape office, government law, property development with SAPOA as the organisation’s representative to the Town Johannesburg Metropolitan 021 406 9100. and related environmental matters – Municipality in respect of the City of Johannesburg’s Integrated Development Plan provide a one-stop support and guidance service to all our developer clients.

n light of keeping abreast of the latest updates Comments were made to the effect that the regarding the City of Johannesburg’s Integrated current approach through community-based Development Plan (IDP), SAPOA appointed planning using clusters of wards is appropriate a service provider to ensure that the relevant for residential communities with a common focus information is provided to SAPOA members, and on their area and local issues. that formal comment is submitted on behalf However, for the business community of SAPOA to the Johannesburg Metropolitan recognition needs to be made of the different Municipality in respect of the IDP. economic sectors and value chains to design an THE system for engagement. After a tender was issued inMASTERING February 2014, appropriate INTRICACIES SAPOA appointed Developer Consultant Andrew Development and investment in the city is HOME Barker with the approval of theOF SAPOA Board. often impaired and hampered by inadequate bulk SAPOA has approved the secondOWNERSHIP appointment of services in certain areas. SAPOA recognises that Barker to work with the 2015/2016 IDP. many projects have been initiated to address the The City of Johannesburg is promoting more backlogs and inadequate supply. active participation of citizens in the preparation, Because of the nature and processes of review and implementation of the IDP through development taking time to be completed, it active citizenry, community-based planning and is important that the budgeted programme of calling for partnerships with business. infrastructure projects be managed and monitored. SAPOA CEO SAPOA wishes to take a more proactive role This should be in terms of their delivery and Neil Gopal in city strategy and policy development and completion, and done in such a way that developers implementation, and to build credibility as a and investors are able to track progress relative to participation. He has also placed emphasis on meaningful role-player in the economic and social their own projects. the need for the public participation process growth and development of the city. While there appears to be a number of projects, to improve radically. Participation and engagement with the city in interventions and initiatives included in the IDP Thus the time is suitable for SAPOA to make the review of the IDP provides an opportunity to and budget proposals, there is no explicit and comments as the IDP process is currently being create a better environment for the property sector transparent plan of action, or programme for the reviewed. It would be important to make SAPOA’s to do its business. It enables SAPOA to submit planned projects and expenditure regarding the stance evident to the City of Johannesburg. ideas and suggestions regarding problems and management and upgrading of infrastructure. Having said this, Barker has made sound issues at a strategic and operational level. If the city is planning to spend R107-billion comments thus far, and continues to actively In addition, it is an opportunity to contribute over the next 10 years, it is essential that this engage with the City of Johannesburg while to city growth and development by guiding the expenditure is planned and accounted for in advocating for the interests of the commercial preparation of the City Spatial Development a transparent and open manner, and included property industry. He has proven to be Framework, and influencing the preparation of in the IDP. knowledgeable with regards to the IDP as well capital and operating budgets. The 2015/2016 IDP has been published for as local government strategies. THAN JUST With input from its members, SAPOA has comment. In light of key aspects of the IDP that Going forward,MORE Barker will be working very THE PAPER WORK defined the objectives of the IDP and continues affect the interests of the commercial property closely with the SAPOA Developers Forum in to encourage open debate on the IDP in light of industry, further comments and recommendations an effort to strengthen communication between any actual or potential prejudice that any of the made will be put forward in conjunction with the the organisation and the Johannesburg provisions have in respect of the interests of 2015/2016 IDP to local government in an effort Metropolitan Municipality. property owners and developers within the to influence strategic planning. As far as the consultation process and commercial, retail and industrial property sectors. SAPOA influencing the IDP is a long-term submissions are concerned, there are no details COMMERCIAL LAW | CONVEYANCING | LABOUR LAW | ESTATES Barker submitted comments on behalf of objective because theFAMILY public participation process | provided in the published& document. Reference LAW | LITIGATION PERSONAL INJURIES 3RD PARTY CLAIMS SAPOA pertaining to the City of Johannesburg’s has been questionable. However, the public is made to the process that was followed, and it 2014/2015 IDP, which focused on specific areas participation process has recently been under is noted that the submissionswww.stbb.co.za received will form Cape Gauteng Town 021Premier 406 9100 |part Claremont 673 4700 | Fishthat Hoek 021be784 1580 that concern the commercial property industry, scrutiny and the newly elected of an 021 outreach report will tabled 6400 | Stellenbosch 0012015. 1170 |We Table View 521 4000 such as (but not limited to) the IDP’s economic David Makhura, in Somerset his StateMall of021 the850 Province at Council 021 in June await the021 report. Tyger Valley 021 943 3800 | Menlyn 012 348 1682 | Illovo 011 219 6200 outlook, enterprise risk management, engaged Address, noted concerns, and has called for a Centurion 012 001 1546 | Bedfordview 011 453 0577 active citizenry and service capacity backlogs. review of structures and processes of community Neil Gopal, CEO

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contents

PROPERTY

Developer

2 4 10 12 16 20 22 24 30 36 40

From the CEO

Abland

News Legal matters Face to face: Musa Mbhele Meet Moruleng City SAPI Conference: Making great places Interview: Cornelia van der Bank

Abreal

South retail sensation The residential revival Making its mark Last word: Developing with heart

Developer

PROPERTY

February 2015

Moruleng City

The North West’s future metropolis of massive opportunity

Mall of the South: a retail sensation

ON THE COVER A city with soul, Moruleng City is a new metropolis set to be developed in South Africa’s North West province

Oilgro

Residential revival: growth for the future

FOR EDITORIAL ENQUIRIES email editorial@sapoa.org.za or managingeditor@sapoa.org.za. Published by SAPOA, Paddock View, Hunt’s End Office Park, 36 Wierda Road West, Wierda Valley, Sandton PO Box 78544, Sandton 2146 t: +27 (0)11 883 0679 f: +27 (0)11 883 0684 e: sales@sapoa.org.za Editor in Chief Neil Gopal Editorial Advisor Jane Padayachee Managing Editor Mark Pettipher Editor Candace King Copy Editor Ania Rokita Production Editor Dalene van Niekerk Designer Dirk Knoesen Sales Riëtte Stevens Finance Susan du Toit Contributors Eugenia Makgabo, Anne Schauffer, John Martin Photographers Val Adamson, Michael Glenister, Mark Pettipher DISCLAIMER: The publisher and editor of this magazine give no warranties, guarantees or assurances and make no representations regarding any goods or services advertised within this edition. Copyright South African Property Owners Association (SAPOA). All rights reserved. No portion of this publication may be reproduced in any form without prior written consent from SAPOA. The publishers are not responsible for any unsolicited material.

P R O P E R T Y

Printed by Designed, written and produced for SAPOA by MPDPS (PTY) Ltd e: mark@mpdps.com

F U N D

e: david@rsalitho.co.za

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from the CEO

Consulting on integration Having renewed his appointment, Developer Consultant Andrew Barker continues to work with SAPOA as the organisation’s representative to the Johannesburg Metropolitan Municipality in respect of the City of Johannesburg’s Integrated Development Plan

n light of keeping abreast of the latest updates regarding the City of Johannesburg’s Integrated Development Plan (IDP), SAPOA appointed a service provider to ensure that the relevant information is provided to SAPOA members, and that formal comment is submitted on behalf of SAPOA to the Johannesburg Metropolitan Municipality in respect of the IDP. After a tender was issued in February 2014, SAPOA appointed Developer Consultant Andrew Barker with the approval of the SAPOA Board. SAPOA has approved the second appointment of Barker to work with the 2015/2016 IDP. The City of Johannesburg is promoting more active participation of citizens in the preparation, review and implementation of the IDP through active citizenry, community-based planning and calling for partnerships with business. SAPOA wishes to take a more proactive role in city strategy and policy development and implementation, and to build credibility as a meaningful role-player in the economic and social growth and development of the city. Participation and engagement with the city in the review of the IDP provides an opportunity to create a better environment for the property sector to do its business. It enables SAPOA to submit ideas and suggestions regarding problems and issues at a strategic and operational level. In addition, it is an opportunity to contribute to city growth and development by guiding the preparation of the City Spatial Development Framework, and influencing the preparation of capital and operating budgets. With input from its members, SAPOA has defined the objectives of the IDP and continues to encourage open debate on the IDP in light of any actual or potential prejudice that any of the provisions have in respect of the interests of property owners and developers within the commercial, retail and industrial property sectors. Barker submitted comments on behalf of SAPOA pertaining to the City of Johannesburg’s 2014/2015 IDP, which focused on specific areas that concern the commercial property industry, such as (but not limited to) the IDP’s economic outlook, enterprise risk management, engaged active citizenry and service capacity backlogs.

Comments were made to the effect that the current approach through community-based planning using clusters of wards is appropriate for residential communities with a common focus on their area and local issues. However, for the business community recognition needs to be made of the different economic sectors and value chains to design an appropriate system for engagement. Development and investment in the city is often impaired and hampered by inadequate bulk services in certain areas. SAPOA recognises that many projects have been initiated to address the backlogs and inadequate supply. Because of the nature and processes of development taking time to be completed, it is important that the budgeted programme of infrastructure projects be managed and monitored. This should be in terms of their delivery and completion, and done in such a way that developers and investors are able to track progress relative to their own projects. While there appears to be a number of projects, interventions and initiatives included in the IDP and budget proposals, there is no explicit and transparent plan of action, or programme for the planned projects and expenditure regarding the management and upgrading of infrastructure. If the city is planning to spend R107-billion over the next 10 years, it is essential that this expenditure is planned and accounted for in a transparent and open manner, and included in the IDP. The 2015/2016 IDP has been published for comment. In light of key aspects of the IDP that affect the interests of the commercial property industry, further comments and recommendations made will be put forward in conjunction with the 2015/2016 IDP to local government in an effort to influence strategic planning. SAPOA influencing the IDP is a long-term objective because the public participation process has been questionable. However, the public participation process has recently been under scrutiny and the newly elected Gauteng Premier David Makhura, in his State of the Province Address, noted concerns, and has called for a review of structures and processes of community

SAPOA CEO Neil Gopal

participation. He has also placed emphasis on the need for the public participation process to improve radically. Thus the time is suitable for SAPOA to make comments as the IDP process is currently being reviewed. It would be important to make SAPOA’s stance evident to the City of Johannesburg. Having said this, Barker has made sound comments thus far, and continues to actively engage with the City of Johannesburg while advocating for the interests of the commercial property industry. He has proven to be knowledgeable with regards to the IDP as well as local government strategies. Going forward, Barker will be working very closely with the SAPOA Developers Forum in an effort to strengthen communication between the organisation and the Johannesburg Metropolitan Municipality. As far as the consultation process and submissions are concerned, there are no details provided in the published document. Reference is made to the process that was followed, and it is noted that the submissions received will form part of an outreach report that will be tabled at Council in June 2015. We await the report.

Neil Gopal, CEO

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Con

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from the CEO

196

THE REAL IN REAL ESTATE

property, people, purpose & passion

ANNUAL SAPOA INTERNATIONAL

CONVENTION AND PROPERTY EXHIBITION

DURBAN - ICC 19 - 21 MAY 2015 ! e t a d e h t e v a S

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on record

Nu-Hold subsidiary Krisp Properties is on track to open South Africa’s latest rail-side shopping centre in Langa in March 2015

Developers gear up for robust growth in 2015 D espite labour unrest and poor economic growth hitting South Africa’s construction industry hard in 2014, a handful of companies, such as national developers Nu-Hold, have managed to defy the odds with robust growth. Nu-Hold, the holding company of Krisp Properties and Nu-Way Housing Developments, has projects under way in Johannesburg, Cape Town and Port Elizabeth, and is anticipating further growth – both for itself and within the industry at large – during 2015. This comes on the back of a report by professional network services provider PwC stating that, after an average increase of new construction work of 3,5% in 2014, the construction industry is growing stronger and looks poised to support the country’s infrastructure development. The company’s portfolio has been boosted by the interest from a host of high-profile blue-chip enterprises in its 21 000m² GLA Clearwater Office Park development, adjacent to the planned OR Tambo aerotropolis precinct. Pepsi – through its South African company Simba – recently set up its headquarters at Clearwater. The plush, custom-built R70-million Pepsi headquarters joins those of other South African blue-chip companies, including Michelin Africa, Discovery Health, Barloworld,

Old Mutual, Absa and Bidvest Air Cargo. Referring to the demand for AAA-grade space within its Clearwater Office Park, Nu-Hold Executive Director Jordan Mann said, “We have found that there is increasing demand for top-class developments whose location has been carefully plotted and which have cutting-edge design and finishes.” So great is the demand that the office park is having to almost triple in size. The future expansion, according to Mann, will more than double the size of the existing office park, taking it from 21 000m² GLA to 60 000m² GLA over the medium term. The company has added an average of 6 000m² of commercial space per year at the office park. When complete, there will be seven AAA-grade unique office park precincts within the project. “We see ourselves as the forerunners of what is happening here at the OR Tambo aerotropolis,” Mann said. “It is a modern office park that has high traffic volumes along Atlas Road and high visibility.” Other Nu-Hold projects set to come on stream this year include the country’s latest rail-side shopping centre in Cape Town’s Langa township. When it opens in March 2015, Langa Shopping Centre will boast a 5 100m² specially tailored pedestrianised shopping

The thorn in the property owner’s side

he Alien and Invasive Species Regulations, which came into force on 1 October 2014, are expected to have far-reaching consequences for property owners. This is according to Terry Winstanley, Director and National Environmental Practice Head at Cliffe Dekker Hofmeyr. Winstanley explains that the National Environmental Management: Biodiversity Act No. 10 of 2004 (Biodiversity Act) was enacted to provide for the management and conservation of South Africa’s biodiversity, protected species and ecosystems. The Alien and Invasive Species Regulations were implemented to

support the Act’s objectives. “The Biodiversity Act provides that anyone carrying out ‘restricted activities’ must hold a permit before such activities may validly be undertaken,” explains Winstanley. “Importantly for property buyers and sellers, the Regulations impose various obligations on persons owning property where listed alien invasive species are growing. These include the obligation on the seller of a property, and subsequently the buyer, to apply for a permit. The Regulations also oblige the seller of the property to notify the buyer in writing of the presence of listed invasive species on that property.”

centre to cater for the more than 45 000 commuters who use the station daily. The construction comes on the heels of the City of Cape Town’s investment in pedestrianising the area with paving, and landscaping the station forecourt and access roads. Also hitting its stride in 2015 are plans for the company’s flagship development, Coega Ridge on the outskirts of Port Elizabeth, which aims to be South Africa’s largest holistic housing estate with up to 40 000 housing units being built at a cost of R6,5-billion. After being given the green light to proceed with the development in August 2014, Nu-Hold subsidiary Nu-Way will commence with town panning this year, hoping to break ground by mid-2016. “This is essentially a satellite city with light industrial space, a regional shopping centre, and supportive community facilities such as schools, a university and a technical college, a hospital and commercial opportunities,” said Mann. Mann noted other exciting projects in the pipeline included 39 plush cluster homes in Pretoria’s prestigious Waterkloof Heights suburb; a 5 500m² hotel at Clearwater; a 35 000m² office park in Bryanston; a 9 000m² shopping centre in Olievenhoutbos in Midrand; and an industrial development in Olifantsfontein. “Given the strong demand for our developments in 2014, we are anticipating solid growth during 2015 as the construction industry begins to recover along with the economy, and as many of our developments begin to come to fruition,” said Mann. The company already boasts successes that include Randburg Office Park, Ebony Park Shopping Centre in Midrand and Sandton Office Park. The group has also completed more than 65 000 affordable and subsidised housing units throughout South Africa, as well as more than 700 up-market residential stands at Clearwater Estate, adjacent to the Clearwater Office Park. +27 (0)11 789 3334, Nuway.co.za

Gareth Howard, Candidate Attorney in the Environmental Practice, notes that this stands to have potentially far-reaching consequences by requiring property owners to take steps to ensure the early detection and, if necessary, eradication of alien and invasive species on their properties. “Significantly,” says Howard, “penalties for non-compliance with these provisions include a fine not exceeding R5-million and/or imprisonment for a period not exceeding 10 years; and in the case of a second or subsequent conviction, a fine not exceeding

R10-million and/or imprisonment for a period not exceeding 10 years. “It is therefore recommended that property owners intending to sell their properties as well as other players in the real estate industry (such as property developers and estate agents) ensure that an appropriate clause is included in their sale agreements, stipulating that the buyer has acquainted himor herself with the property, knows that alien invasive plants are present on the property and understands the legal implications of that.” +27 (0)11 562 1000, Cliffedekkerhofmeyr.com

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Municipal rates and taxes an ever-increasing burden on property owners

Tongaat Hulett partners with BEE consortium via Cornubia

ongaat Hulett’s 12-hectare, 85 000m² Cornubia Business Hub, which was launched in late August 2014, has sold out. The sale, which was concluded during September 2014, sold five subdivisions to two purchasers, with 68 000m² going to a local black-owned company. Michael Deighton, Tongaat Hulett’s Property Executive said that this was the company’s first major empowerment deal in a key area in Umhlanga. “We are confident that it is the first of many such empowerment deals,” he said, emphasising that there were several opportunities in the future roll-out of Cornubia to further reinforce the organisation’s intention to make space for black developers in this key growth and investment corridor north of eThekwini. “We believe that this represents up to a R3-billion investment opportunity for these entities who could construct suitable facilities for a range of end users,” Deighton explained. Speaking on behalf of the BEE consortium, the principal shareholder Paulos Ngcobo commented, “We look forward to partnering with Tongaat Hulett to maximise the potential of this prime

location. As a catalyst for economic development, Cornubia has the potential to create employment and improve the lives of thousands of people.” The bulk earthworks contract for the site has already commenced and is expected to be completed in mid-2015. Construction of internal services such as roads, telecommunications, water, sewerage and electricity will follow. Construction of top structures could commence as early as next year, with trading likely to begin in 2017. Deighton believes that the value of the investment will be fully unlocked by 2017/2018 after the opening of the Cornubia Shopping Centre, which is already under construction by Investec, and the completion of major infrastructure upgrades that include the Flanders Drive interchange on the M41. “Tongaat Hulett will work with the empowerment partners to maximise the value of the development,” said Deighton. “Through the purchase of this property, the new BBBEE entity is expected to evolve into a major player within the commercial property market to the north of the city.” +27 (0)31 560 1900, Thdev.co.za

atest research into municipal rates and taxes confirms what landlords already know: municipal rates and taxes cost twice as much as they did a decade ago, and represent an ever-increasing slice of operating costs. It’s an issue fostering considerable concern, as the growth in rates and taxes has tracked at 2,5 times the inflation rate. The recently released Rates and Taxes Report prepared for SAPOA by IPD examines commercial property rates and taxes in South Africa’s eight largest municipalities. “Rising operating costs threaten the sustainability of net returns across the spectrum of commercial and industrial property investment,” says SAPOA CEO Neil Gopal. “Since the sustainability of the property sector is a key focus for SAPOA, we have been vocal in challenging the basis and consistency of municipal rates charged to our members.” To put some numbers around the issue, consider that total operating costs for commercial properties in 2014 averaged R47/m², of which R11,60/m² went to municipal rates and taxes. That means municipal rates and taxes effectively doubled in real terms since 2000, when rates and taxes accounted for R4,93/m². As Gopal points out, the report concludes that rates and taxes are the second-fastest-growing operating cost item for property owners and investors. Indeed, only electricity costs have risen at a higher pace. “Real increases in rates and taxes have been especially pronounced in the retail sector,” says Gopal. “Since 2007, retail property rates and taxes have grown by inflation plus 11,6%,” says Gopal. The report pinpoints other trends that raise red flags for the property sector. While municipal rates and taxes largely moved in line with commercial property values during the early 2000s, before the global recession, the opposite has been the case since. In recent years, rates and taxes in South Africa have increased at a significantly higher rate than commercial property values. “By June 2014, that growth had resulted in an over-recovery of commercial rates and taxes of about 12%, and there is little likelihood the gap will close in the foreseeable future,” explains Gopal.

The analysis further finds a weak relationship between a property’s market value and the rates and taxes levied. The largest mispricing is in the office and industrial sectors of the market, typically sectors where properties have unique characteristics that could impact their value. Some smaller municipalities could change their rates policies to attract more built investment. Nelson Mandela Bay, Buffalo City and Mangaung all charge commercial property rates over two cents in the rand, a position that is not considered pro-business. “A lower ‘cents in the rand’ rate could act as a catalyst for increase investment flows,” says Gopal. This is echoed by SAPOA’s Regional Chairman for KwaZulu-Natal Edwin van Niekerk, who believes that municipalities would do well to expand the rates base rather than increasing the burden on existing landlords. “Rates and the cost of doing business are a key consideration in corporate location decisions,” he says. “It’s a balancing act that cities get wrong at their peril.” Still, it’s important to consider the context of individual municipalities. “Consider eThekwini, which has large areas of previously disadvantaged communities and a significant need for infrastructure development,” he says. “It’s not realistic to compare that with a municipality that’s fully developed.” The challenge is that property rates and taxes are a key generator of revenue for municipalities. In 2014, property rates and taxes brought in 17% of total municipal revenue for the eight municipalities included in the study. +27 (0)11 883 0679, Sapoa.org.za

SAPOA’s Regional Chairman for KwaZulu-Natal Edwin van Niekerk

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Aveng Grinaker-LTA is building new Netcare Pinehaven Hospital

International launch of Sibaya mega property

ongaat Hulett has embarked on a new chapter in its land-conversion activities with the appointment of Savills (UK) in association with 5th Avenue and the Pam Golding Properties (PGP) Group to launch Sibaya nodes one and five real estate opportunities to an international market. While a total of five nodes make up the first phases of the mixed-use Sibaya development, nodes one and five are being prepared for marketing within the next few months. Node one consists of 50 developable hectares and is located east of the M4 and Sibaya Casino. Node five consists of 76 developable hectares and is situated immediately north of node one and bordered by the M4, the M37 to the north and the coastal town of Umdloti to the east. The appointment of international real estate services provider Savills to market the two properties highlights the potential that this unique landholding offers. With global headquarters in London, LSE-listed Savills, together with 5th Avenue and PGP, offers a leading global platform for the launch of this unique property. In the fast-growing and well-established northern development corridor of Durban, boasting 180° sea views, a backdrop to extensive natural coastal forests and within easy reach of the King Shaka International Airport, the development possibilities for these two Sibaya nodes include major new resorts in conjunction with lifestyle residential accommodation, up-market offices and developments suited to the leisure and hospitality industry. Hotels, conference and entertainment facilities, and retail and recreation facilities would complete the picture. “Tongaat Hulett envisages Sibaya as a unique play-live-work lifestyle that is based on bringing together the best of both urban and natural environments,” says Mike Deighton, Tongaat Hulett’s Property Executive responsible for property development. “These opportunities lend themselves to organisations possessing global expertise and bold vision to maximise their enormous potential.” “Durban has seen tremendous expansion in recent years, with the construction of the new international airport and Dube Trade Port being real statements of intent from the government and local authorities to attract international investment to the region,” comments Daniel von Barloewen, head of Savills International Development Consultancy. “The Sibaya site provides an opportunity to deliver a new destination for Durban to attract international investors, hotel operators and businesses. Savills is delighted and privileged to be partnering with Tongaat Hulett in helping shape the future of the region and attract global investors.” “Found on the rapidly expanding north coast, just 8km north of Umhlanga and 25km from the Durban city centre, these properties are expected to attract significant investment into the region,” says Zamo Gwala of Trade & Investment KwaZulu-Natal. “Trade & Investment KwaZulu-Natal would be available to provide assistance and resources to any new entrants to the market.” “The Sibaya precinct presents a powerful proposition for a catalytic impact on the region,” says Deighton. “Situated within an emerging aerotropolis, there is an appreciation of the vast socioeconomic needs within this broader region. Tongaat Hulett believes that new international investment into Sibaya will provide a substantial boost to the development necessary to address these challenges, enhancing the region’s global presence and branding.” +27 (0)31 560 1900, Thdev.co.za

veng Grinaker-LTA’s R199-million contract to build a new, 100-bed hospital in Pinehaven, Gauteng, for Netcare Properties is well under way. Marc Meire, Divisional MD of Aveng Grinaker-LTA Building, reports that the bulk of the structure is nearing completion. Brickwork, plaster and other wet trades as well as first fix services and bulk services installations are in progress. “We are very pleased to have been awarded another contract through our established relationship with the Netcare Group,” he says. “Despite the steelworkers strike and recent rainfall, the project is on target for completion in August 2015.” The 14 000m², double-storey building, which is situated west of

Johannesburg, near Krugersdorp, comprises a reinforced concrete frame with flat slabs, while the external envelope is mostly made up of brickwork. In addition to the construction of the building, all associated works, including the specialised installations and finishes, are being undertaken

Nedbank finances and takes equity in new value centre for Alberton

edbank Corporate Property Finance has entered into a partnership with Rejem Property Development (Pty) Ltd and Style Star Investments (Pty) Ltd to develop the R450-million Newmarket Value Centre in Alberton. The transaction was made possible through a joint venture between Nedbank Corporate Property Finance’s investment arm (acting through Linton Projects (Pty) Ltd), Rejem and Style Star, a division of the Moolman Group. Linton Projects and Rejem jointly

own 56% of the undivided shares in the project, while Style Star owns the remaining 44%. As part of the greater Newmarket Park mixed-use development being undertaken by Rejem and Linton, the 34 000m² value centre boasts tenants such as Builders Warehouse, Virgin Active, Food Lover’s Market and Checkers Hyper. Restaurants include Spur, John Dory’s, Panarotti’s and Mugg & Bean. The centre is expected to open in October 2015. Ken Reynolds, Regional Executive:

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on record by Aveng Grinaker-LTA. The company has previously completed hospitals in Lesotho, and in Mitchell’s Plain in the Western Cape. The 425-bed Queen Mamohato Memorial Hospital in Lesotho was built for the public-private partnership consortium Tsepong, in which Netcare has a stake, while the 230-bed Mitchell’s Plain Hospital was a contract that was successfully

completed for the Department of Transport and Public Works. “Aveng Grinaker-LTA’s experience in this specialised area is being brought to bear in this contract for the new Netcare Pinehaven Hospital,” Meire says. “We look forward to playing a fundamental role in providing Netcare with the infrastructure it requires to grow its business.” +27 (0)11 923 5000, Avenggrinaker-lta.co.za

Gauteng at Nedbank Corporate Property Finance says the centre is being designed to become an 80 000m² regional shopping centre in time. “The development site is the old Newmarket racecourse, and Newmarket Park is a 77,3-hectare property southeast of the Alberton CBD,” says Reynolds. “It is surrounded by well-established residential areas and there is scope for major development in this node. The bank financed and holds an equity stake in the Makro that opened on the site in April last year, making the value centre our second development in the park so far. “Rejem Property Development and the Moolman Group have

strong reputations in property development, with knowledge and experience. Nedbank Corporate Property Finance is proud to partner with these trusted and successful developers once again. We have established a close relationship with both parties and will continue to be a dependable partner that not only provides agile solutions but also equity partnerships where appropriate. Our continued collaboration with strong developers, as well as our equity stake in developments such as this one highlight why Nedbank continues to lead the market in realising property opportunities.” +27 (0)11 294 4274, Nedbank.co.za

New landmark Pam Golding on Main to utilise ground water

ith the concrete frame of the building now cast right up to third floor and roof level, the new Pam Golding on Main P-grade office and retail building in a busy commercial node in Kenilworth, Cape Town is growing impressively out of the ground at a considerable rate. Situated on the corner of Main and Summerley Roads and developed at a total project cost in excess of R100-million, the 4 100m2 development is set to become a landmark focal point in the area, incorporating a lively streetscape with alfresco dining after working hours. “Passers-by can now gain a good sense of the scale of the building, the design of which will enhance the appeal and ambience of this area of Main Road,” says architect Daniel Nugent of Vivid Architects. With the final section of the concrete roof slab just cast, more or less completing construction of the concrete structure of the building, brickwork is currently being carried out in all areas. Garry Sheard, senior partner at consulting structural engineers De Villiers Sheard, says the main reticulation pipes for the building services such as water, waste water and storm water are being installed, while the basement levels are being cleaned out and brick linings constructed. The area around the site is also being backfilled to bring it back to the level of the surrounding streets. “The look of the building should change rapidly as work is on track for completion towards the end of May 2015,” says Sheard. He says one of the challenges encountered by the contractor on site has been the proximity of overhead electrical cables along Summerley Road, which turned out to be too close to the building for comfort, so construction on that façade had to be postponed while the city council moved the cables. In addition, as Summerley and Main Roads are both busy, congestion around the intersection complicated deliveries to the site. A further issue was the presence of ground water, coupled with the significant amount of rainfall experienced while the large excavation was open to the sky. While earlier geotechnical investigations conducted in early 2001, which were for a shallower basement, showed no evidence of ground water, the addition of a third level of basement parking did intercept water. This has been interpreted as a “perched” water table, supplemented by underground run-off from winter rains. It is expected to diminish over the drier, hot summer months and even dry up completely. “The developer has decided to use this water positively and it will now be pumped to storage tanks, which will be located at ground level, close to Main Road,” says Sheard. “The volume that will be stored will be balanced against the available supply and the demands of irrigation, with capacity of up to four 5 500-litre tanks available. This water has been tested and proved suitable for irrigation, and will be used for the site. The water is collected in a sump in the basement and a float switch used to keep the level to just below the level of the lowest floor.” Pick n Pay will occupy 500m2 on the ground floor with their new small-store offering, which will include a coffee shop and bakery. Pam Golding Properties will occupy over 1 000m2 – the entire first floor and some retail space on the ground floor – while a restaurant is planned for the ground-floor corner site, spilling out onto the pavement. +27 (0)21 426 4440, Pamgolding.co.za

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on record

Building confidence at more than six-year high in 4Q 2014

Metropolis on Park: Sandton’s most striking address

ositioned on Pretoria Street in the Sandton CBD, Metropolis on Park has a prime location that few residential developments can match. Overlooking Mushroom Park, Metropolis on Park will offer investors the balance between city living and park life, where residents will get the best of both worlds, living in an elegant expanse and having abundant space for recreation, play and fitness. “It is a known fact that real estate located in capital cities overlooking central parks attracts influential business people and fetches great investment returns,” says Paul Barrow, Director of Barrow Properties. “Metropolis on Park is no exception.” Kent Gush, a sales agent at Kent Gush Properties, says that of the 126 units there are 120 apartments consisting of studio, one-, two- and three-bedroom simplexes, crowned by six luxury penthouses with roof terraces. “These will be highly sought-after with their unique, integrated park environment, and with all units enjoying magnificent views,” he says. “Construction is well under way and with occupation set for May 2016, we anticipate the building to be fully occupied.” There is a noted sense of space and elegance in the apartments because of the floor-to-ceiling windows offering panoramic views across the park. All apartments are north-facing and, to take advantage of their outlook, each unit has glass balustrades further enhancing the uninterrupted views. GLH and Associates Architects have ensured that urban advantages meet easy living. This contemporary building provides a fibreoptic backbone throughout, ensuring world-class connectivity. Fully integrated kitchens with Miele appliances, Hansgrohe kitchen and bathroom fittings, and Geberit sanitaryware in bathrooms, ensure the finest choices throughout. A 17,5m lap pool and fully equipped gym are the ideal way to maintain fitness without leaving home. Or, if you prefer, you can enjoy a sundowner or a selection from the à la carte menu at the ground-floor café offering indoor and outdoor dining facilities, as well as a “pick-up-and-go food” facility stocking essential home products for your convenience. Meeting rooms and private dining rooms offer full catering services, making Metropolis on Park the ideal work-from-home location. Building amenities include a first-class reception desk, ground-floor café, meeting rooms, private dining suites, and full stand-by power and reserve water tanks. There will be a professional estate management service and a laundry pick-up/drop-off desk for further added convenience. The property is safe and secure, with access control in and out of the building and a private residents’ entrance into the park. Mushroom Park includes a running track, outdoor gym, restaurant, children’s play area, security and birdwatching, offering homeowners numerous leisure amenities on hand. +27 (0)11 727 3600, Barrow.co.za

fter edging up to 45 points in Q3 2014, the FNB/BER Building Confidence Index increased by 15 points to 60 in Q4 2014. “This is the highest level of the Index since the beginning of 2008 and confirms the building sector is experiencing a revival,” said John Loos, property economist at FNB. The current level indicates that more than half of the respondents are satisfied with prevailing business conditions. The rise in confidence was broad-based, with four of the six sectors included in the index registering higher confidence. In the remaining two sectors confidence was unchanged. Main contractor confidence

jumped to 66 index points in Q4 2014, from 53 during the previous quarter. Confidence of both residential and non-residential contractors rose by double digits during the quarter. According to Loos, “although confidence in both sectors improved, the residential market is looking far more buoyant than the non-residential market – a trend we picked up in the last quarter already.” The growth in residential building activity accelerated nicely in Q4 2014. This in turn boosted overall profitability. In contrast, non-residential building activity weakened. “Confidence was higher on the expectation that building activity and profitability

Walking Wonder bridge wins

lobal engineering consultancy firm SMEC was awarded a commendation at the 2014 CESA Aon Engineering Excellence Awards, in the category Less Than R50-million, and received a commendation at the Steel Awards in the Bridge Category for its involvement in the development of the iconic Isando Pedestrian Bridge. The structure is a self-anchored cable-stayed bridge designed to be aesthetically pleasing and economical at the same time. It is one of the largest pedestrian bridges in South Africa and provides safe passage over the R21 highway to thousands of commuters in Johannesburg on a daily basis. A main feature of the bridge is the two un-braced cigar-shaped steel pylons. One leans forwards at 11° and the other leans backwards. John Anderson, SMEC South Africa functional head of structures, states that the layout of these pylons is what led to the bridge being named the Walking Wonder. The bridge connects the Isando Rail Station and OR Tambo International Airport, and replaces two footbridges that were built during the 1970s. Anderson observes that the new footbridge is a vast improvement over the previous structures and is used by approximately 9 000 commuters each day.

“A lot of consideration went into designing the Walking Wonder, as it was necessary to link the rail, taxi and pedestrian transport modes,” says Anderson. “Significant effort was invested in conceptualising the functionality of the bridge to ensure it can be used and accessed by everyone. To ensure the safety of those who use the bridge, the design incorporates multiple access points.” The Walking Wonder features a walkway that is 5,4m wide and offers sufficient space for the commuters who use the bridge during the peak hours of morning and afternoon. The total length of the bridge is 126,4m. The main span of the bridge is 64m long, and is supported by two vertical planes of fanned cables that are anchored to back spans. The use of a torsionally stiff structural steel box girder proved an economical means of supporting the concrete walkway. Anderson explains that torsion is the condition of stress or deformation of a component caused when one end of the object is twisted in one direction, and the other end remains motionless or is twisted in the opposite direction. “This design allowed for the unsymmetrical cable arrangement on either side of the deck,” he says. “The depth of the deck section allowed

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on record will improve in 2015”, said Loos. Sub-contractor confidence rose by three index points to 50 in Q4 2014. The continued improvement in the residential market has boosted activity in other buildingrelated sectors. Retail sales and orders of building material remained robust. As a result, the confidence of retailers of hardware was unchanged at a high 74 index points. Loos noted that “while other retailers are still under pressure, retailers of hardware have benefited from the recovery in the building sector.” Continued growth in domestic manufacturing sales and production lifted the confidence of manufacturers of building materials. Looking ahead, the amount of work conducted by architects and quantity surveyors was generally higher during the quarter.

As a result, architect business confidence remained at just under 50 index points, while that of quantity surveyors rose to 60 index points in Q4 2014. “The increase in pipeline activity supports further growth in building activity in coming quarters,” said Loos. According to the survey, the recovery in residential building activity recorded in Q3 2014 gained noticeable momentum in Q4 2014. This boosted work along the rest of the building value chain. However, non-residential building work slowed further. Furthermore, the rise in activity along the building pipeline suggests that the current recovery is sustainable. However, impending interest rate hikes may halt this fledgling recovery before it can gain more significant traction. +27 (0)21 887 2810, Ber.ac.za

for a cable spacing of 11,4m, which thereby reduced the number of cables needed to support the bridge, and in turn reduced the visual clutter which can be caused by crossing cables.” Sculpted outriggers were also attached to the box. Anderson highlights that these steel elements illustrate the versatility of steel, and created integrated, flowing forms into the bridge’s structure. “These elements were galvanised and painted to reduce future maintenance activities over the highway,” he says. “In addition,

the towers for the bridge were constructed from welded circular sections that taper according to the golden ratio.” Anderson also points out that the bridge serves as a visible marker of the current efforts that are under way to overhaul and upgrade the highways in and around Johannesburg. “In addition to being practical and safe, the bridge was also designed with aesthetics in mind, in the hope that it will be intuitively appreciated,” he says. +27 (0)11 369 0600, Smec.com

Attacq’s new office towers at Lynnwood Bridge earn green five-stars

he latest development phase of Attacq Limited’s Lynnwood Bridge Retail and Office Park has achieved a 5-Star Green Star SA Office v1 Design rating from the Green Building Council of South Africa (GBCSA), placing it among South Africa’s leading green buildings. The final phase of this landmark Pretoria precinct has earned the proud green badge for two A-grade office buildings, Kaaimans and Bloukrans, of a combined 12 000m² with a shared podium, parking basement, visitor parking and security site. Each building comprises six storeys, served by five basement levels and a central atrium. Owned by Attacq, developed by Atterbury Property Holdings and designed by Studio 3 Architects International, with sustainability consultants Aurecon, the iconic office towers are the final phase of the now 75 000m² Lynnwood Bridge mixed-use commercial precinct. “High-quality assets such as Lynnwood Bridge Retail and Office Park play an important role in meeting Attacq’s investment strategy,” says Morné Wilken, CEO of Attacq. “We place a high importance on green building, as it underpins the marketability and competitiveness of our properties and the sustainability of our business, ensures operational savings over the long term, and delivers measurable environmental benefits.” Citadel Wealth Management has moved into about 3 330m² over three floors at the Kaaimans building, where Aurecon, which already has offices at Lynnwood Bridge, has taken the opportunity to expand into 3 590m² on the top three floors, which are linked to its existing building by a link bridge. The 7 223m² Bloukrans building is a flexible, multitenant workspace that is already home to radio station Groot FM, Stratus Computers and Atterbury, which has taken up the entire top floor of the tower. Besides an extraordinary quality environment, the precinct’s strong appeal also benefits from its superb access just off the N1 highway at Lynnwood Road. The offices are well served by public transport, including the Gautrain bus service. The towers are mere steps away from the Lynnwood Bridge Retail development with its vibrant restaurant and retail offering, which now links (via the new Daventry Road Bridge) with the neighbouring Glenfair Boulevard, also owned by Attacq. Attacq now has four GBCSA Green Star SA rated buildings in its portfolio. It also owns Group Five’s cutting-edge new head office at Waterfall, accredited with five office design green stars; Majestic Offices in Newtown, which have earned four office design green stars; and, also at Lynnwood Bridge, Aurecon Tshwane, with its four green stars for office design. +27 (0)10 596 8892, Attacq.co.za

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legal matters

Check your contracts T

Eugenia Makgabo is an Admitted Attorney of the High Court and Legal Manager at SAPOA

When entering into contracts, contractual positions should be thoroughly clarified from the beginning to avoid conflict

he built environment has many key roleplayers. Each has a fundamental part to play from inception to the finalisation of a building project. Construction starts with planning, design and financing, and continues until the structure is ready for occupancy. Architects are usually actively involved. Some of their duties include designing new buildings, extensions or alterations to existing buildings, or advising on the restoration and conservation of old properties. Such duties must be clarified and identified by way of a contract between the architect and the client. From the onset it would be vital for all parties involved to clarify their roles in order for there to be certainty and to enable the avoidance of conflict, which could ultimately lead to the occasional lengthy and expensive process of litigation. The issue in the Holm Jordaan & Partners v City of Tshwane Metropolitan Municipality case concerned an architect’s contractual position. In this instance, a determination had to be made where such architect’s commission in respect of the design of a building is conditional upon a decision to proceed with the project, and final terms are not agreed by all parties concerned.

Considerations

The question that arose before the court was whether there was a contract between the parties in accordance with the terms alleged by architectural firm Holm Jordaan & Partners, hereinafter referred to as the appellant, and the City of Tshwane. The appellant had won a competition run by the respondent’s predecessor, the City Council of Pretoria, for the design of new municipal headquarters for the city. After a few years, changes were made to the original agreement, which gave rise to the city making amendments to the original contract entered into between the parties. The appellant contended that a contract in terms of which it was commissioned as architect for the entire project was concluded in three stages: on 24 April 2003, when the city adopted the resolutions; on 14 May 2003, when those resolutions were communicated to the appellant; and on 4 June 2003, when the appellant accepted the offer made when the resolutions were communicated. A subsequent competition was held in 1998, where the appellant won the right to be

commissioned for the project that was the subject of the competition. The right to be commissioned as an architect for the remaining stages of the project (the first two having been completed as part of the competition) was conditional on funding being found, and was also conditional on the council, and later the city, proceeding with the project. The appellant’s response to that on appeal is that the right may have been conditional on the decision by the city to proceed, but that that condition was fulfilled – and the decision made – when the city passed the resolution to appoint the appellant as the architect. There were attached conditions, which included the fact that the appellant had to enter into a joint venture partnership with a BEE entity, and it was implicit in the resolutions passed and the letter communicating them that funding for the project had still to be found. The city subsequently envisaged a different project when it passed the resolution. It became evident that the project was infinitely bigger in scale and cost than that originally anticipated. The area of the municipal headquarters was considerably greater and the estimated cost had gone from R160-million to an amount in excess of R1,2-billion.

Judgment

The judge held that: The claim that the city had repudiated the contract and was liable for damages as fees lost by the appellant as a result had to be investigated. If the court had found that there was, in fact, a contract concluded between the appellant and the city, it was always the prerogative of the city not to go ahead with the project. No owner is ever obliged to continue with building or even to commence building simply because it has commissioned an architect to design one. The commissioning of an architect does not entail an obligation to build. The architect is entitled to fees for work done and not to fees for the building project as a whole where the project is not commenced or is stopped. The terms of the contract had not been agreed to in terms of the identification of a BEE entity, the way in which the appellant is to be remunerated and the respective roles to be played by the appellant and the unidentified BEE entity. The judge contended that the fact that the aforementioned factors with the inclusion of the

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legal matters

limitation of responsibilities, the fees or methods of calculating them; the provisions of termination; the details of professional indemnity insurance; and the provisions for dispute resolution had not been agreed upon is a concern. The terms are essential to an architect’s commission in terms of rule 3 of Board Notice of 2004 (GG 26143 of 19 March 2014), promulgated under the Architectural Profession Act No. 44 of 2000), which sets out the code of professional conduct for architects. It was highlighted that the standard terms of the appointment used by the city reference to the city having the right to suspend the project, in which case then the architect would be entitled to full remuneration of services rendered and disbursements made till the date of suspension. The terms however also provide for the fact that if a project is resumed or reinstated after a year, the project will be regarded as a “new commission” and fees will need to be negotiated. The judge found that there is no contract commissioning the appellant as the architect for the building of municipal headquarters, contemplated when the city resolved to appoint the appellant, together with a BEE entity in a joint venture, ever materialised. The action had to fail on this basis alone. Further, the judge disagreed with the appellant’s argument that although the building for which it was commissioned was stopped, its mandate continued and that even if a contract had come into existence, the city would not have been liable for damages. The appeal was dismissed with costs, including those of the two counsels.

Consensus and conditions

In order for a contract to be binding between parties, there must be a meeting of minds formally known as animus contrahendi. This is essential for the contract to be legally binding, and essentially this is what distinguishes contracts from non-binding contracts. The existence of consensus will give rise to legally enforceable obligations. It is important for parties to be aware of what constitutes material terms of a contract. These would go to the root of the contract and are crucial regarding the performance of the obligations. If there is no agreement with regards to what is material then it becomes difficult to prove that a contract was in fact in existence.

Elements in the contract that can be defined as being crucial in order for the contract to be concluded may be regarded as material. In the event that conditions are attached to the contract, the agreement between the parties regarding the fulfilment of the conditions becomes paramount. A condition has been defined as an expression between the parties in respect of the agreement on what is to happen to the obligations in the contract on the occurrence of an uncertain future event. It is possible for the parties to agree that the performance of the obligations in terms of the contract will not be enforceable until it is known whether the condition has been fulfilled or failed. The case cited in Holm Jordaan’s case sets out the fundamental element of consensus. This is found in Alsthom Equipments at 93 E-F and states the following: “Whether in a particular case the initial agreement acquires contractual force or not depends upon the intention of the parties, which is to be gathered from their conduct, the terms of the agreement and the surrounding circumstances.”

It is important for parties to be aware of what constitutes material terms of a contract. These would go to the root of the contract and are crucial regarding the performance of the obligations. If there is no agreement with regards to what is material, then it becomes difficult to prove that a contract was in fact in existence February 2015 l property developer

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face to face

Partners in growth We talk to eThekwini’s Acting Deputy City Manager of Economic Development and Planning Musa Mbhele about enabling economic growth and development for all in “South Africa’s playground” By Anne Schauffer

he City of eThekwini’s Acting Deputy City Manager of Economic Development and Planning Musa Mbhele not only has a battery of skills, but also a breadth and depth of experience as a municipal manager and a town planner for the provincial government. Add to that a string of degrees and diplomas, from a Bachelor of Social Science and a Master’s in Town and Regional Planning, to a diploma in Project Management and a BTech in Business Management, among others. Addressing SAPOA’s KwaZulu-Natal members recently about enabling economic growth and development for all in eThekwini, he focused on three key areas: a typical city in a developing world from a global perspective, the eThekwini metropolitan area, and interventions to grow the economy of eThekwini. We spoke to Mbhele to find out more about these core elements.

Q Describe a typical city in a developing world.

The current discourse focuses on cities as the destination for growth, and the resultant impact of city expansion. When you see problems in eThekwini, it’s the typical kind of problem found anywhere in the developing world. We need to start thinking in an inclusive fashion about how we manage our cities, and the strategies we employ to these particular challenges. One of the key things to bear in mind is that, by 2030, more than half of the world’s population will be living in cities. Cities are engines of economic growth and centres of innovation – the battle for a more sustainable future will be won or lost there. The focus is now on sustainable development. If we’re to be responsible business persons and citizens, we need to be doing development in such a way that we meet our own current needs but ensure that future generations are also able to live off Mother Earth without being deprived.

Q Is it exciting to be in the city? Musa Mbhele, Acting Deputy City Manager of Economic Development and Planning of the City of eThekwini (Photograph by Val Adamson)

We have to ask ourselves: if cities are the place to be in, is ours exciting? Looking at specific features common to cities in the developing world, there’s a high level of inward migration, as well as high levels of informality. There’s good informality and bad – illegal development or the invasion of strategic land

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is bad, but informality that encourages economic development, within the auspices of the law, should be encouraged. We have to look at decay in the inner city. In these cities, there are always poor levels of infrastructure maintenance, alongside a diminishing rate base. The city is vulnerable to natural disasters because of an unsustainable growth path. The long-distance commute from places of residence to places of work is historically inherited in South Africa. Every pocket of land is invaded by squatter settlements unless money is invested in security to protect such assets; poverty and unemployment follow, with resultant social ills such as crime and generally lawlessness.

Q What about the eThekwini

Metropolitan Area specifically?

There are certain key economic sectors that make up our city. Being a port city, it’s expected that our manufacturing would thrive. Finance, trade and community services make up the remaining sectors. The total GDP in 2013 was R217,7-billion; the growth over 17 years is 3,7%, and 2,6% between 2012 and 2013. It’s just not good enough to meet the National Development Plan’s (NDP) growth targets – we need more than five percent. Our labour indicators? The big employment sectors are community services, manufacturing and finance. The total formal/ informal employment in 2013 was 1 243 820 – growth over 12 years is 2,8%. It’s not adequate to meet NDP targets – we need a growth of more than four percent. These sectors are quite absorptive in terms of labour: they are responsible for a huge chunk of the labour pool we have, which is in excess of 1,2-million. More of eThekwini’s labour force is in the informal sector than in any other province. All indicators point to the dependence of the unemployed on the few who are employed (we rate second-highest in the six provinces). Whatever we do – in as much as we push for huge profit margins because that’s why you’re in business – the critical corporate social responsibility is that you should also create jobs.

Q Why does eThekwini have the highest dependency ratio on social grants?

Even as we deal with strategies in the townships to stimulate economic development and deal with poverty, the majority of our African people languish in poverty. Out of all six metros, eThekwini has the highest dependency ratio. We have a large indigent population, which means, by law, we are required to provide free basic services. Providing those impacts on our ability to invest in other aspects of economic development such as infrastructure, maintenance and so on. We have competing demands. We have a large influx of people from the former Transkei, neighbouring provinces and countries in search of better economic opportunities. If you’re talking about an inclusive city, it means we have to provide a basic

acceptable minimum level of service to those people. We have a very stretched base.

Q What is the eThekwini investment dashboard?

It’s an indicator of how our economy is doing – those projects we feel are ready to hit the ground soon. Part of my responsibilities is the approval of building plans. People do not ordinarily submit building plans unless they’re planning and ready to build. It shows distribution and shows how many building plans we deal with in which sector of the economy. It shows confidence. We can gauge investor confidence by the level of enquiries – people have already committed by buying pieces of land, making applications to rezone and so on. We have thousands of building plans, but we’ve decided to focus on the big projects – big in impact, size, jobs to be created and so on. We’ve identified 57 of them, which would provide, in a 20year framework, 3 736 674 work opportunities during construction; 617 360 permanent jobs; R8,4-billion in rates income. We believe it’s a clear indication that there is serious economic activity and interest in investing in eThekwini.

Q What challenges

were identified in the stakeholder workshops?

We’ve developed a strategy, not only limited to an industrial one, but rather around what investors/ developers vocalise as the key issues being faced. These give us feedback about how you, as partners, investors and developers, see us. Issues that were raised revolved around excessive red tape, regulations and delays, a lack of proactive planning and bold decisions, overly reactive approach-planning, bulk infrastructure costs, limited municipal finances and developers’ contributions. There is also the relationship between developers and municipalities; and too high land prices, in the hands of a few, need reducing. Some of the broader concerns raised included lack of services and infrastructure costs; rates and financial incentives; the Environmental Impact Assessment Act 70 of 1970; investor confidence and global economic forces/macroeconomic conditions; and broader project management issues and marketing.

“We need to start thinking in an inclusive fashion about how we manage our cities, and the strategies we employ to these particular challenges. One of the key things to bear in mind is that, by 2030, more than half of the world’s population will be living in cities. Cities are engines of economic growth and centres of innovation – the battle for a more sustainable future will be won or lost there. The focus is now on sustainable development”

Q What are you planning

in order to grow eThekwini?

We intend to be Africa’s most liveable city but can’t do it alone. We need support. We need to see reduced unemployment; reduced income and spatial inequality and poverty; creation of sustainable economic growth and development; becoming a global metropolis over the next 20 years. With our port, we have all the makings of a global metropolis. How do we get there? By ensuring we provide economic leadership in such a way that we deliver catalytic growth initiatives and quality job creation, so we address poverty, income inequalities February 2015 l property developer

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face to face

The Moses Mabhida Stadium in eThekwini

“We’ve talked for a long time about a one-stop shop, and now it’s going to happen”

and unemployment. We’ll do this by capitalising on the role of the port, our international airport and potentially modern rail, road and information and communications technology, connectivity and infrastructure. We’re emphasising the potential of the city as the best location for manufacturing activity, and developing the lifestyle aspect of the area for its residents and tourism potential. With careful and proper implementation of the programme, we are going to turn the city around. This is how we intend to promote trade between Africa and the world.

Q What are some of the catalytic

projects being facilitated by the city? There are many, including Dube Trade Port; Tsogo Sun, the Suncoast extension, with an investment value of R1,8-billion, 7 000 construction jobs and 1 500 permanent jobs; Point Waterfront Development Partnership; Keystone Logistics Precinct; Berea Station Development, with its station concourse upgrade and 14 000m² shopping mall; Illovo Auto Supply Park; and Westrich Shopping Mall – catalytic shopping centre development, with an investment of about R480-million.

Q Are we as a city institutionally geared to be able to deliver on all this? If you look at the global competency of cities, they depend on highly competitive organisational staff

and the related culture. There is a perception that our public servants are sitting, drawing salaries from ratepayers and not providing a good service. We, the city, are responsible for ensuring that we change that culture. We won’t be found wanting from the leadership perspective, but we need to strengthen internal economic capacity building and, more importantly, strengthen our partnerships with the private sector. We’ve talked for a long time about a one-stop shop – and now it’s going to happen.

Q What is the “one-stop shop”?

The biggest concerns raised are always issues of bottlenecks, bureaucratic red tape, the time it takes to get anything done or passed. We’ve been listening, and we’re reviving the idea of the one-stop shop. It will seek to provide an elevated level of service for big investments. We’ll continue to improve the mainstream process, but we cannot have vast companies scrambling for advice, data, investment facilitation, info and so on – they must have access to this, readily available at the entrance before they make a decision to commit. It’s going to be worldclass, manned by highly experienced staff. The developer will only have to walk in there a couple of times, and by the end of that process, have an approved building plan and be ready to run. That’s what we’re seeking to do.

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Full

face to face

In hand and online, SAPOA’s South African Property Review has a far-reaching appeal - not only does the print version get mailed to a 2000+ targeted database, it also enjoys a monthly online impression rate of over 3675 hits, with an average read of upwards of six minutes per issue.

www.sapoa.org.za December 2013 / January 2014

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March 2014

REVIEW

AFRICA SERIES Zimbabwe: time to play the market

EMERGING MARKETS Affordable housing and student accommodation

PROPERTY SOUTH AFRICAN

April 2014

REVIEW

PROPERTY SOUTH AFRICAN

RICS A femalepresident ﬁrst

NEW LEASE ON LIFE Urban regeneration and spatial transformation change the game DEVELOPING AGAINST THE GRAIN Harvesting student accommodation

THE BIG DEAL The point when growth changes the way of doing business

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Commuter AXIS to Jo’burg’s rail network

AMAzing contemporary architecture

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MOTHER KNOWS BEST Diving into opportunities in the Mother City

HARBOURING SUCCESS The V&A: a destination in its own right

BOWING OUT Estienne de Klerk on a year of legislation, tabled motions and a commitment to education

Making a difference

The 46th Annual SAPOA International Convention and Property Exhibition

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July 2014

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June 2014

REVIEW

June 2014

2014/01/15 10:31 AM

May 2014

New-age aesthetics

SOUTH AFRICAN

EYE ON AFRICA Mauritius: sun, sea, sand and citizenship

THE WORLD UNDER CONSTRUCTION Construction management: a pillar of development strength

Architecture

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May 2014

REVIEW

AFRICA Mozambique: more than prawns and beaches

April 2014

Alice Lane on show A wonderland of aesthetic excellence

SOUTH AFRICAN

46th Annual SAPOA International Convention and Property Exhibition

BANKING ON DESIGN Setting new standards in interiors

PROPERTY REPORTING ON AFRICA Taking a constructive approach to Africa’s future

March 2014

More than just finance

February 2014

REVIEW

GAUTRAIN Unlocking the property pipeline

February 2014

Banking on green investments

SOUTH AFRICAN

AFRICA SERIES Botswana: from rags to riches

CSI Are you doing your bit?

2014/11/10 2:09 PM

PROPERTY

46th Annual SAPOA International Convention and Property Exhibition: report back and Innovative Excellence Awards

de Lille

Urban design and regeneration

AFRICA SERIES Namibia in focus

December 2013 / January 2014

Broll’s multi-disciplinary property services

Parks

Attorneys, brokers and auctioneers

ECOFRIENDLY MASTERPIECE Efficiently showing off engineering and design aesthetics

Inspired, innovative and independent

s ss s s

Patricia

Construction management

CAPE TOWN CBD City development open for business

THE PRECINCT EFFECT The rise and rise of trendy nodes

MEET RS THE MAYO Tau

REVIEW

South African Property Review

SOUTH AFRICAN

South African Property Review

PROPERTY

South African Property Review

November 2013

REVIEW

South African Property Review

SOUTH AFRICAN

South African Property Review

FACILITIES MANAGEMENT It’s all about integrated service

Showing off modernity Hertford office park

PROPERTY

Architects and architecture

ARROWHEAD Always on target ALL-STAR ASSET SA listed property in the lead

November 2013

Broll’s multi-disciplinary property services

September 2013

REVIEW

GOING THE EXTRA GREEN MILE A very real passage towards sustainability

September 2013

Inspired, innovative and independent

SOUTH AFRICAN

CSI and interior design

SANDTON CITY MOVES UP A GEAR Muller mulls over retail offerings

PROPERTY

s sss s

ies: ser ly ica Afr nthountry Theour mo y-c y-b ntr focus cou

INVESTMENT FUNDING Vunani’s quest for true value

October 2013

September 2013

SASOL’s SANDTON HQ Alchemy brings the magic

October 2013

REVIEW

Engineers & quantity surveyors

ALL-STAR ASSET SA listed property in the lead

PROPERTY

Attorneys in focuos

Project managers

ARROWHEAD Always on target

Attorneys in focuos

August 2013

July 2013

December 2014 /January 2015

SHINE ON, SAPOA Our Convention report back

REVIEW

THE PRECINCT EFFECT The rise and rise of trendy nodes

THE TALENTED MR NOMVETE Delta’s rise and rise

EYE ON AFRICA Uganda: prosperity and heightened development

Cover with spine Dec/Jan_SUBBED.indd 3

PROPERTY

VUKILE’s NEW WUNDERKIND Why Dr Moseneke made the move

Women in property

PROPERTY EYE CANDY Excellence winners announced

Heritage, where the heart is

WALKING ON BROKEN GLASS Women shatter the ceiling

SOUTH AFRICAN

South African Property Review

REVIEW

September 2013

South African Property Review

PROPERTY

SOUTH AFRICAN

South African Property Review

REVIEW

SA REITs The dream becomes a reality

Architects in focus

CSI and education

PRESIDENT’S MESSAGE Amelia Beattie reﬂects on the year to date PROPERTY TRENDS The industrial sector revolution: alive and well

PROPERTY

August 2013

South African Property Review

PAYING IT FORWARD Corporate social investment: not just for seasonal goodwill

SOUTH AFRICAN

South African Property Review

MOTHER CITY HOSTED SAPOA meets the Mayor

July 2013

South African Property Review

REVIEW

SOUTH AFRICAN

South African Property Review

December 2014 /January 2015

South African Property Review

PROPERTY SOUTH AFRICAN

July 2014

REVIEW

OVERALL WIN NE R

Innovative Excellence Awards And the winners are…

YOUR NEW PRESIDENT Meet Amelia Beattie AFRICA Angola: oil-rich and growing fast

REAL ESTATE and the South African economy

WORLD SERIES Global markets in the hot seat

2014/05/19 10:51 AM

Getting your brand noticed by the leading decision makers in South Africa’s commercial property industry - you know it makes sense h nc lau e Re issu

Cradlestone Mall

Retail development under way

February 2014

Modderfontein metropolis

Developer May 2014

Mall of Africa

Shanghai Zendai’s city plan

October 2014

Alexandra township mixed-use development

Atterbury’s retail roll-out: the sky’s the limit

PDP class of 2013

Developer

PROPERTY

Developer

PROPERTY

November 2013

PROPERTY

Developer

Paving the way for future investment

Rewarding the GSB, UCT, SAPOA course

Futuristic dream or visionary future?

Towering feat: a catalyst for investment

Bridging the gap in the City of Tshwane

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Developing an oceanic fairy tale

Cornubia: Durban’s mixeduse marvel

2014/01/15 10:03 AM

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A work in progress

Repurposing industrial buildings

Area review: Remotely on the rise

2014/04/08 8:45 AM

Published quarterly, SAPOA’s Property Developer is mailed out along with it’s sister publication the South African Property Review. The Property Developer is also available online.

Published by SAPOA, Paddock View, Hunt’s End Office Park, 36 Wierda Road West, Wierda Valley, Sandton PO Box 78544, Sandton 2146 t: +27 (0)11 883 0679 f: +27 (0)11 883 0684 www.sapoa.org.za

C o n ta c t Rië tte Steve ns - + 27 ( 0) 71 877 5520 - e mail sales@sapoa.o rg .za February 2015 l property developer

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2:48 PM 2015/01/14 2:46

sector story cover focus

Meet Moruleng City A mega metropolis is on the North West’s horizon – a new and allencompassing city that’s set to transform a rural township into a riveting town of opportunity By Candace King

city with soul is what it’s being called: Moruleng City, a momentous metropolis set be developed in South Africa’s North West province that will bring unprecedented opportunity to the area. Earmarked to serve and become part and parcel of the rural village of Moruleng where the Bakgatla Ba Kgafela traditional community resides in the North West, Moruleng City seeks to harmonise traditional African communal living alongside modern urban design and infrastructure to develop South Africa’s first true post-apartheid city. Moruleng City is the grand vision of the Bakgatla Ba Kgafela Traditional Administration (BBKTA). Since 1996 the BBKTA, under the leadership of Kgosi Nyalala Pilane, has sought to develop its lands and communities through strategic investments in infrastructure and facilities designed to bolster the local economy. Situated at the base of the Pilanesberg National Park, Moruleng City is planned in a beautiful area. Development opportunities at Moruleng City have established it as a major

emerging tourism, educational and commercial hub for the region. The Bakgatla Ba Kgafela traditional community is nestled in a region that’s rich in natural beauty and mineral resources, the harnessing of which has resulted in the development of vibrant tourism and mining industries residing in the region of the Moses Kotane local municipality. Moruleng City will further stimulate the region. The reality of Moruleng City comes at a prime time as South Africa celebrates 20 years of freedom and democracy, which the Bakgatla Ba Kgafela traditional community has prided itself in. The rural community has reflected on its freedom and democracy which it has benefited from, and has acknowledged all its achievements and the progress they have made thus far. In light of this reckoning, Moruleng City does not resemble a development for the people but one by the people – this is the greater dream that BBKTA boasts for its community. Through its Bakgatla Ba Kgafela

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sector cover focus story

Moruleng City master plan, the community is working towards supporting the country’s National Development Plan as well as Vision 2030. The development of rural Moruleng has long been part of an inclusive and holistic master plan concept, in a territory consisting of 32 villages. This has created an economic urban hub, which began with the construction of recreational, transport and bulk infrastructure. Major progress has been achieved in recent years, most notably in terms of bulk service networks in the village of Moruleng. Investment in major water and sanitation bulk infrastructure has given rise to several major developments in the central area of the Moruleng village. These developments include the Moruleng Boulevard; the 22 000-seater Moruleng Stadium; the 34 000m² Moruleng Mall; 15million mega-litre reservoir; the BBKTA head office as well as the Mphebatho Museum and Cultural Precinct. These projects were designed to improve the living standards of the Bakgatla Ba Kgafela rural community, by attracting investments, skilled workers and tourism, and harnessing investor confidence. This is in support of the agrarian transformation strategy, which is aimed at

social mobilisation to enable rural communities to take initiative, and to create sustainable settlements with access to basic services and economic opportunity.

MAIN IMAGE Moruleng City is set to be a city with soul ABOVE Heritage Walk at Moruleng City BELOW The proposed Civic Precinct

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ABOVE Moruleng City’s soon-to-be-iconic tower ABOVE RIGHT Plans for phase 3 of the Commercial Precinct BELOW Moruleng City will be South Africa’s first post-apartheid urban city, complete with all the bells and whistles

Moruleng City design principles • The celebration of local culture and heritage • The development of mixed land use commercial precincts • Civil facilities and spaces based in the heart of the city • Design at a pedestrian scale for maximum access • Centrally located public-transport facilities linked to major road and pedestrian networks • Interlinked public spaces • Incorporation of local sports, arts and culture

The Moruleng City Urban Development Plan (UDP) has been designed to guide all future investments at the city. Seven separate clusters have been identified, with prioritised economic activity ranging from mining, farming and industry to banking, finance and eco-tourism. Cluster three – specifically Moruleng – is set to become the region’s central business, cultural and service node. Several precincts have been designed for Moruleng City, harnessing development opportunities into well-located spaces according to themes. These include a sports precinct; an auto precinct; a wildlife ecoestate; a transport hub; a health and medical precinct; several mixed-use commercial precincts; a cultural precinct; and a hotel and leisure precinct.

Strategic greening and planting of soft landscape is encouraged along all major and feeder roads. Road networks have also been developed to allow for rapid inter- and intra-city transport, transforming the village into a more accessible serviced network for development. Overall, the aim is to encourage growth for the local economy that will benefit the people of Bakgatla Ba Kgafela. The development will transform the Moruleng village into an outstanding African city, bringing people to Bakgatla Ba Kgafela and presenting Bakgatla Ba Kgafela to the world. A village gives rise to a city, and a city such as Moruleng gives rise to a thriving community that will reap the benefits of the future without forgetting where it has come from.

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SAPI Conference

Making great places Chair of the SAPOA National Developers Forum and Project Manager at iProp (Pty) Ltd John Martin reports back on SAPI’s sixth Planning Africa Conference, sharing positive thoughts about a well-planned event

John Martin, Chair of the SAPOA National Developers Forum and Project Manager at iProp (Pty) Ltd

s a SAPOA delegate, I attended the South African Planning Institute’s (SAPI) Planning Africa Conference, hosted at the Durban International Convention Centre from 19 to 22 October 2014. Held every two years, the SAPI Planning Africa Conference is regarded as the premier and largest planning event on the African continent. Its purpose is to promote sustainable spatial development in South Africa and the rest of the continent. The Conference also provides a platform for knowledge exchange, networking and influencing practice. Most importantly, it inspires and supports young planners.

The Conference was attended by local and international policy experts and practitioners from the public and private sectors of planning, government and other built environment professions. With more than 500 delegates attending, the Conference was jam-packed with plenaries, parallel sessions and technical tours, as well as a sumptuous gala dinner and awards ceremony. The Conference aimed to assess the impact of planning in the 20 years of democracy in South Africa, with a special focus on spatial transformation aimed at addressing inequities, and the need for inclusive place-making. The Conference got off to a lively start with keynote speaker Mitchell Silver, a Past President of the American Planning Association and current New York City Commissioner of Parks. He had an interesting take on planning for people by understanding the demographics of the society you are planning for going ahead. But his unforgettable statement was that you plan for experiences, not places. “You go downtown for a party, not to see the land uses,” he said. With the theme of the Conference being “Making Great Places”, Jean-Pierre Elong Mbassi, Secretary General of the United Cities and Local Governments of Africa organisation, went on to explore whether our traditional planning methods are adequate to deal with the urbanisation of African cities. Adding to this question, Dr Nolulamo “Lulu” Gwagwa, Chief Executive Officer of Lereko Investments (Pty) Ltd and former Deputy Director General at the National Department of Public Works, asked whether planners in South Africa can be proud of the places they have planned since 1994, with special reference to housing South Africa’s poor. Minister of Cooperative Governance and Traditional Affairs Pravin Gordhan and Minister of Human Settlements Lindiwe Sisulu led discussions alongside planning practitioners on how to make our cities, towns and villages better places to live in. Minister Gordhan reminded us of planning activism going back to the 1970s, and of those who tried to make “great places” under the very difficult conditions back then. There were many other interesting presentations, and perhaps the most controversial was presented by

Marrit Van Der Schaar, a freelancer working within the sector of social housing and urban planning. Having recently moved to South Africa from the Netherlands, Van Der Schaar is an experienced project manager with an MSc degree in International Development Studies. He pioneered streamlining the planning system in the Netherlands with the Flexible Planning and Transformation of Offices to Living Spaces project. Similarly, urban safety expert Laura Petrella brought international experience to the Conference with her work at UN-Habitat, where she is developing the agency’s urban planning content and activities in partnership with various stakeholders at global and country level. The Conference was characterised by the amazing organisation that went into making it a success – not only the day-to-day organisation but also the preparation of more than 100 papers and presentations especially for the event. Planning Africa 2014 papers and presentations were received in two tracks, namely academic and industry. The bar was raised considerably this time around, with all abstracts and papers having gone through a rigorous upfront double-blind peerreview process. One particularly interesting paper by town and regional planning professionals Johan Olivier and Magdeline Tsotetsi concerned the Magaliesburg Development Initiative; it was titled “A place is not great, not until its user perceives it as such”. The enthusiasm with which the students shared their presentations was extremely refreshing and inspiring. I left the Conference with the impression that the planning profession is constantly reviewing its contribution in an ever-changing environment. The commitment to social upliftment and sustainability in its work is to be admired. We at SAPOA can learn from the weighting the planning profession gives to community participation and satisfying society’s needs in the evaluation of its projects. SAPI President Nthato Minyuku-Gobodo, SAPI Past President Yusuf Patel and the entire SAPI team have much to be proud of. Most of the delegates left the Conference already excited for the next one. Until then!

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SAPI Conference

Planning Africa 2014 by numbers ● Total number of delegates

543

● Sectoral breakdown of delegate representation

Government departments 103 Municipalities 248 Other interest groups and organisations 118 Universities and research 69

● International delegates ● International breakdown of delegate representation Botswana Canada Kenya Lesotho Namibia USA Nigeria

● Total number of papers

1 2 3 3 1 1 2 108

TOP RIGHT Nthato Minyuku-Gobodo, Minister Lindiwe Sisulu and Yusuf Patel; ABOVE Yusuf Patel, Councillor Loganathan “Logie” Naidoo, Mitchell Silver, Dr Lulu Gwagwa, Nthato Minyuku-Gobodo, Minister Pravin Gordhan and Jean-Pierre Elong Mbassi; BOTTOM, FROM LEFT Jean-Pierre Elong Mbassi; Minister Lindiwe Sisulu; Minister Pravin Gordhan

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interview

Planning our future We chat to Cornelia van der Bank, Chief Executive Officer of the South African Planning Institute, about the organisation’s role, current projects and future endeavours By Candace King Photographs by Michael Glenister

f you think a wedding planner’s job is stressful, think again. With apartheid’s spatial framework legacy on its back, the lack of professionalism and recognised training, rapid urbanisation and the rising housing backlog, the South African planning profession has much to stress about. “Planners have realised the challenges they are faced with,” says Chief Executive Officer of the South African Planning Institute (SAPI) Cornelia van der Bank. Planners operating in both the public and private sector have risen to the challenge of addressing the problems, and are now engaging and working with one another to tackle the issues. “Government has realised that there are many challenges, and are addressing the issues, including issues around mining land, inner city development, periphery community development and the massive housing backlog,” says Van der Bank. “Another big issue is the abuse of the systems within government.” Van der Bank says SAPI is committed to dealing with these challenges. SAPI is a professional body with more than 1 700 members, operating as a voluntary, non-profit organisation. It was established in 1996 as an amalgamated umbrella body of town and regional planners for the new dispensation in South Africa. The institute seeks to promote planning that addresses the challenges of our country, and to promote the planning profession. It consists of members from all regions of South Africa and from all sectors of planning, including the public sector, NGOs and CBOs, private consultants and academics. Furthermore, SAPI is the secretariat for the African Planning Association, which consists of 25 member countries. It provides the profession with a profile, an identity and a voice, and it functions as a forum for all people in planning to debate critical issues affecting planning and development.

Changing the challenges

Cornelia van der Bank, Chief Executive Officer of the South African Planning Institute

Van der Bank highlights that, with new legislation being introduced, the planning ball game has become more intricate and somewhat complicated. “As planners, we are committed to making it work,” she says. “In terms of SPLUMA, we are still waiting for the final Regulations. In light of this, SAPI is assisting in the process with the Department of Rural and Land Reform – we are participating in the working groups that the Department has established in order to get the process going. “The public and private sectors are dependent on each other – planning cannot happen from one side. Furthermore, there are challenges on both sides – municipalities also have their own issues and delays.”

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Van der Bank says that other issues include inefficient processes and systems within municipalities; land availability; slow approval processes; and addressing basic services and skills shortages in the built environment. “SAPI is dedicated to skills development and capacity building,” explains Van der Bank. “We have established the SAPI Professional Development Centre, which presents courses to planners to learn about the latest information in the profession.” Another SAPI initiative is the 200 Planner project, which is a three-year mentorship programme for young graduates to gain the necessary knowledge and experience to be able to register with the South African Council for Planners (SACPLAN). SAPI launched a community planning tool kit as part of an ongoing “Know Your Block: Work to Make a Great Place” campaign. This is aimed at activating citizens in their local areas to engage in constructive action with municipalities and stakeholders to make better places, and counter negative and violent service delivery protest actions. “At the 2014 SAPI Conference, we witnessed so many passionate and driven planners who keep on doing good work and improving situations for the citizens of our cities,” says Van der Bank.

Professional planning is imperative In light of collusion and corruption in the field, Van der Bank believes professionalism is important. “Collusion and corruption starts before construction even begins,” she says. “Planners need to play more of an advisory role and need to work within a strategic framework. This is where we need professional trained planners. The planning profession gets a bad name because of ill-informed planners without the training. “We want to work towards job preservation. Planning services are of a high standard and we need to ensure that this standard is maintained. We are working with SACPLAN to get to a certain level of job preservation.” Registered planners are essential, notes Van der Bank. This provides an assurance that the planner at hand is skilled and that all the boxes are ticked. And while experience is important, qualification is equally crucial. “Plans should be submitted via registered planners,” she says. “We hope to get this included in the regulations. We support job preservation for planners and want to ensure that the planning profession is protected.”

Plans for the future Looking towards the future, Van der Bank says that technology and densification will be the focus points. “In terms of the trends going forward, we will require more technology, especially in geographic information systems,” she says. “Another trend is densification. We must integrate our communities better to achieve the spatial transformation that is greatly needed in South Africa. Densification will not only achieve optimal infrastructure but will also assist in the development of public transport.” Looking at SAPI’s future endeavours, the organisation wishes to build a strong relationship with SAPOA. “We recently signed a MOU with SAPOA, a decision that derived from both organisations boasting similar interests in the property industry,” says Van der Bank. “We need to assist and support each other. There are points of synergy between the two organisations.” She also says that SAPI will soon sign an MOU with the Department of Human Settlements. “Currently there’s an agreement between SAPI and the Department. Minister of Human Settlements Lindiwe Sisulu has committed to developing 1,5-million houses by 2020. SAPI is supporting this,” she says. Planning doesn’t happen in isolation, says Van der Bank. “We have to take into account our community, available services, infrastructure capacity and the various stakeholders. We want to ensure a bigger and better future for our communities.”

CLOCKWISE FROM TOP LEFT Cornelia van der Bank, Chief Executive Officer of SAPI; Neil Gopal, Chief Executive Officer of SAPOA; Amelia Beattie, SAPOA President; Nthato Minyuku-Gobodo, SAPI President

“We want to work towards job preservation. Planning services are of a high standard and we need to ensure that this standard is maintained. We are working with SACPLAN to get to a certain level of job preservation” February 2015 l property developer

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development

South retail sensation A first for the south of Johannesburg, the highly anticipated Mall of the South is set not only to bring exceptional retail to the area but also spur on future development By Candace King

e caught up with Zenprop Property Holdings (Pty) Ltd spokesperson Waldo Marcus to get more detail on the Mall of the South, the next big regional shopping centre currently being developed that will provide a mega-retail experience for consumers based in the south of Johannesburg and act as a catalyst for further property development.

of Swartkoppies Road and Klipriver Drive in the affluent suburb of Aspin Hills. As the market was investigated and researched, it became evident that the area has a huge retail appetite and the current existing retail offering is very limited for an area that is growing very fast. In consultation with the major national and dominant retailers, the need for an up-market development became more apparent.

Q When and how was

Q Why the name â&#x20AC;&#x153;Mall of the Southâ&#x20AC;??

the project initiated?

The area was identified by Zenprop in 2009 as a potential area for the development of a retail scheme. Various sites were identified, including the current property on the corner

We believe the name should reflect and stand for the area and community in which it is operating. It was very important for us to ensure the community takes ownership of the development. The name is strong and ties in with the geographical location and the

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development

market it is going to serve. Mall of the South is made in the south, and focused on the needs and wants of the market.

Q Why was the south chosen as well as the

particular area for this development?

There are several factors considered before a development of this scale and cost is started, but the numbers showed us there is massive potential, which will continue to grow. The estimated spend for the market is R6-billion and, should we apply a very conservative 27% market share, the estimated retail spend will be R1,6-billion per annum. Thirty-five percent of the market is AB income and 55% is CD income groups, highlighting the spend potential in the catchment area. We also considered future

Mall of the South in short • Regional mall • Launch size: 65 000m² • Possible expansion: up to 90 000m² • Total investment: R1,8-billion • More than 3 000 parking bays at launch size • Opening date: 24 September 2015 • 154 stores planned February 2015 l property developer

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development

n Property South Africa

Review

development in the area, so the site that was selected is perfect to serve the growing market well into the future. The selection of the site was based on future growth and access to the mall. Visibility was critical, and infrastructure development and expansion was also considered. The combination of the market potential, the site location and the need for an up-market and well-appointed mall were the main drivers behind the development.

Q What makes this development unique and how will it impact the surrounding areas? The southern suburbs of Johannesburg did not enjoy large-scale

Several commercial and retail development focus in the past. We believe is going to change as the location and growth potential has up-market and this now been realised. Several up-market and large-scale residential large-scale developments have gone up in the past 10 years; more are being and planned. A retail development such as the Mall of residential developed the South is a driver for future residential and commercial developments developments in an area. A suitable case study is what Gateway for Umhlanga and its surroundings. It was a major catalyst for have gone did property development and large residential property gains in the up in the past surrounding areas. 10 years, and Q What due diligence was more are being done for this development? the site was identified, we worked very closely with the developed and After residential property owners, developers and the council to planned determine the best way forward. All required studies were

About the developer Zenprop Property Holdings (Pty) Ltd is one of the largest property investment and development companies in South Africa. Founded in 1998, it has a record for excellence, and has earned the reputation of â&#x20AC;&#x153;best-of-breedâ&#x20AC;? developer from industry peers. Its property portfolio comprises a formidable mix of prime core investments, including retail, offices, industrial and warehousing, and hospitality.

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Prop

development

Getting your brand noticed by South Africa’s leading property industry decision-makers May 2014

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Online and in hand, these monthly publications are the official voice of the South African Property Owners Association

November 2014

With a South African property market value in excess of R250-billion, SAPOA members control in the region of 90% of South Africa’s private sector commercial land and building stock, and manage the majority of property funds listed on the JSE. Each member is a leading player and decision-maker in the commercial property arena – and they use the South African Property Review as an extension of the SAPOA website and information platforms. These members – company chairmen, CEOs and MDs – often control massive companies and their associated budgets. As true decision-makers, some of the brightest and most talented people in the sector occupy senior roles in the SAPOA member organisations. The South African Property Review is mailed directly to the association’s leading members, and is also available to the general public both internally and online via Issuu - the online version is an exact copy of its printed original and has on average over 3300 impressions a month, giving a monthly reader exposure of over 5000. To date our online July and August 2014 issue hit rates have reached 7605 and 7139 impressions respectively, with over 400 solid reads of an average of nine minutes, and growing.... The true value of the online versions is that they get revisited over and over again and generate a liquid international exposure for your company, making the South African Property Review a ‘must include’ in your marketing plans.

Cover

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REVIEW

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With a monthly average exposure of more than 5000 readers, the South African Property Review is a growing and recognised news platform and go-to source of important industry information, interviews as well as in-depth African and regional reports.

For advertising opportunities and rates contact Riëtte Stevens t: +27 (0)71 877 5520 e: sales@sapoa.org.za February 2015 l property developer

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development undertaken and performed in consultation with the community. As I have mentioned, the mall is meant for the community and to become a catalyst for future development, so we had to ensure compliance and continue to do so. The mall and all infrastructure, the environment, parking flow, traffic and the surrounding areas and aesthetics have all been taken into consideration.

and congestion been taken into account? A full study was done on the traffic flow prior to finalising the design of the development, and also on the parking flow on the property. We are very aware of this – one of the sensitive touch points for a successful retail development is ease of access to and from the mall, so we have spent a lot of time and effort to ensure ease of access from all the roads to avoid traffic congestion. We expect traffic to increase in the area but provision was made for this. Most of the traffic flow is handled on the site, which will have minimal impact on the main arterial roads.

Q Which parties are involved in this development?

Q With the influx of shoppers, has traffic

construction and development team – but we are on track to open on 24 September 2015. Strikes and an increase in construction costs remain a challenge, as does electricity supply. We have taken these into consideration prior to construction and planned for these scenarios.

Vivid Architects is the main firm being used for the mall design, and Aveng Grinaker-LTA is the main construction contractor. Leasing is done by Zenprop Property Services.

Mall of the Q Once completed, will there South was be any future development plans? designed to be Mall of the South was designed to be expanded from its launch size of 65 000m² to 90 000m² as demand grows. The expanded from expansion footprint was taken into consideration when all its launch size services and infrastructure were designed. This will ensure Mall of the South will dominate its catchment area of 65 000m2 decades to come, and ensure the expansion is Q Have there been any challenges so far? 2 to 90 000m as Remaining flexible for the retailers’ needs and an increase in for seamlessly integrated into the current flow and structure of demand grows demand for more space has resulted in very tight deadlines for the the development.

rda Valley, West, Wie rda Road 6 Park, 36 Wie End Office 78544, Sandton 214 0684 w, Hunt’s PO Box (0)11 883 Paddock Vie 9 f: +27 1 883 067 a.org.za t: +27 (0)1 www.sapo

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o. 1 and 2 Silo are the first comple ted phase in the Silo Precinct of the V&A Waterfr ont, which will soon see the redevelopmen t of the historical Grain Silo. No. 1 Silo is an 18 500m² develo pment overlooking Square and the Silo Atlantic Ocean. The building was and built to be the designed new headquarters of blue-chip tenant Gray, who was Allan looking to consoli date its offices V&A into a single within the development that would reflect its values and encour company age greater commu nication betwee staff members. n its The building has been awarded the region’s first 6-star Green Star rating for Design from the GBCSA, and As Built rating is an being sought. Incorpo rating innovative design solutions green with proven techno logy, No. 1 Silo with the environ works ment rather than against it. Key sustainability features include the high-performan ce,

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feature

The residential revival Just when you thought that the residential industry was doomed, the sentiment for the sector is looking up as interest in the housing market rises By Candace King

ABOVE Dr Andrew Golding, Chief Executive Officer of the Pam Golding Property Group BELOW Charles Robertson, Chief Executive Officer of Visual International Holdings (Photograph by Mark Pettipher)

or some time, the South African residential market experienced a lull. But looking at the latest activity in the sector, a new-found interest in residential appears to have blossomed during the course of 2014. Despite the deterioration in South Africa’s economic-growth prospects, the outlook for the country’s residential market may actually be gradually improving, says Dr Andrew Golding, Chief Executive Officer of the Pam Golding Property Group, noting that, encouragingly, there is little evidence of a residential housing bubble. “South Africa’s growth prospects deteriorated steadily throughout 2014, prompting analysts to slash growth estimates to just 1,4% for the year as a whole,” he says. “The disappointing local performance reflects, in part, the impact of the uncertain global environment. Much of 2014’s disappointing growth is attributable to local developments, including rising prices, labour tensions, load shedding, transport constraints, interest rate hikes and general policy uncertainty. However, the local economy is expected to improve moderately over the next few years, supported by the continued modest recovery in global growth, rising exports to the vibrant economies of our African neighbours and the easing of transport and logistics constraints as infrastructure projects are completed.” Golding says that, with expectations of a modest strengthening in economic growth, an easing in the inflation rate, a very gradual series of interest rate hikes and ongoing positive sentiment, the outlook for South Africa’s residential property market is positive. “The year 2014 was the year when house price growth began to move into above-inflation, positive territory for the first time since the 2008 recession ended,” he says. “As the October 2014 Pam Golding Residential Property Index reflects, the national trend line of property value growth showed no sign of faltering through October 2014 and had, in fact, strengthened since the previous month as it powered its way towards the eight percent nominal house price benchmark, indicating further progress ahead.” The sustained upswing in the South African residential property market is creating stability and optimism in an environment of investment uncertainty in the economy, related to the volatility of the rand against world currencies and fluctuations in the stock market. “It’s not unusual for property to take over as a primary area of investment when other options appear unpredictable,” says Golding. “Residential property offers strong incentives for investors, with capital growth being the primary attraction and a reliable rental return another.”

What’s trending at home? In light of this positive performance and outlook, the industry over the past year has seen a number of emerging trends. Apart from a slight improvement in mortgage lending, we are experiencing high rental demand and a rise of the black middle class buyer. “While still stringent, bank lending criteria have eased to some extent,” says Golding. “Statistics released by Ooba, based on trading for the third quarter of 2014, showed that Ooba’s home loan approval rate in Q3 2014 remained high at 72,2%, indicating approval for approximately seven out of 10 home loan applications.” The earning power of the black middle class, estimated at about 4,2-million, has had (and will continue to have) a major impact on demand and growth in the residential property market, helping underpin its sustainability. “We continue to note strong letting markets, with a general shortage of stock as a consequence of pentup demand,” says Golding. There’s also been an increase in appetite for the residential rental market among commercial property players. While retail assets have been attractive, JSElisted property funds are finding opportunities in housing. Although one percent of the listed property portfolio in the country comprises residential, this is believed to increase. Wholly owned subsidiary of JSE-listed Arrowhead Properties, Arrowhead Residential Limited, recently announced an acquisition of several residential properties for a purchase consideration of just over R1-billion. A major trend that the sector has experienced is a continued re-emergence of developments. In August 2014, JSE-listed Freedom Property Fund launched two major residential property developments, while JSElisted Visual International Holdings is on track to invest R33-million in residential property development projects over the next two years. Visual International Holdings is a property development, holdings and services company that develops complete, self-contained suburbs for the middle-income market – the fastest-growing property segment in South Africa, which is experiencing more than 10% per annum growth. The company owns more than 70 000m² of developable bulk at its award-winning flagship Stellendale Village development in the northern suburbs of Cape Town. Stellendale Village is a 22hectare mixed-use residential suburb just off Stellenbosch Arterial in Kuils River, Cape Town. It will ultimately provide about 1 500 homes to middleincome households when completed, including an integrated retirement estate.

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Using Stellendale Village as a model, the company is in discussions to develop a new 83-hectare residential suburb in Klerksdorp in the North West, called Reebokfontein Village, which will provide about 2 000 much-needed houses, apartments and lifestyle suites for the middle income group. “Visual has a long-term vision and we pride ourselves on delivering quality properties that also offer good living and pleasant shopping, working and recreation,” says Charles Robertson, Chief Executive Officer of Visual International Holdings. “Our properties are developed around people and community. We are excited about creating a new suburb in Klerksdorp that will offer residents affordable, good-quality living. “While creating quality housing that meets a substantial market demand, Visual also strives to provide its stakeholders with a positive and sustainable investment experience. We’ve telegraphed our plans to take our tried-and-tested model into new regions, and Reebokfontein Village provides a good fit in an area with a growing middle market driving demand for housing.” Gated community-based residential estates are also popular developments lately. A prime example is Graanendal Estate, which boasts remarkable views, large, open spaces and relaxed, rural-style living in a secure environment. Voted South Africa’s top lifestyle living location in a 2012 survey of the country’s best suburbs, Graanendal Estate recently announced the launch of a second phase. This follows the enormous success of Graanendal phase one, which recorded a 16,7%

growth in house prices over one year – substantially higher than the 1,3% average growth for the year recorded by ABSA. Situated in Cape Town’s value-for-money northern suburbs on the outskirts of Durbanville, adjacent to the Phizante Kraal wine estate, phase two is offering seven pockets of group housing developments as well as 97 individual erven. It will also feature the same green belts and parks found in phase one. Land-owner and developer of Graanendal Estate and owner of the quaint Phizante Kraal wine estate, Andre Brink, says Graanendal phase two was developed in line with the continuing demand for affordable gated community homes that the market is currently experiencing. Brink, who farms next door, says being a neighbour means honouring a long-term commitment as a developer and member of the Home Owner’s Association. “The location is a natural choice for those preferring the northern suburbs,” Brink says. “It links Durbanville with the N1 through Okavango and Brackenfell Boulevards for quick access to town and Paarl, and is situated on the outside of the traditional traffic belts, yet conveniently close to local amenities.” These include a shopping centre, Durbanville Medi-Clinic, banking facilities and a host of primary and high schools within a seven-kilometre radius. Brink says Graanendal phase two is the last serviced gated development in the Western Cape, following a policy decision by the City of Cape Town not to allow any further such developments.

ABOVE Visual International Holdings’ mixed-use suburb development Stellendale Village in Cape Town. A new development modelled on the successful Stellendale Village is being planned in Klerksdorp BELOW Andre Brink, farmer, land-owner and developer of Graanendal Estate (Photograph by Mark Pettipher)

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Situated on the outskirts of Durbanville, Graanendal Estate phase two is currently being developed. It is the last serviced gated development in the Western Cape

“This means any future gated developments will have to contract privately to service the developments, which adds a considerable burden to levies compared to other such estates,” he explains. “As such, Graanendal can be priced favourably. This, in an area that has already proved its worth in terms of healthy growth, can only mean excellent growth in property values. “The farm plays an important role in the development as it serves as an attraction. The development of Okavango Road will alleviate traffic pressure, which will also play a positive role in this development from an access point of view.” “With a massive increase in sectional title homes built (15% of total annual building during 20102013), these properties are in high demand for a number of reasons, including the desire to live within a secure estate or complex, the convenience of not having to manage a larger property, and investors seeking to capitalise on a strong rental demand and strong signs of renewed capital growth,” says Golding. “A central location offering easy access, good security and a convenient lock-up-and-go lifestyle is integral to the success of these developments. Coupled with this trend is a continuance of the popularity of the live, work, play concept in prime nodes within easy reach of transport routes and the workplace.” “Currently there is a desperate need for the development of local government schools,” says Brink. “I am negotiating with local government for two school sites to be developed. We have to accommodate local government school development.” Robertson notes that the middle class wants to live close to job opportunities because every rand counts. “It’s important for us to find these nodes and develop within them,” he says. “Public transport is also very important. Nasrec in the south of Johannesburg is the next node to watch in Gauteng for new suburb development.”

Housing the future Looking ahead, says Golding, and bearing in mind the potential for unexpected shocks both on the global stage and in South Africa, it is likely that the prevailing market conditions will continue for the first six months of 2015, with high levels of buyer activity, significant shortages of appropriately priced stock and gradually increasing house price growth, against the backdrop of weak economic performance and a moderately increasing interest rate cycle. “We may even see accelerated house price appreciation off the back of increased stock shortages and increased buyer confidence,” he says. “In addition, given affordability issues – which are a global phenomenon for aspiring home-owners (in particular first-time home-buyers) – we anticipate continued improvement in the buy-to-let market and the strength of the letting market in general.” “The rental market is massive in South Africa,” says Robertson. “Ten years ago, half of the middle class were able to buy, and the rest were tenants. Today, it’s difficult to get 10% buying from this segment – mostly investors buy.” Golding notes that the leisure market is already experiencing renewed interest, and that we could be seeing the long-awaited genuine re-emergence of the second home and leisure market in the coming year. “With regards to the high end of the market, as the global economic recovery becomes more established, we anticipate seeing high-net-worth individuals or the über-wealthy investors shifting their focus from the preservation of capital (cash, gold and fixed interest) to capital growth (equities, real estate and business interests),” says Golding. Key trends that will emerge in the future include the development of (and investment in) affordable housing as well as student accommodation. With South Africa’s 2,3-million housing backlog and the

lack of supply in the student accommodation segment, there is great opportunity for property players. In light of this, it is highly likely that we will see the inception of a focused residential fund to be established over the next 12 to 24 months, as well as a new fund dedicated to providing student accommodation in the future. Visual International Holdings’ future prospects, says Robertson, include looking into entering the affordable housing space as well as getting involved in city regeneration projects. “We are looking to partner and we are also looking into home-loan packages,” he says. “We predict substantial increases in residential property prices in the next few years. While second-hand houses are being taken up and the segment reaches its limit, building new houses will become a real financial opportunity going forward.” “Developing today is very challenging, so developers need to be cautious in what they develop,” says Brink. “Furthermore, most development today destroys a sense of community. Graanendal is about open spaces and interacting with the community.” On the other side of spectrum, Brink believes that communities should also take charge of looking after the places they call home, especially the surrounding public spaces, which – if ill-maintained – can have a major impact on property values. This is the very reason why Brink is developing high-quality sought-after residential estates around his farm. “It’s about maintaining the area around me as a neighbour, making sure that my property’s value stays high,” he says. “When we develop, we are in it for the long term, and we want to make sure that the longevity of developments is intact and maintained well into the future,” says Robertson. “We need to plan for the social fibre of the world that we are creating.”

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investment and business roadshow

Durban set to become a major business hub The Durban Chamber of Commerce and Industry, in collaboration with eThekwini Municipality and Trade & Investment KwaZulu-Natal, hosted an Investment and Business Roadshow in Durban on 17 and 18 September

nvestors and property professionals were treated to highly informative presentations by various project owners invited to present their investment projects to the delegation. After opening comments from Andrew Layman, Chief Executive Officer of the Durban Chamber of Commerce and Industry, the programme commenced with presentations by Trade & Investment KwaZulu-Natal (Kanyi Ntoko-Gasa, Executive Manager: Investment Promotion) and Durban Investment Promotion, eThekwini Municipality (Russell Curtis, HOD), who outlined and reinforced KZN investment intent, vision and values, which aim to attract the national and international investor community to the province. This was followed by an update on the Durban Dig Out Port project by Irvindra Naidoo (General Manager: Group Strategy at Transnet). The presentation outlined the critical need for this catalytic project to proceed in context of the logistics growth anticipated over the next 20 to 30 years, with slides showing the proposed port layouts and statistical projections to support the need for the development. Delegates were then transported to Dube City, where Tim Hudson (Project Manager at Dube Tradeport) presented the various leasehold investment opportunities currently on offer as well as an expansive pipeline of projects coming on stream shortly. This was followed by a trip to the impressive Cornubia Industrial Business Estate, a Tongaat Hulett Developments (THD) development under

construction, with more than 90% of phase one already sold. Greg Veerasamy (Development Executive at Tongaat Hulett), outlined the overall project status, a joint venture between THD and the eThekwini Municipality, with the first phase of the lowcost housing component also being visited. Tongaat Hulett head office was the next destination, where further presentations were given regarding the aerotropolis development plans of the JSE-listed company, which include the Bridge City mixed-use node, the soon-to-be-launched Sibaya Residential Estate and the Ushukela Highway Industrial Estate adjacent to the King Shaka Airport. The highly informative day was concluded with a dinner and a civic reception by the

eThekwini Municipality, held at the Cargohold in the Ushaka Marine World. Day two of the roadshow commenced at the Elangeni Hotel presentation room, with a presentation from Pat Conway (Project Manager at KDC Projects and Developments), who presented his Kings Estate mixed-use industrial, commercial and residential development, also located within the aerotropolis node on the North Coast. This was followed by a slick and dynamic presentation by Dr Sharron McPherson on behalf of the Finningley Joint Venture Development Company. The Finningley Growth Sphere is located on the Durban South Coast and already has investment support from the US in its quest to offer a substantive, unique and

Cornubia Industrial Estate site visit

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investment and business roadshow

province’s investment promotion calendar. With the necessary support and promotion, future planned events promise even more exciting projects and activities as part of the programme for our local/national and international investors to enjoy and participate in. Readers wanting more information are welcome to visit Kwazuluinvestor.co.za in order to view these and other investment opportunities on offer. Alternatively, please contact James Arnott for more details: t: +27 (0)83 625 8078 e: james@arnottconsulting.co.za Investment opportunities include projects in all quarters of Durban

Farah Goolam, Russell Curtis and Greg Veerasamy

innovative sustainable development model to the province. The Clairwood Racecourse redevelopment project then followed, presented by TC Chetty from Capital Projects. The development will offer a much-needed back-of-port logistics space in anticipation of a surge in demand with the Transnet port expansion plans, and will come online as soon as the various approvals have been obtained. LIV Village showed a short video clip on its ground-breaking community initiative based in Tongaat on the North Coast. Its investment needs were strongly endorsed by both Curtis and Layman as a great CSI opportunity for local and international businesses, grants and funds. The final leg of the roadshow involved getting back on the bus and heading to the KwaMnyandu Town Centre Development in Umlazi, where project manager Vuyo Jayiya gave a presentation on the commercial investment opportunities that will be coming online following the successful development of the KwaMnyandu retail mall. The development has been heralded as a groundbreaking initiative with regards to previously disadvantaged township redevelopment in the region.

A tasty shisa nyama (a barbecue/braai) lunch was then held at local restaurant Max’s. With full stomachs, delegates headed to the Mpumalanga Town Centre Development in the N3 corridor, heralded as KwaZulu-Natal’s future version of Gauteng’s powerful Midrand corridor. Peter Gilmore (Project Manager at eThekwini Municipality) gave a breakdown of the industrial and commercial investment opportunities available in the node, following the successful development of the Mpumalanga retail shopping mall. To end a highly informative day, a tired and satisfied group of delegates was treated to sundowners and snacks at the Pot and Kettle in Hillcrest (on the world-renowned Comrades Marathon route), before heading back to the hotel. The Durban Investment and Business Roadshow provided two days of wellorganised site visits and entertainment, along with some exceptional presentations. The message that KwaZulu-Natal – and Durban in particular – is an investment destination that stands out head and shoulders above most other developing areas around the globe was put across in no uncertain terms. The event – the first of its kind – needs to become a permanent fixture on the

In the north Dube Trade Zone Dube City Kings Estate Bridge City LIV Village Training Centre Sibaya Phases 1 and 5 Ushukela Highway In the south Finningley Estate Clairwood Racecourse KwaMnyandu Shopping Precinct South Illovo Precinct In the west Mpumalanga Town Centre Cato Ridge Hub Details of these projects are available at Kwazuluinvestor.co.za. They address: • • • • • •

City development Residential development Commercial and retail land use Infrastructural development Industrial development Logistics

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feature

Making its mark Having already established itself as the go-to company for rural and small-town shopping centre development, Landmark Real Estate Services (Pty) Ltd continues to make its mark in the specialised segment By Candace King

Lionel Kisten, Executive Director Landmark Real Estate Services (Pty) Ltd

he development of shopping centres in rural South Africa has evolved into somewhat of a fad. The need to uplift such areas and to meet the demand that exists among the previously disadvantaged has come to the fore. But it takes a special kind of developer to enter this territory – one with knowledge of the market, the required experience, and the passion and dedication to community upliftment. One such developer is Landmark Real Estate Services (Pty) Ltd, a BEE property development company that specialises in developing shopping centres across South Africa in previously disadvantaged and rural areas as well as small towns. Among its recent successes are Makhado Crossing in Louis Trichardt, Bara Mall in Soweto, Naledi Mall in Vosloorus, Shoprite Centre in Thokoza, Metropolitan Centre in Ennerdale and (most recently) Tower Mall in Jouberton, Klerksdorp. Having opened on 25 October 2013 in the growing Jouberton, City of Matlosana, Tower Mall has been a success since its inception and official opening. Owned by JSE-listed property company Dipula Income Fund and developed by Landmark Real Estate Services (Pty) Ltd, Tower Mall has brought 15 400m² of quality retail to this community and to consumers in the surrounding western suburbs of Klerksdorp. Not only has it served as a retail asset but it is also an economic driver to the community. It’s regarded as the largest-ever private investment into this community, with a tenant mix especially selected to meet local shoppers’ needs. The mall caters to a growing population of about 250 000 people from Jouberton, Alabama, Manzil Park and Kenana.

Continuing to service rural areas, Landmark Real Estate Services (Pty) Ltd has embarked on its next and latest retail development, this time in the KwaThema district on the East Rand, styled Junction@ Kwathema. Landmark Real Estate Services (Pty) Ltd recently announced the development, which will bring great retail Bridging the gap relief to this particular area Continuing to service rural areas, Landmark

Real Estate Services (Pty) Ltd has embarked on its next and latest retail development, this time in the KwaThema district on the East Rand in Gauteng, styled as Junction@ Kwathema. Landmark Real Estate Services (Pty) Ltd recently announced the development, which will bring great retail relief to this particular area.

Located in the township of KwaThema, southwest of Springs on the East Rand, and prominently situated at the entrance to KwaThema on its main feeder route, Tonk Meter Drive, the retail development is expected to service a large portion of the KwaThema district and its neighbouring areas. Junction@Kwathema falls within the Ekurhuleni Metro Spatial Development Framework as a new, major growth node. The highly visible location at the junction of Tonk Meter Drive and Rhokana Street has attracted much interest from prospective tenants and the community as a whole. It is conveniently situated within walking distance of the KwaThema township and the taxi rank positioned nearby, and is highly accessible to the residents of Selcourt, Sharon Park, Dunottar and Langaville neighbourhoods. “The mall will satisfy a critical retail need in the region for shopping facilities for the currently under-served and growing population who have very limited retail facilities at their disposal,” says Lionel Kisten, Executive Director of Landmark Real Estate Services (Pty) Ltd. Designed by Richard Venter of architectural firm VH+S, Junction@ Kwathema is positioned as a modern, aspirant shopping centre, in line with previous Landmark Real Estate Services (Pty) Ltd developments. Targeting a broad-spectrum LSM of 2 to 7, this vibrant development is intended to appeal to a wide range of shoppers with a variety of tastes. According to Venter, the fresh aesthetic of the centre will provide consumers with the look and feel of an attractive, upscale mall, the likes of which are usually located in urban, metropolitan areas. “After initially planning to develop a 10 000m² community mall, Landmark has been inundated with demand from both community stakeholders and prospective tenants,” says Venter. The nine-hectare site will be developed in two phases, with the first 16 000m² to commence in the first quarter of 2015 and scheduled for opening in September 2016.

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DON’T MISS OUT on this well-used and popular industry resource, where each year we accept a large number of listings and advertisements from professionals and service providers across the entire spectrum of property activities. SAPOA aims to provide added value by offering the basic listings free of charge to all members, and in this respect, we hope that we are assisting you in your marketing endeavours to some extent. We thank you for your support in previous years, and in an effort to improve the look and ease of usage, we have redesigned the directory layout to a four column grid and made available certain entries which will stand out from the norm. Architects

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For advertising opportunities and rates contact Riëtte Stevens SOUTH AFRICAN PROPERTY REVIEW 20 February May 2014 2015 l property l property developer developer c: +27 (0)71 877 5520 t: +27 (0)11 883 0679 f: +27 (0)86 216 9026 e: sales@sapoa.org.za Landmark_SUBBED.indd 37 Register ad.indd 20

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feature “We are very happy with the existing bulk infrastructure servicing the site and its surrounds. Unlike so many sites we are offered, sewerage, storm-water and sanitation connections have already been established at the boundary of the site, and this bodes well for the swift commencement of the initial phase during the first quarter of 2015”

To be developed in two phases, Junction@Kwathema is set to reach 30 000m², catering an under-served and growing population in the KwaThema district on the East Rand in Gauteng

The intention is to develop up to 30 000m² thereafter to ultimately provide a full-service regional mall offering. The project’s primary trade/catchment areas are the KwaThema and Selcourt districts, located in the greater Springs area. With an existing population of 180 000, the area is forecast to grow substantially in the short to medium term as new middleincome housing projects are completed and additional developments get under way.

Working together

Landmark Real Estate Services (Pty) Ltd ensures sustainable job creation through its developments and embraces community participation. In line with this ethos, Junction@Kwathema will serve the residents of Selcourt Estate, a neighbouring affordable housing development. The Housing Impact Fund South Africa (HIFSA), managed by Old Mutual Investment Group, owns the land and is the developer of Selcourt Estate, a 1 200-unit gated estate relaunched on 18 October 2014. HIFSA focuses on making a large-scale positive social and developmental impact, primarily through affordable residential developments. “According to Old Mutual, Landmark’s successful track record of township-based community retail developments, including the recently opened Tower Mall in Jouberton, make Landmark the ideal partner to roll out the retail component of the development,” explains Kisten.

Old Mutual, through HIFSA, and Standard Bank are just two of the financial institutions committed to continuing their affordable housing initiative for the area, financing the development of an estimated additional 8 000 units adjacent to or within close proximity of the centre.

Breaking grounds

Kisten notes that the site is ready for immediate development, citing the added advantage of electricity having already been allocated to the site. “We are very happy with the existing bulk infrastructure servicing the site and its surrounds,” he says. “Unlike so many sites we are offered, sewerage, storm-water and sanitation connections have already been established at the boundary of the site, and this bodes well for the swift commencement of the initial phase during the first quarter of 2015.” While the bulk infrastructure is taking shape, the developers are currently in discussion with various supermarket chains, fashion retailers, banks, fast-food retailers and building merchants to take up tenancy upon completion of the development. As a dynamic development, Junction@ Kwathema offers unprecedented possibilities, providing further economic growth opportunities, says Kisten. The R200-million first phase will provide the impetus for further commercial development and economic growth in the region.

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INNOVATIVE

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last word

Developing with heart Dealing with the fragmented spatial legacy of the past and catering for the urbanites of the future, the need to develop meaningful integrated and sustainable cities is now a present task By Candace King

hink of a city that lacks nothing – a city that consists of communities located in walkable, prosperous, safe neighbourhoods; a city with self-sufficient communities characterised by mixed incomes and varying socio-cultural origins; a unified community with deep social and cultural roots, where the citizens are truly free to live a life of meaning and purpose. Some may think it’s far-fetched but this is the vision of Cape Town-born property developer David Pearson, who seven years ago decided to act on his vision of creating such a city. Based on his constant entrepreneurial search for business opportunities, this dream speaks to the plethora of spatial and social issues that South Africa faces. One major problem is the growing backlog of housing. The overall South African housing backlog currently sits at 2,3-million housing units – and for Cape Town, the figure is approximately 400 000 units. With apartheid’s spatial legacy still plaguing the country via social and spatial fragmentation, the emerging challenge is to move past the development of housing in the tradition of the dormitory-styled apartheid townships, and to ensure that newly created neighbourhoods serve as attractors for investment and trade, act as places of recreation and pleasure, and allow for the exercise of socio-cultural tradition. Above all, these new neighbourhoods are places of meaning that the inhabitants can call home – an African urban place of meaning and belonging. The use of “African” here signifies that this issue is a continental one. The African continent is experiencing rapid urbanisation and population growth of great proportions. The need to create new urban living spaces is more crucial than ever. It is projected that Africa will be home to two-billion people by 2050.

It is also estimated that 400 new cities, consisting of a million-plus people each, will be needed to accommodate everybody on the continent in the next 40 years. Added to this, Africa’s middle class is swelling and driving growth. According to a report by Standard Bank Group Ltd, middleclass households in 11 leading economies in the African region are set expand to about 40-million by 2030, with the biggest growth seen in Nigeria, the continent’s largest economy. Returning to Pearson’s vision, which is unpacked in specialist property and community development company communiTgrow’s 2 Billion Strong: A Regenerative Solution To Building Sustainable African Cities book, such community building is based on a six-pillar approach: economy, housing, healthcare, education, regenerative ecology and governance. As founder and Executive Director of communiTgrow, Pearson highlights that the company offers a regenerative solution to building sustainable cities in Africa, and relies on a network of organisations, individuals and companies who are experts in urban development and who share communiTgrow’s ethos that well-managed

urban development can drive economic and social growth in Africa. Based on the six-pillar model approach, communiTgrow is involved in a live pilot project called Wescape, currently under way on the urban edge of Cape Town. Located on the Atlantic coast of the Western Cape along a development corridor that extends upwards into West Africa along the N7 national highway, Wescape will assist in providing solutions to many of the metropole’s economic expansion requirements and 20-year plan for education, housing and healthcare. Valued at R150-billion, the integrated, holistic and green development will consist of 3 100 hectares and will provide 200 000 homes; 300 000 jobs; 400 educational facilities; 90 health, safety and community facilities; 600 public open spaces and 1,7-million square metres of lettable commercial space. It will be home to 800 000 residents, and will connect to the City of Cape Town’s integrated rapid transport system and eventually rail, which is currently in the planning stage. Still think it’s far-fetched? The vision is now a reality.

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