South African Property Review April 2015 by SAPOA

South African Property Review

PROPERTY SOUTH AFRICAN

April 2015

REVIEW

Broll Property Group Remaining passionate about property Transforming Tshwane SA’s capital set to soar Professionals

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The V&A Waterfront The Cape’s premier lifestyle destination

AFRICA SERIES The lowdown on the DRC

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April 2015

Cry for me, Argentina

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contents

April 2015

PROPERTY SOUTH AFRICAN

Abland

REVIEW

South African Property Review

PROPERTY SOUTH AFRICAN

April 2015

REVIEW

Broll Property Group Remaining passionate about property Transforming Tshwane SA’s capital set to soar Professionals

series

s●

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monthly cou n Our

The WOR

The V&A Waterfront The Cape’s premier lifestyle destination

ON THE COVER Celebrating 40 years of property excellence, Broll Property Group remains passionate about property and continues to provide its clients with the best service

Abreal

AFRICA SERIES The lowdown on the DRC

by-country focu try-

April 2015

Cry for me, Argentina

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From the CEO From the Editor’s desk Industry news Education, training and development Furthering education Legal update The MPRA in review Planning and development Proactive planning Theme leader Rebuilding the Republic Africa uncovered Democratic Republic of the Congo Eye on the world Cry for me, Argentina Cover feature Broll: Forty years of property excellence Feature Transforming Tshwane Feature Changing the way we live Feature Investing in a lifestyle SAPOA events Under construction Flashback The Cosmopolitan Hotel Feature The return of CBD retail Proﬁles Statistics What’s on Upcoming events Off the wall Mars’s new Martians

Oilgro

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 Manager Dalene van Niekerk Designers Wade Hunkin, Dirk Knoesen Sales Riëtte Stevens Finance Susan du Toit Contributors Andrew Barker, Andrew Fleming, Eugenia Makgabo, Lekgolo Mayatula, Nicky Manson, Martin Ferguson, Michelle Marais Photographers Erik Forster, Candace King, Carola Koblit, Ed Suter Mark Pettipher, Michael Glenister, Scott Arendse 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.

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

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e: david@rsalitho.co.za

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from the CEO

A call for energy efﬁciency SAPOA CEO Neil Gopal highlights the importance of energy consumption and the need to partner with government to combat the current energy crisis

Cutting down on electricity costs will help alleviate the energy crisis at hand – in comparison to a standard building, the average green office building saves 34% in electricity consumption. Commercial property buildings stand a chance of benefiting in terms of their commercial value if certain green measures are taken, including investing in off-grid or co-generation methods.

n the face of the current energy crisis, SAPOA is calling on commercial property owners to become more energy-efficient. At the same time, commercial property businesses should find ways to collaborate with government to alleviate electricity and power supply constraints. “Within the next three months, South Africa will see Medupi unit six’s full potential of 794MW being fed into the South African national grid,” said Eskom Chief Executive Officer Tshediso Matona. However, Medupi’s total output of 4 764MW is only expected to be synchronised to the grid by 2019. According to SAPOA affiliate, the Green Building Council of South Africa (GBCSA), the time has come for greater energy efficiency to be adopted and practised by businesses. This call has been brought to the fore in light of further electricity price hikes, which were highlighted in the 2015 Budget. Furthermore, it was announced that to stabilise its financial position, Eskom will apply to NERSA for adjustments towards cost-reflective tariffs. The proposed increase in the electricity levy does not bode well for commercial property businesses going into the near future. However, the GBCSA believes that this can be seen as an opportunity for greater greener practices and a stronger case on energy efficiency.

Cutting down on electricity costs will help alleviate the energy crisis at hand – in comparison to a standard building, the average green ofﬁce building saves 34% in electricity consumption. Commercial property buildings stand a chance of beneﬁting in terms of their commercial value if certain green measures are taken, including investing in off-grid or co-generation methods SAPOA also feels positive about the various tax measures that were announced in the Budget. These include the increase in the energy-efficiency savings incentive; consideration for accelerated depreciation for photovoltaic solar renewable energy and the extension of incentives to co-generation projects. The proposal to double the current energy-efficiency savings incentive from 45c/kWh to 95c/kWh will surely stimulate the industry to move towards greener measures. However, says SAPOA Sustainability Committee Chairman Werner van Antwerpen,

SAPOA highlights that it is aware that REIT companies cannot claim the current tax incentive. In light of this, the SAPOA Sustainability Committee in association with SANEDI is investigating ways to change the incentive to accommodate REITs. Furthermore, SAPOA applauds business in its efforts to work with government to find solutions to the current electricity supply constraints. Eskom needs space (3 000MW lower demand) to allow it to try to catch up on the maintenance backlog. The maintenance backlog has resulted in a situation where there is currently 11 000MW of unplanned outages, which puts the system under severe pressure. Although we are clear that the economic cost of load shedding is higher than any other demand or supply side intervention, government wishes to confirm this through modelling. It is important that government understands the significant impact of the current situation (in particular load shedding) on the productive sectors of the economy, so we urge you to work with government and Business Unity of South Africa. In addition, business has worked with government on a package of supply and demand side measures that can be introduced to alleviate the supply constraints. We are aware there may be companies that have their own generation capacity (used only during load shedding) that they may be willing to use more often to reduce demand on the grid – as long as they are compensated for the increased operational costs. In other positive developments, Sharenet has developed a free web-based service that notifies you of load-shedding-status changes and the times of the current day it will affect your area, as well as providing 15-minute warnings of impending load shedding in your area. For those areas that appear first on the day’s load-shedding schedule, the service also provides early warning to ensure you are not taken by surprise. SAPOA will continue to work with government to find further solutions to the energy crisis. Neil Gopal, CEO

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from the CEO

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from the Editor’s desk

Land reform poses threat to property ownership With the latest proposed restrictions and reforms on land and property ownership, the commercial property industry has raised concerns and questions

and reform, foreign land ownership and property rights have been extensively reported in the media over the past few months. This onslaught of attention came after President Jacob Zuma announced at the State of the Nation Address that the ANC government is proposing strict restrictions and reforms on South African land. The debacle around land reform is nothing new. In July 2010, Dr Edward Lahiff, an expert on South African land reform, was interviewed by POV, television’s longestrunning showcase for independent nonfiction films, where he highlighted that the approaches taken by the South African government have been unsuccessful. “Land reform has fallen very much short of expectations – and official targets – in every respect: in the amount of land redistributed, in the alleviation of poverty and unemployment, in the restructuring of the agricultural economy to create opportunities for previously disadvantaged people, and in protecting small farmers and farm workers from eviction,” said Lahiff in the interview. “Less than seven percent of land has been redistributed [as of 2010], and if the current performance continues, there is no likelihood that the target of one-third will

be achieved even by 2025. Additionally, that one-third figure was always intended as an interim target, with the idea that the ultimate target should be in line with the country’s demographics. To push that interim target back to 31 years after liberation is to abdicate responsibility for fundamental change and to condemn a whole generation to continued landlessness and poverty.”

Current statistics show that foreigners own about three percent of total land property in South Africa. In the UK, the figure is 15%. This particular announcement has caused a stir in the country, among individuals, companies and organisations in the property industry, with several players raising their concerns and questions. “There appears to be a complete lack of understanding of the term ‘land’ when the issue is reform, redistribution, dominant white ownership or foreign buyers,” commented Dr Andrew Golding, Chief Executive Officer of the Pam Golding Property Group. “Are we talking about the basic land itself or about developed land? If developed, then to what extent? Are we talking about farms, factories, office blocks, apartments, houses, private clinics, old-age homes, private estates? Should we be saying to foreign investors, ‘Do come in and build an aluminium plant – but don’t think of buying yourself a house’?” “The President’s announcement that foreigners cannot own land immediately raises concerns about how this will impact foreign land ownership of game farms and foreign investment in hotels in South Africa,” said Martin Jansen van Vuuren, Director of Advisory Services at Grant Thornton. SAPOA has highlighted that it will liaise with the government on the landreform matter. Hopefully some clarity and reassurance on the ANC’s proposals will come to light soon.

Business meeting at its best I had the privilege of meeting George Ross, Executive Vice President and senior counsel of the Trump Organisation, and JT Foxx, serial entrepreneur and the world’s numberone wealth coach, for an exclusive interview for the South African Property Review. With a clear flair for business and a passion for real estate deals, Ross and Foxx are both hugely inspirational. Make sure to read next month’s issue of Review, where we will feature this exclusive story. FROM LEFT George Ross, Executive Vice President and senior counsel of the Trump Organisation; Candace King, SAPOA Publications Editor; and JT Foxx, serial entrepreneur and the world’s number-one wealth coach

Candace King, Editor

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from the Editor’s desk

“Is this the property investment for us?” “It will be.”

In the world of property, patience is a virtue. We’re here to ensure that your rewards will be worthwhile, in the end. We offer long-term financial property solutions that prepare you for any eventuality. www.standardbank.co.za Authorised financial services and registered credit provider (NCRCP15). The Standard Bank of South Africa Limited (Reg. No. 1962/000738/06). Moving Forward is a trademark of The Standard Bank of South Africa Limited. SBSA 201805 – 3/15

Moving Forward

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industry news

Growthpoint to complete a city block of green buildings with its latest Umhlanga development

G The Green on Glenhove office development tees off at Killarney Golf Course

arrow Properties is nearing completion of The Green on Glenhove, a three-storey office development situated on Glenhove Road in Melrose that is ideally suited for a single tenant looking for company headquarters. Neighbouring buildings include the Pharmaceutical Society and other offices grouped along the arterial route feeding into Rosebank. This new 2 753m2 office development’s unique selling points include a prime location, golfcourse frontage and magnificent fairway views, excellent access, innovative architectural design that maximises its location, and optimum highway exposure. “The Green on Glenhove will be a modern glass building that optimises the superb views and exposure to the Glenhove off-ramp from the M1 highway,” says Barrow Properties’ Managing Director Paul Barrow. “The site is unique in its locality, exposure and user experience. In some ways this building can be seen as the gateway to Rosebank, which is fast becoming a highly desirable location for office users of all sizes.” Overall, the building is well-positioned on the Killarney Golf Course, overlooking the 10th green and the 16th tee, and has been designed to maximise the views over the fairways. Occupants will enjoy panoramic views of the golf course from their workplace, which gives visual relief while retaining contact with the exterior and creating an idyllic work setting. Access to the site is off Glenhove Road and visitors will arrive at a double-volume atrium that spills onto a terrace overlooking the golf course. A large balcony on the second floor will look southeast over the course, towards the Johannesburg city skyline. The Green on Glenhove will enjoy easy access to the M1 highway from the Glenhove Road on- and off-ramps, which is of great value, given the congestion that plagues the entry and exit points of many commercial developments in Johannesburg. The building will also provide maximum exposure of a tenant’s brand to thousands of motorists. This is the result of the signage attached to the building’s roof, which will be clearly visible from the Glenhove off-ramp and the M1 highway. Overall The Green on Glenhove provides tenants with a unique location and generous office proportions with a ground floor of 769m2, a first floor of 966m2 and a second floor of 879m2. +27 (0)11 727 3600, Barrow.co.za

rowthpoint Properties is spending R117,3-million on a new green office development, the Boulevard, in its latest investment in the Parkside precinct of Umhlanga New Town Centre. Construction of phase one of the building, which represents 5 441m² of GLA, began in November 2014 and is set to be complete in March 2016. The potential bulk on the entire site for the Boulevard phases one and two is 9 756m². When it is fully developed, the Boulevard will result in the completion of a city block of green buildings in the precinct, providing A-grade office space of 22 000m². Growthpoint Properties was involved in the development and owns the landmark Lincoln on the Lake and Mayfair on the Lake office buildings in Parkside. Both buildings have 4-Star AsBuilt Green Star SA ratings from the Green Building Council of South Africa (GBCSA). Lincoln on the Lake was the first 4-Star As-Built Green Star rating for a multi-tenanted office building in the country back in 2012.

The Boulevard is also targeting 4-Star Design and As-Built Green Star SA ratings from the GBCSA. It is one of two new green Growthpoint Properties office developments in Umhlanga Ridge, north of the Durban city centre. The other is the 6 680m² Ridgeview development in the Ridgeside precinct of Umhlanga Ridge, earmarked to be a 4-Star Green Star rated office building. “Lincoln on the Lake was the first property development in Growthpoint’s portfolio to secure an As-Built rating from the GBCSA,” says Greg de Klerk, Regional Head for Growthpoint Properties in KwaZulu-Natal. “With the development of the Boulevard, we are excited to see the completion of a city block of green buildings right here in Umhlanga.” “Our Lincoln on the Lake and Mayfair on the Lake office buildings in Umhlanga New Town Centre were pioneering green building developments in the Growthpoint portfolio,” says Rudolf Pienaar, Growthpoint Properties’ Office Division Director.

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industry news “We have come a long way and now have six Green Starrated buildings in our portfolio with more under development, which have been submitted or will be submitted to the GBCSA for Green Star certification.” Growthpoint Properties has secured international engineering consultancy firm Royal HaskoningDHV to lease nearly half of the space in phase one of the development. Royal HaskoningDHV will take up the entire top floor and the majority of the third floor of the Boulevard. Growthpoint Properties’ business relationship with the firm goes beyond the lease: Royal HaskoningDHV is the environmental consultant and consulting engineer on the development. The Boulevard is the fifth Growthpoint Properties green building development on which it has partnered with Royal HaskoningDHV. “As an anchor tenant, we believe it is in the best interest of our employees to design an environmentally friendly building and to create a thriving green urban precinct,” says Dominic Collett of Royal HaskoningDHV. “The Boulevard has been custom-designed to be a cutting-edge showpiece of green design in Umhlanga.” In order to comply with the rating certification of the GBCSA, the consultants on the development have carefully

built the following elements into the design and construction of the building: environmental management, construction and operational waste management, indoor environment quality, energy efficiency, reduction of water consumption by harvesting rain water, the optimisation of the structural frame, and storm water attenuation to reduce peak flows. “We have incorporated ‘Green Mobility’ into the design as we prepare the building for a 4-Star GBCSA design rating,” says Collett. “Not only are these offices easily accessible to public transport, they will also feature an electric bikecharging point to allow employees to ride to work and thus minimise carbon emissions.” The innovation is aimed at contributing to decongesting this high density area of vehicle traffic. Growthpoint and Royal HaskoningDHV have also partnered with Cycology on the project in spearheading a new trend of green mobility in urban precincts. Designed by Elphick Proome Architects and with FWJK the appointed quantity surveyors, The Boulevard’s first phase comprises four levels, which includes arcaded retail space at pavement level, with three levels of offices above ground. In addition, it will have three basement parking levels. The development adds to the “new urbanism” environment within Umhlanga New Town Centre and interfaces with the high street in the precinct. The office building will be structured around a central landscaped courtyard. The planning envisages restaurants and retail spilling beyond the arcade onto the high street, delivering a lively edge to the street environment. +27 (0)11 944 6000, Growthpoint.co.za

SA listed property underpins performance of 2014’s top unit trusts

outh Africa’s listed property sector was a key driver of performance from South Africa’s top unit trusts and Raging Bull Award recipients in 2014. Five of the 12 best-performing funds for the year were domestic real estate funds. “This highlights the excellent performance of SA REITs and listed property in 2014,” says Laurence Rapp, Chairman of the SA REIT Association. “Listed property outclassed equities, bonds and cash to deliver total returns of 26,6% and become South Africa’s top-performing asset class for the year. It has also comfortably outperformed all three other assets classes over 10, five and three years.” Absa Property Equity Fund, which recently scooped the Raging Bull certificate for the Best South African Real Estate Fund over three years and, on a riskadjusted basis over five years, was the top domestic property fund (and ranked third overall) with a total return 39,67% for the year to 31 December 2014, according to Morningstar. In overall fourth place is Plexus Wealth BCI Property Fund with returns of 35,29%. In 10th, 11th and 12th place respectively, Sesfikile SCI Property Fund returned 28,82%, SIS Property Equity Fund returned 28,28% and Hollard Prime Property Fund returned 28,26%. Rapp adds that, in addition to South African listed property driving the outperformance of these specialised funds, it is also increasingly being included as an important component in more balanced retirement and institutional funds. “The year 2014 was a watershed one for listed property,” says Rapp. “The investment community really stood up and took notice of the asset class. Adding to its superb track record of strong performance,

the introduction of the new REIT structure to South Africa in 2013 provided a best-of-breed, internationally recognised structure for the publicly traded real estate sector, making it more appealing and accessible to the investment community, locally and globally.” The recipient of the Raging Bull Award for the Best South African Multi-asset Income Fund, Harvard House BCI Flexible Income Fund, attributes its relatively high exposure to listed property as giving it the edge over its competitors in the bond, income and multi-asset income sub-categories. The fund is managed by Willie Pelser, who has maintained an exposure of about 20% of the fund to listed property since the fund’s inception in October 2006. Funds in the multi-asset income sub-category are permitted to have property exposure of up to 25%. The FTSE/JSE Listed Property Index returned 23,1% a year over three years and 16,25% a year over seven years, to December 2014. +27 (0)11 783 2201, Sareit.com

Laurence Rapp, Chairman of the SA REIT Association

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industry news

Waterfall’s new N1 highway overpass bridge to improve Midrand traffic flows

riving through Midrand will soon be a whole lot easier thanks to a new R160million highway overpass bridge being constructed by Waterfall City. The new Bridal Veil Road Overpass Bridge is being developed by Atterbury Property Development and engineers AECOM for and on behalf of Attacq, exclusive holder of the development rights to the prestigious Waterfall City. The major investment for the new overpass is part of the infrastructure development within Waterfall City, the largest “greenfield” urban concept development in South Africa. Strategically located between Midrand and Sandton, Waterfall is positioned to become one of the strongest and most successful nodes in the country. Situated south of the Allandale interchange and north of the Buccleuch interchange, the overpass will create a direct link

between Midrand and Waterfall City, opening up an important route that will make travelling easier and faster for the growing number of people who live and work in this leading Gauteng development node. “Waterfall is designed to be a modern city that really works for its residents and businesses, and this includes providing excellent quality road infrastructure,” says Atterbury Property Development Director Coenie Bezuidenhout, who is responsible for coordinating this immense commercial real estate project. “With the construction of the Bridal Veil Overpass Bridge, these benefits will extend to everyone who uses the roads and highways in and around Midrand and Sandton. In addition to providing another easy access point to Waterfall City, new overpass bridge will help improve traffic flows in the Midrand area, taking strain off

surrounding interchanges and making it easier to get around on Gauteng’s roads.” The superstructure of the bridge will total a length of 115,8 metres and carry four lanes of traffic – two in each direction – a pedestrian walkway, a cycling track and a raised centre median, resulting in a width of 22,7 metres. It will also feature street lighting below and above the bridge, illuminating the N1 highway and Bridal Veil Road. Construction began in November 2014, and the project will take 16 months to complete, with March 2016 as the due date. The development is being

undertaken in strategic phases to minimise disruption to traffic on the N1 while the overpass bridge is being constructed. “Waterfall City’s easy accessibility from Gauteng’s transport network is its inherent advantage – and the new Bridal Veil Road Overpass Bridge is designed to enhance this,” says Bezuidenhout. The new Bridal Veil Road Overpass bridge is scheduled to be completed in time for the launch of the iconic new 127 000m² super-regional shopping centre, Mall of Africa, which will open at Waterfall City in 2016. +27 (0)10 596 9800, Waterfall.co.za

Acucap shareholders vote to join Growthpoint

resounding majority of Acucap Properties’ shareholders have supported all the resolutions of the proposed Growthpoint Properties scheme of arrangement to acquire all the shares in Acucap that Growthpoint Properties doesn’t already own. Accepting the scheme, 91% of Acucap shareholders present or represented at the meeting voted in favour of Growthpoint Properties’ offer. In doing so, they agreed to Acucap becoming a wholly owned subsidiary of Growthpoint Properties. “The overwhelming approval from Acucap’s shareholders shows resounding support for this transaction and is a strong endorsement of Growthpoint’s strategies to create value for its shareholders,” says Norbert Sasse, Chief Executive Officer of Growthpoint Properties.

The transaction is subject to Competition Authorities and Takeover Regulation Panel approvals. Should these be obtained in April, the transaction could be effective from 1 May, at which point Acucap would be de-listed from the JSE. Both companies would pay interim distributions to their investors, with the full income distribution accruing to Growthpoint Properties shareholders from the effective date. Finalisation of the proposed transaction would also see Growthpoint Properties owning Sycom Property Fund Managers Limited and, directly or indirectly, about 99% of Sycom units. “In addition to strategic growth with the excellent assets, the proposed transaction means Growthpoint would take on an experienced asset management

team, benefiting from operational synergies and cost savings with a combined Growthpoint, Acucap and Sycom portfolio,” says Sasse. Implementing the scheme would increase property assets of Growthpoint by R18-billion, to nearly R100-billion. Growthpoint Properties’ local property portfolio alone would grow to more than R75-billion. Importantly, the transaction stands to increase Growthpoint Properties’ retail weighting with assets that complement its existing shopping centres. The retail portfolio would be boosted by nearly R11-billion of significant mall assets across South Africa, including N1 City Mall and Bayside Mall in Cape Town, Greenacres in Port Elizabeth, Vaal Mall in Vanderbijlpark, Paarl Mall in Paarl, Key West in Krugersdorp and Festival Mall in Kempton Park.

Growthpoint Properties would also gain an R7-billion portfolio of quality offices, including prime buildings such as Edward Nathan Sonnenberg in Cape Town, The Woodlands in Woodmead and Tiger Brands in Bryanston. +27 (0) 11 944 6249, Growthpoint.co.za

Norbert Sasse, Chief Executive Officer of Growthpoint Properties

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industry news

Luxury apartment development in Menlyn launched

he City of Tshwane has undergone immense growth in recent years, spurred on by growing investor confidence and investment in infrastructure projects by the local government, says Executive Mayor of the City of Tshwane Kgosientso Ramokgopa. Commenting on the Regency, a luxury residential high-rise that is being developed in Menlyn and marketed by Pam Golding Properties (PGP), the mayor notes that the positive growth in the city and its local economy is serving to further enhance its status as South Africa’s capital. Ramokgopa suggested that Tshwane’s swift development is also causing the boundaries of Pretoria and Johannesburg to become increasingly blurred, predicting that the two regions will in time become one immense African “super-city”, and the continent’s undisputed powerhouse. “I am gratified that my local government has been able to assist in this process and I am pleased to see that our special development framework of 2013 has been instrumental in injecting new dynamism into the local economy,” says the mayor. “One of Tshwane’s most rapidly developing nodes is unquestionably Menlyn. People speak of Menlyn as becoming Pretoria’s new Sandton. I believe that it is eventually going to be larger than Sandton. Menlyn has a highly vibrant mixed economy. Financial institutions, law firms and a range of other professional

service providers, as well as retailers, hoteliers and residents, are flooding into Menlyn. “The creation of the Regency, the first luxury high-rise to be developed in the area, shows that residential development investors see the enormous potential of Menlyn as a mixeduse space. This is exciting news for Menlyn, as well as for the City of Tshwane. We are thus delighted that Key Spirit Developments, which has been responsible for the development of a number of outstanding buildings in the Tshwane region, has taken the decision to create this quality urban lifestyle space for which there is a great need.” The Regency is being built in Ashlea Gardens, close to Menlyn Maine, and is due for completion in 2016. PGP is marketing 146 apartments priced between R995 000 and R2,297-million off plan. “It is Pam Golding Properties’ considered view that the City of Tshwane metropolitan municipality’s immense efforts to promote development and its substantial spend on infrastructure in recent years have greatly assisted in stimulating growth in the Tshwane region as a whole, and especially in nodes such as Menlyn,” says Dr Andrew Golding, Chief Executive Officer of the Pam Golding Property Group. “We commend mayor Ramokgopa and his municipality for their immense efforts to build a first-class capital city.” +27 (0)12 365 2887, Pamgolding.co.za

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industry news

Emira eases the strain on the electricity grid with new solar farm at Epsom Downs Shopping Centre

mira Property Fund has installed a R6-million solar farm on the roof of its Epsom Downs Shopping Centre in Bryanston. This pilot project is Emira’s first step in adding renewable energy solutions to its quality portfolio of properties across South Africa – and part of its sustainability strategy. The photovoltaic (PV) solar farm, consisting of 1 084 panels, will produce around 271kWp, or about 30% of the electricity required by the shopping centre – the maximum possible with its roof size. Emira’s state-of-the-art pilot project will save 515 172kWh of energy and about 252 434kg of coal each year. At the same time it will reduce carbon emissions annually by approximately 503 838kg. To put it in perspective, you would need to plant 458 new trees to offset these emissions. “For some time now Emira has explored ways in which renewable energy can reduce our carbon footprint,” says Justin Bowen, Development Manager at Emira. “With Nersa’s approved increase in Eskom’s tariff rate of about 13% this year, the financial viability for solar farms is becoming achievable. We also recognise the strain on South Africa’s electrical supply; the new Epsom Downs solar farm responds to the call for energy users to reduce dependence on the national grid.” As a carbon disclosure company, Emira measures and monitors its carbon footprint. It is mindful of its environmental and social impacts and strives for sustainability in all areas of its business. Making the success and effectiveness of its pilot PV solar project easy to monitor, Emira’s head office is in the adjacent Epsom Downs Office Park. Emira partnered with Bright Black Solar to supply and

install the system, and its panels were specially imported. The solar farm only took six weeks to construct, but was six months in its planning and logistics stages. While the installation was intended to reduce Emira’s carbon footprint, it has also resulted in other far-reaching benefits. “By taking strain off the power grid, Epsom Downs Shopping Centre is doing its bit to prevent load shedding, and we are sure its customers and neighbours appreciate this,” says Bowen. He believes South Africa could see a greater move towards on-site renewable energy reduction in the near future. “In light of the power crisis, renewable energy – and specifically PV – could improve the amount of power required of the national grid. We foresee a trend towards renewables growing rapidly over the next few years.” +27 (0)11 028 3100, Emira.co.za

Green Building Council launches new Green Star SA Interiors tool

ontinuing its vision to lead the transformation of the South African property sector into an environmentally sustainable industry, the Green Building Council South Africa (GBCSA) has launched its new Green Star SA Interiors tool, taking green building into the heart of every business. The new Interiors tool, sponsored by Standard Bank (main sponsor) and Saint Gobain (supporting sponsor), encourages tenants to rate the interior fitouts of their premises. The aim of the rating tool is to encourage the reduced environmental impact of interior projects. “Our current suite of rating tools focuses mainly on design and construction applied to new buildings and refurbishments,” says Brian Wilkinson, Chief Executive Officer of the GBCSA. “Until now, they’ve had very little consideration for interior fit-outs

inside each premises. Green Star SA Interiors is a key rating tool that will make a significant impact, especially on multi-tenant retail and office space. We are excited to launch this pioneering new tool for South Africa, and believe it will help transform thousands of offices, shops, restaurants and other places, in existing and new buildings across the country, into sustainable green spaces.” “Standard Bank is committed to sustainable business,” says Nathi Manzana, Standard Bank’s Head of Professional and Technical Services. “This commitment is seen in the business practices we conduct, the facilities we manage, and the associations we support. Working sustainably makes sound business sense, supports the environment and provides a productive space for our employees to serve our customers.

“Standard Bank’s new Rosebank office complex is an illustration of this. The building was completed in 2013 and accommodates about 4 500 employees in customer-facing operations. It has achieved a 5-star Green Star SA Design office v1 rating by the GBCSA and a 5-star Green Star SA As-Built office v1 rating.” “Saint-Gobain Gyproc is mindful of the fact that developing green environments requires much more than just energy planning,” says Lisa Reynolds, Sustainability Director at Saint-Gobain Gyproc. “The company’s primary focus is the contribution our products make to the reduction of energy usage at home and at work. We have a number of products in our portfolio designed and developed in line with the company’s commitment to moving towards a greener

environment, ensuring our products are able to contribute to energy-efficient buildings being awarded the highest Green Star certification.” The tool will reward highperformance tenant spaces that are healthy, productive places to work, and incentivise best practice for sustainable and efficient interior fit-outs that are also less costly to maintain and operate. It is designed to allow each tenancy to have unique environmental design initiatives, and to fairly and independently benchmark each one. The Green Star SA Interiors pilot programme has been a success. Various interior fit-out projects at retailers, gyms and offices as well as stand-alone fit-outs at branches are part of the pilot phase. Version one of the tool is now available for public use. +27 (0)86 104 2272, Gbcsa.co.za

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education, training and development

Furthering education Through its prized Bursary Fund, SAPOA continues to raise the bar by supporting the commercial property industry in the funding of scholarships and bursaries for previously disadvantaged individuals

n 2010, SAPOA and Pareto Limited as founders established the SAPOA Bursary Fund with the sole objective to create a fund in the commercial property industry for scholarships and bursaries for previously disadvantaged individuals. We are proud to announce that, from the first intake in 2010, 12 students have already graduated through the SAPOA Bursary Fund and the majority have been placed with member companies. SAPOA President Amelia Beattie, through a pledge system at our 46th Annual SAPOA International Convention and Property Exhibition last year, raised R725 000 in one day for the Bursary Fund. This assisted the Bursary Fund to sponsor nine final year and/ or honours degree students for 2015. Following the shortage of funds from the National Students’ Financial Aid Scheme for 2015, the University of the Witwatersrand initiated the “R1-million, 1 month” campaign, appealing to all sectors of society to contribute towards funding academically excellent and talented students at Wits. By 16 February 2015, about R780 000 had been raised, and the SAPOA Bursary Fund had also pledged that it will support one property studies student through this initiative. SAPOA member companies assisted us in sponsoring an additional seven students, bringing the total number of students funded by the SAPOA Bursary Scheme to 17.

For 2015, the SAPOA Bursary Fund has funded students at the following universities: ●● University of the Witwatersrand (six) ●● University of Johannesburg (seven) ●● University of Pretoria (three) ●● University of Cape Town (one) The intention of the Bursary Fund is to recruit and enrol new students each year, and to reach a stage where the SAPOA Bursary Fund will be in a position to provide (on an annual basis) graduates who are not only qualified in commercial property but to also focus the funding in the areas where skills shortages are experienced in the commercial property industry. Through the vision of Beattie, it is our aim to have at least 50 students on the Bursary Fund when SAPOA celebrates its 50th birthday in 2016. SAPOA as the administrators of the SAPOA Bursary Fund take the total administrative management of the Bursary Fund out of the hands of our members, who can then focus on their core business activities. How will our members benefit from financially sponsoring the SAPOA Bursary Fund? ●● The commercial property industry will have access to qualified graduate property students. ●● Member companies will comply with their BBBEE and Property Charter targets. In terms of the new BBBEE codes, our members can qualify for points on their

score cards under Code 300 (Skills Development) or Code 500 (Socioeconomic Development). The SAPOA Bursary Fund will be in a position to supply a certificate for the above. ●● Member contributions are utilised to educate and train people in commercial property. ●● Scare skills in commercial property are addressed. ●● Members have the opportunity to employ skilled graduates, qualified in property or as mandated.

Martin Ferguson is SAPOA’s HR, Education, Training and Development Manager

The SAPOA Bursary Fund is registered and will issue Section 18A certificates for tax purposes, so participating members will also receive tax rebates. To achieve the SAPOA Bursary Fund objectives, more funds and sponsorships are needed. We are thankful to all our current sponsors but we need more funds to really make an impact on the skills shortages. SAPOA, on behalf of the commercial property industry, makes an appeal to all its member companies to join our current sponsors, and make sponsorships and donations to our Bursary Fund. For more information, please contact: Martin Ferguson Human Resources, Education, Training and Development Manager t: +27 (0)11 883 0679 e-mail: martin.ferguson@sapoa.org.za

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legal update

The MPRA in review Shedding light on condonation applications denied for affected parties other than municipalities with regards to the Local Government: Municipal Property Rates Amendment Act

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

According to Section 50 of the MPRA, any person may within the period stated in the notice referred to in Section 49, if such notice refers to a public notice of the valuation roll, inspect the roll, gain access to extracts of the roll upon payment of a reasonable fee to the municipality, and lodge an objection with the municipal manager against any matter reflected in or omitted from the roll

he Local Government Municipal Property Rates Amendment Bill was published and assented to by the president on 15 August 2014. The Act is known as the Local Government: Municipal Property Rates Amendment Act, 2014 (Act No. 29 of 2014) hereinafter referred to as the MPRA. The intention of the Bill was to address the problems that have been experienced in the implementation of the Act since the commencement of the Act and to promote the effective and efficient implementation of the Act. Of significant importance to rate-payers is Clause 28, which amends Section 80 to limit condonation by the Member of the Executive Council, hereinafter referred to as the MEC, for non-compliance with certain time frames prescribed in the Act to municipalities only. Furthermore, Clause 29 amends Section 81 so as to equip an MEC for local government to more effectively monitor municipalities in the implementation of the Act, and more especially the process of the compilation of a valuation roll, and generally strengthen the monitoring and reporting of compliance provisions of the Act. The fairness and equitability of the aforementioned provisions remains questionable as the rate-payers’ rights are diminished. It is unclear why this provision has been introduced in its current form. The case of MEC Local Government and Traditional Affairs, KwaZulu-Natal v Joachim Hendrik Botha and others (hereinafter referred to as the case) gives clarity with regards to the intention that Section 80 was drafted and the extent to which it applies. Although it was held for the purpose of facts applicable to the case that Section 80 of the Act in terms of which the MEC may grant condonation and extension of time periods is inapplicable and cannot serve as a basis for the late lodging of an objection to the valuation of a property appearing in the valuation roll, the judge found it fit to clarify the position as it has been a topic of much debate.

MPRA procedure for objections According to Section 50 of the MPRA, any person may within the period stated in the notice referred to in Section 49, if such notice refers to a public notice of the valuation roll, inspect the roll, gain access to extracts of the roll upon payment of a reasonable fee to the municipality and lodge an objection with the municipal manager against any matter reflected in or omitted from the roll. In terms of Section 50(4) of the MPRA, a municipal council may lodge an objection against any matter reflected in or omitted from the roll. Section 51(b) requires the municipal valuer to decide the objections on facts, including the submissions of an objector – and if the objector is not the owner, of the owner. Section 53(1) states that a municipal valuer must, in writing, notify every person who has lodged an objection and also the owner of the property concerned if the objector is not the owner. More importantly, Section 54(1)(b) provides that an appeal against the decision of the municipal valuer can be lodged by an owner of a property who is affected by such a decision, if the objector was not the owner. Section 55 of deals with adjustments or additions to valuation rolls, given way by successful objections raised against the valuation of specific individual properties. Section 78 makes possible the provision of a supplementary roll in cases where the properties were incorrectly valued during the last general valuation.

Considerations The case dealt specifically with an appeal concerning the valuation of immovable property by a municipality for the purpose of levying rates in terms of the MPRA. Such valuation of immovable property is situated within the jurisdictional area of a municipality – the Ethekwini Municipality – for the purpose of levying rates on such property in terms of the provisions of the MPRA. One of the aspects dealt with is the question of whether, in the prevailing circumstances, a late objection to a valuation roll may be lodged by invoking Section 80 of the MPRA.

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legal update The property was initially owned by Universal Retail Portfolio (Pty) Limited (URP). On 31 March 2010, URP was finally wound up by an order of the North Gauteng High Court, and on 18 June 2010 the first to third respondents were duly appointed by the Master of the High Court as the liquidators of URP (the liquidators). On 8 September 2011 and in the execution of their duty to liquidate the assets of URP, the liquidators sold the property to a third party for a purchase consideration of R4,35-million. Upon receipt of the clearance certificates by the liquidators, the certificate reflected the amount payable to the municipality in respect of rates to enable transfer of the property to be registered in the name of the purchaser. It was discovered that an amount of R2 708 900 was owed to the municipality by URP as at 12 October 2011. This included assessed and arrear rates of R2 707 200 levied in respect of the property, calculated on the 2008 municipal valuation of R23-million. The liquidators took the view that the 2008 municipal valuation of the property was substantially incorrect and sought to persuade the municipality that the fair market value of the property as at 24 March 2011 did not exceed R4,5-million. Reliance was placed on the valuation of a professional valuer.

The judge held that there is no merit in the contention that Section 80 only extends to applications made by municipalities Judgment The judge held that URP not only misrepresented the 2006 purchase price of the property but also subsequently failed to take any steps to prevent the misrepresentation from materially influencing the 2008 municipal valuation of the property. URP lodged no objection against the valuation of R23-million; in fact, it acquiesced and allowed this hugely inflated valuation of the property to be reflected in the valuation roll for several fiscal periods thereafter. The judge further addressed the question of whether the liquidators who had stepped into the shoes of URP are entitled to enforce any rights under Section 80 of the MPRA, to enable them to lodge a belated objection against the 2008 valuation of the property.

The question was answered by the judge definitively and he held that the liquidators are in no better position than URP and that the liquidators are unable to rely on the provisions of Section 80 of the MPRA to lodge an objection to the 2008 valuation at such a late stage. He held essentially that they had stepped into the shoes of URP (the registered owner of the property at the time of the 2008 valuation) and had “missed the boat” in accordance with prescribed time limits as per the MPRA. The judge also held that there is no merit in the contention that Section 80 only extends to applications made by municipalities, stating that the powers granted to the MEC to grant condonation are of wide import, authorising the MEC to condone any noncompliance with a provision of the MPRA requiring any act to be done only within a specified period. This statement was qualified by the judge stating that the correctness of his view is underscored by the MEC being in the process of seeking an amendment to Section 80 of the MPRA to limit its application to municipalities only.

Section 80 of the amended Act states the following: The MEC for local government in a province may, on good cause shown and on such conditions as the MEC may impose, condone any non-compliance by a municipality with a provision of this Act requiring any act to be done within a specified period or permitting any act to be done only within a specified period. The section is prejudicial to affected parties, which include rate-payers. The inability of rate-payers to find recourse due to the aforementioned section is undesirable and the rationality behind it implausible. The practical implications are that, in the event that an affected party other than a municipality misses the opportunity to object or appeal, the valuation will be applicable for the span of the roll and the owner will then pay rates on that valuation. In such instance, the valuation could be inflated and it would be extremely detrimental for the affected party to pay the incorrect amount based on an incorrect valuation. The effective date for the amended Act is 1 July 2015. SAPOA is liaising with the Department of Cooperative Governance and Traditional Affairs to ensure that the affected parties have recourse in the event of unforeseen circumstances, and to ensure that the objection and appeal process is reasonable. SOUTH AFRICAN PROPERTY REVIEW

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planning and development

Proactive planning In light of proactive participation in municipal business planning, SAPOA has decided to become more involved in the preparation and development of municipal structures, strategies, policies and plans By Lekgolo Mayatula and Andrew Barker

Lekgolo Mayatula is SAPOAâ&#x20AC;&#x2122;s Planning and Development Manager

ANDREW BARKER DEVELOPMENT CONSULTANT

PR.PLN A/079/1985, BSC TRP

usinesspeople constantly look to improve and manage the environment in which they operate, to improve profitability and increase the benefits to their shareholders, stakeholders and communities. As developers and investors in property, SAPOA members operate within the context of municipal structures, strategies, policies and plans. SAPOA has decided to be more proactive and actively participate in the preparation and development of municipal structures, strategies, policies and plans. The most important is the municipal business plan â&#x20AC;&#x201C; the Integrated Development Plan (IDP) â&#x20AC;&#x201C; which all municipalities are required to prepare in terms of the Municipal Systems Act (No. 52 of 2000). While there is a legislative opportunity for business and community stakeholders to participate in the preparation of the five-year IDP and its annual review, SAPOA is seeking a closer, more meaningful working relationship with the municipalities to build a stronger strategic and operational relationship. The IDP seeks to promote cooperative governance between the different spheres of government and to establish partnerships with other stakeholders in the provision of services through an inclusive development-orientated planning process. The IDP is prepared for a five-year period at the beginning of the term of office of municipal councillors, and is annually reviewed to assess performance and accommodate changes in business- and community-stakeholder needs and trends. The legislation sets out the requirements and process for planning, drafting, adopting and reviewing of IDPs, and defines the rights and duties of the municipalities, particularly with regards to developing a culture of community participation and involvement. The core components of the IDP include a vision for the long-term development of the municipality with a particular focus on the most critical development, institutional and internal transformational needs. There is an assessment of existing levels of development and identification of priorities and objectives

for the elected term of the councillors, including local economic development aims. The IDP is the delivery framework for municipalities so it is essential that it be interlinked with the spatial development frameworks at national and provincial level. The spatial development framework (SDF) that is of particular relevance to SAPOA members focuses on the spatial growth and development policy of an area, and prioritises the provision of basic guidelines for land-use management system for the municipality.

The IDP seeks to promote cooperative governance between the different spheres of government and to establish partnerships with other stakeholders in the provision of services through an inclusive development-orientated planning process. The IDP is prepared for a five-year period at the beginning of the term of office of municipal councillors, and is annually reviewed to assess performance and accommodate changes in business and community stakeholder needs The IDP also includes operational strategies, action plans and key performance indicators for the different departments and municipally owned entities. These are the basis for preparing engineering and social infrastructural development plans, and a financial plan with capital and operational budgets. Risk assessments and disaster management plans are also included in the IDP.

Tel: +27 (0)11 680 9791 PO Box 1073, Mondeor, 2110 Fax: +27 SOUTH (0)86 606AFRICAN 9791 144 Berrymead Avenue PROPERTY REVIEW 16 Cell: +27 (0)83 274 4424 Mondeor, 2091 Web: www.andrewbarker.co.za Johannesburg Email: andrew@andrewbarker.co.za South Africa

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planning and development Based on the legislative requirements, the City of Johannesburg has developed a growth and development policy framework consisting of three elements. First, in 2011, the city embarked on an extensive outreach process over a number of weeks, which included various workshops, submissions and the use of mainstream and social media to contribute to the preparation of the Jo’burg Growth and Development Strategy 2040 (GDS2040). SAPOA members participated in this process and contributed to the determination of the desired outcomes from this long-term strategy for the city. The GDS2040, which was also informed by national and provincial planning and policies, identified trends, community issues and needs. The GDS2040 established a long-term vision and mission for 2040 – one that is supported by principles, outcomes, outputs and strategic priorities. This strategic framework provides the basis for the preparation and annual review of the five-year IDP, breaking down the city’s desired long-term objectives into more manageable five-year strategic and operational plans. These plans are the second element. The third element involves the departmental and municipal entity annual business plans as well as the service delivery budget implementation plans. As an important component of the IDP, the identified themes of the City of Johannesburg SDF include strategic densification and compaction of the urban form within the urban development boundary, supported by an emphasis on public transport for spatial transformation and inclusive areas. These themes are the basis for development strategies to support an efficient movement system, ensure strong viable nodes, support sustainable environmental management, initiate and implement corridor development, manage urban growth and delineation of the urban development boundary, and facilitate sustainable housing environments in appropriate locations. These themes and strategies have been the basis for the city to establish the Corridors of Freedom using the Rea Vaya/ BRT transportation system as the basis for ensuring efficient mass public transportation between key areas and nodes of the city. Strategic area frameworks have been prepared for the initial three corridors being EmpirePerth, Louis Botha and Turffontein. Further corridors are planned for the northern areas between Sandton, Randburg, Fourways, Roodepoort and Diepkloof as well as the eastwest mine-impacted areas.

In 2014, SAPOA engaged the professional services of Andrew Barker of Andrew Barker Development Consultant to assist with establishing and building a proactive strategic relationship with the city to improve SAPOA’s involvement in the preparation of the IDP, SDF, and associated policies and plans. SAPOA made a written submission to the City of Johannesburg 2014/2015 IDP review that identified areas of concern and issues relating to the property industry, and effective and efficient investment and development in the city. Based on the process and programme designed by the City of Johannesburg, members of the SAPOA National Developers Forum have been contributing issues and ideas towards SAPOA’s participation in the 2015/2016 IDP review. This has included a productive and informative discussion with Herman Pienaar, the Director of City Transformation and Spatial Planning at the City of Johannesburg. In this discussion it was agreed that there should be more practical involvement and collaboration with the private sector particularly relating to the preparation and implementation of the city’s transformational spatial, residential and economic agendas. SAPOA has also been participating as a member of a reference group, which has been established by the city to review the nature and content of the SDF. The purpose is to formulate and structure a robust development framework that will result in stronger engagement with the integration and complexities of environmental, social, cultural, economic and spatial dynamics of the city. The possibility of establishing a core “think tank” is being considered to focus on the SDF, which will also provide a platform for representation of SAPOA members and provision of local knowledge and understanding from property investors, developers and managers. SAPOA members who wish to participate or contribute to this proactive engagement in municipal business planning, particularly with respect to the City of Johannesburg, can contact Lekgolo Mayatula t: +27 (0)11 883 0679 e: townplanner@sapoa.org.za OR Andrew Barker t: +27 (0)11 680 9791 e: andrew@andrewbarker.co.za

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Rebuilding the Republic Will the commencement of new legislation successfully reshape South Africa’s urban structures? By Michelle Marais

Today, 21 years into our democracy, densities have increased in some urban areas and there has also been partial regeneration of inner cities – but overall, little progress has been made in reversing apartheid geography, and in some cases the divides have been exacerbated

rban planning has always been a valuable lever for leaders to achieve sustainable development. It holds the power to create a framework for collaboration between local governments, the private sector and the public – but the absence of the successful implementation of urban planning can have dire consequences. The Reconstruction and Development Programme introduced spatial planning concepts such as “the need to break down the apartheid geography through land reform, more compact cities and decent public transport” and “densification and unification of the urban fabric” in 1994. Today, 21 years into our democracy, densities have increased in some urban areas and there has also been partial regeneration of inner cities – but overall, little progress has been made in reversing apartheid geography, and in some cases the divides have been exacerbated. In a bid to overcome these challenges, the South African government has adopted a National Infrastructure Plan (2012) with the aim of transforming the economic landscape while simultaneously creating significant numbers of new jobs and strengthening the delivery of basic services. Will this plan, along with the commencement of the new Spatial Planning and Land Use Management Act

(SPLUMA, Act No. 16 of 2013), be enough to empower local municipalities, facilitate better inter-governmental relations and ultimately reshape South Africa’s urban structures?

The state of affairs “I’m of the opinion that South Africa, much like other countries, has migrated (to a certain degree) to an integrated planning platform – it’s a global philosophy,” says Tony van der Merwe, urban planner at UrbanSmart Planning Studio in Pretoria. “Integrated urban planning is gaining significance through the integration of urban planning with innovative disciplines such as geographic information systems and computer-aided drawing programmes. The discipline itself has also gained traction through a better understanding of its value in terms of societal development. Although the results of urban planning usually manifest within a physical environment, the social advantages of urban planning are becoming more and more prevalent through the functioning of our societies in urban areas within South Africa.” Zouna Meades, town and regional planner at the Department of Rural Development and Land Reform in Bloemfontein, believes that urban planners are still trying to undo the damage done by the apartheid regime.

UrbanSmart Planning Studio founder Coenraad Bester with colleague Tony van der Merwe

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South African Planning Institute Chief Executive Officer Cornelia van der Bank

“It’s impossible to separate South Africa’s history, specifically its political background, from urban planning,” she says. “Before South Africa became a democracy, spatial segregation was implemented through buffer areas – and urban planners are still trying to address this through innovative infill planning.” Van der Merwe’s colleague and the founder of UrbanSmart Planning Studio, Coenraad Bester, says that while urban planning is gaining ground in terms of its societal importance, he’s concerned that the credibility of development planning in South Africa is being dealt a blow by continued – and in some instances growing – institutional capacity challenges. “In many instances, developers are being frustrated by approval delays, despite the fact that proposed developments conform to municipal requirements, directives and guidelines,” he says.

Right on trend As competition for resources increases and urban populations expand, it has become paramount that urban planners embrace sustainable development. Without this, cities will become increasingly inefficient. Cornelia van der Bank, Chief Executive Officer of the South African Planning Institute, confirms that sustainable development has been the focus of urban planning for quite some time but that the challenge lies in developing standards to accurately measure this. “Sustainable design must be translated SOUTH AFRICAN PROPERTY REVIEW

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“The employment of planning professionals in the public and private sector is crucial for sustainable development. Even though it is listed as a scarce skill, it is a profession that has, for the longest time, not been properly protected in terms of job reservation” Zouna Meades

Zouna Meades, town and regional planner at the Department of Rural Development and Land Reform

into basic land use controls such as zoning, coverage, floor area ratio, height and parking to ensure accurate implementation and enforcement,” she says. “Our need to plan for the mitigation of environmental challenges such as global warming and dwindling fossil fuel supplies has prompted a movement called pedestrianisation – planning for people instead of for cars,” Van der Merwe explains. “This notion has prompted concepts such as Compact City Form, Smart-Growth and a general shift towards the densification of residential neighbourhoods in support of lesser dependence on personal transportation methods. Locally, we have focused quite heavily on the provision of integrated communities where the provision of housing initiatives is supported by amenities such as clinics, schools, transportation infrastructure and employment opportunities. “Another trend has seen the emergence of industrial development zones – strategically identified areas that are utilised to facilitate investment, improve export and promote the creation of employment opportunities. Richards Bay, Saldanha Bay and East London all play testament to this.”

planning functions to registered professionals in the various categories. Van der Merwe acknowledges the increase in the number of urban planning graduates over the past decade. “This in itself is probably testimony to the growth in popularity and relevance of the discipline – unfortunately, it also poses a challenge in terms of employment opportunities,” he says. “This may be the result of the lingering effects of 2008’s economic downturn, which is deterring firms from being aggressive in terms of employment strategies.” Bester says that, in some instances, it may also be the result of the fact that urban planning learning institutions in South Africa are not producing students who can actively contribute to the industry from day one because they lack the tangible skills. Van der Bank agrees with Bester, believing the challenge lies in graduates gaining the needed experience. “Assisting and supporting young graduates to obtain the necessary experience in both strategic planning and land use management is the true challenge,” she says. “There’s a lack of experienced planners, especially in rural municipalities where this skill is often most needed.”

The planner’s perspective “The employment of planning professionals in the public and private sector is crucial for sustainable development,” says Meades. “Even though it is listed as a scarce skill, it is a profession that has, for the longest time, not been properly protected in terms of job reservation.” The South African Council for Planners has, however, recently implemented the Planning Profession Act (No. 36 of 2002), which will see the reservation of certain

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theme leader Looking towards the future Bester emphasises the fact that the key to urban planning’s future rests in the ability of the public sector to build up capacity that would enable counterparts within the private and public sector to successfully engage one another on a professional level when the development requirements of a development extend beyond the set municipal directives, standards and development directives for an area or type of municipal service. According to Meades, South African urban planning is on the cusp of transformation. “The Development Facilitation Act (No. 67 of 1995) was the primary piece of legislation that guided urban planning in South Africa,” she says. “However, in 2010 it was found to be unconstitutional. SPLUMA will soon be put into practice, and I’m optimistic that it will change the face of planning in South Africa, primarily through empowering local municipalities, primarily through facilitating better inter-governmental relations and fast-tracking development in South Africa. “From the Act’s commencement, it will be a legal requirement for all sector

departments in the three spheres of government – local, provincial and national – to cooperate with local authorities and to ensure alignment of strategic frameworks, from a micro-level (area-based/ structure/precinct plans) to a macro-level (national spatial development framework/ international strategies) of planning.” Van der Bank is also positive about the future and development of South Africa. “I’m confident that our current legislation provides us with the necessary tools to enable planners to make better decisions and promote and improve sustainable development,” she says.

Did you know? There’s a distinct difference between urban design and urban planning. While urban design incorporates architecture with urban planning, the fundamental basis of urban planning is strategic planning and land use management.

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es: i r e a s hly ry c i r Af ont ount e Th our m by-c try focus n cou

Africa uncovered: Democratic Republic

Congo Labelled as the location of Africa’s “world war”, the Democratic Republic of the Congo has been at the epicentre of strife – but after decades of decline, the DRC is slowly recovering By Candace King

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eye on Africa The DRC at a glance ▼ Population 77-million (2014) ▼ Major cities Kinshasa (9-million), Orientale (8,1-million), Bandundu (8-million) ▼ Currency Congolese franc (CDF) ▼ Total area 2 344 858km² ▼ GDP growth 8,1% (2013/2014) ▼ Key industries Mining, mineral processing, consumer products, cement

ituated in central Africa, the Democratic Republic of the Congo (DRC or DR Congo) has experienced a long period of political, social, economical and military turmoil. After gaining independence, the DRC was plagued by political and social instability characterised by civil war, corruption and brutality. Despite being rich in natural resources, the DRC has been wobbling on crutches since 2003 as one of the poorest and most war-riddled countries in the world. It is regarded as the place where Africa’s “civil war” took place – between 1998 and 2003,

millions of people died. The country is still trying to recover from its unstable past. The five-year conflict saw government forces, supported by Angola, Namibia and Zimbabwe, fight against rebels backed by Uganda and Rwanda. The war claimed about six-million lives, either in the fighting or as a result of disease and malnutrition. The fight was over the fact that the DRC is mineral-wealthy: the war had an economic and political angle, and was sparked by the country’s natural assets as all sides aimed to take advantage of its resources. The DRC was established as a Belgian colony in 1908, gaining independence in 1960. It was then called the Republic of the Congo. Thereafter, political and social instability ensued. After a political coup by the dictator Joseph Mobutu, the name changed to Zaire – and he changed his own name to Mobutu Sese Seko. In 1997, the Mobutu regime was toppled by a rebellion backed by Rwanda and Uganda and fronted by Laurent Kabila, who renamed the country the Democratic Republic of the Congo.

Sunset over a river near a fishing village (Photograph by Richard van der Woude/Dreamstime.com)

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eye on Africa Population in millions

1,7-3 3-6,3 6,3-7,6 7,6-9,7

After another regime overthrow and further turmoil, the DRC finally experienced a transitional government in July 2003. Peace talks and treaties have since been in progress to salvage the country. Despite this, people living in the east of the DRC constantly fear death, rape or displacement by military forces. In January 2009, the government tried to rectify the situation by inviting troops from Rwanda to help mount a joint operation against rebel Hutu militias active in eastern DRC. In early 2013, the UN secured a regional agreement to end the rebellion, known as the M23 in the eastern areas. Amid this negativity, the DRC slowly recovered. After dramatically reduced national output and government revenue and increased external debt, the implementation of a transitional government helped the country improve its economic status. Through reforms and international financial aid, progress has been made. Current long-term challenges include an uncertain legal framework, corruption, and lack of transparency in government policy, which is having an impact on the mining sector as well as the economy as a whole. Most economic activity still occurs in the informal sector and is not reflected in GDP data. Positively, there has been renewed interest in the mining sector, the source of most of the DRC’s export income. It has boosted the capital Kinshasa’s fiscal position and GDP growth over the past few years. During 2010-2012, the GDP was about seven percent. In 2013, the DRC experienced growth of 8,1%, which continued in 2014. This was driven by investment in the mining sector, improved agricultural productivity and infrastructure reconstruction. Growth is expected to reach 8,6% in 2015. It’s believed to be driven by mining (copper, cobalt, gold), reconstruction of roads and energy infrastructure, as well as the impact of the agricultural campaign launched in 2012.

The DRC property industry The DRC can be likened to Nigeria in terms of boasting a fast-growing population and a wealth of natural resources – but it’s far less developed than the economy of the west African giant. The population of the DRC is set to rise to 155-million by 2050. Kinshasa is also expected to grow into one of Africa’s megacities in the future. However, the DRC boasts a relatively poor population, and infrastructure and access to basic services are some of the biggest challenges for development and foreign investment. While investors should be cautious to enter, the market could become a positive one in time – there are opportunities resulting from the country’s growing consumer base.

Retail market Most of the DRC’s retail activity is located in Kinshasa. Traditionally, the capital’s retail market has been characterised by local supermarkets with limited parking, and boutiques within hotels. In light of this, modern retail provision remains largely limited. However, the entry of major South African retailer Shoprite has had a positive impact on the retail market. Shoprite became the first major South African retailer to enter the DRC market when it opened in the affluent Gombe area of Kinshasa in June 2011. A year later, there was talk of Pick n Pay entering the market as well. In October 2014, the DRC saw the sodturning ceremony of its first modern retail shopping centre. Situated in the southern mining hub of Lubumbashi, the shopping centre will form part of Luano City, a 300ha,

US$1,4-billion mixed-use development being built on the outskirts of the city. Being developed by South African-based developer Forum Properties Africa, the 6 000m² shopping centre is scheduled to start trading from October 2015, and will feature tenants that include Shoprite (the second store for the DRC), Famous Brands, Innscor from Zimbabwe and Vodacom, as well as a number of local banks, retailers and service providers.

Industrial and office market The DRC’s industrial sector is in desperate need of an upgrade. According to the Knight Frank Africa 2013 Report, Kinshasa’s principal industrial area is in the vicinity of Route des Poids Lourds and Kingabwa, alongside the Congo River and around the port. It comprises mainly older stock, most of it owner-occupied and often in dilapidated condition. There are no modern industrial estates in the country and poor infrastructure hampers transport and logistics. There are also challenges for investors in terms of title ownership, given the level of expropriation during recent conflicts. There is, however, increasing demand for warehousing and storage space to support industrial expansion and, with new roads planned, more areas should become available for modern warehouse development, notes the report. In terms of the office market, most of the existing stock in the capital is of a low standard but there are new buildings under construction, notably in the preferred area along Boulevard du 30 Juin as well as in emerging locations on the outskirts of the city.

Macroeconomic indicators 2012

2013(e)

2014(p)

2015(p)

Real GDP growth

7,2

8,1

8,5

8,6

Real GDP per capita growth

4,6

5,6

6,0

6,1

CPI inflation

2,7

1,1

3,2

3,8

Budget balance % GDP

-1,7

-3,7

-5,9

-7,2

Current account balance % GDP

-6,2

-9,1

-10,1

-10,4

Source: Data from domestic authorities; estimates (e) and projections (p) based on authors' calculations

Kinshasa prime rents and yields Prime rents

Prime yields

Offices

US$35/m2 per month

11%

Retail

US$40/m² per month

12%

Industrial

US$8/m² per month

14%

Residential

US$8 000 per month*

Source: Knight Frank LLP * Four-bedroom executive house – prime location

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ABOVE Many village settlements in the DRC are situated along roads BELOW LEFT The Kinshasha's skyline BELOW RIGHT Non-timber products, such as the edible forest fruits sold by this woman in Libenge, Équateur, provide a substantial share of poor households’ livelihood and income BOTTOM The DRC has the largest artisanal mining workforce in the world, estimated at around two-million people (Photographs courtesy of UNEP/Flickr.com)

According to the Knight Frank Africa 2013 Report, occupiers are outgrowing their space in the popular diplomatic area of Gombe, which is home to most of the capital’s modern buildings. Demand is primarily from domestic occupiers, particularly from the public sector, banks and Congolese/ Belgian conglomerates, while international corporates with a presence include Citi, Orange and Ericsson. The first A-grade office buildings in Luano City were completed recently, and more than

30 000m² of office space will become available over the lifetime of the project.

Residential market Developers in the residential market nearly always build properties that are to be rented, rather than for sale. Stimulated by the diplomatic sector, NGOs and the UN, there is a strong appetite for high-end residential properties to lease. In terms of prime projects, 60 residential units will be constructed as part of a new phase of Luano City.

City populations Population

Population density (persons per km2)

Land area (km2)

Kinshasa

9 046 000

908

9 965

Orientale

8 197 975

503 239

Bandundu

8 062 463

295 658

Équateur

7 501 902

403 292

Kasai Oriental

6 556 917

170 302

Nord-Kivu

5 767 945

59 483

Katanga

5 608 683

496 877

Kasai Occidental

5 366 068

154 742

Sud-Kivu

4 614 768

65 070

Bas-Congo

4 522 942

53 920

Maniema

2 049 300

132 250

Source: Opendataforafrica.org SOUTH AFRICAN PROPERTY REVIEW

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●

s●

monthly coun our

Th e WOR

by-country focu try-

Did you know? Argentina’s government became the first in the world to be censured by the International Monetary Fund for misreporting statistics in 2013.

With economic uncertainty still prevalent and political controversy clouding its image, Argentina is struggling to keep its head above water By Candace King

Key facts ▼ Population 41,45-million (2013) ▼ Major cities Buenos Aires, Mendoza, Córdoba, Santa Fe de la Vera Cruz ▼ Currency Argentine peso (ARS) ▼ Total area 2 780 400km² ▼ GDP growth Three percent (2013) ▼ Key industries food processing, motor vehicles, consumer durables, textiles, chemicals and petrochemicals, printing, metallurgy, steel 26

Cry for me, Argentina L

ike Africa’s Nigeria, Argentina is Latin America’s double-edged sword. With a gross domestic product (GDP) of more than US$510-billion, the country is one of South America’s largest economies, rich in natural resources and with a well-educated workforce. It is, however, plagued by a rocky political past, suffering from corruption and struggling to maintain economic stability. Situated in southern South America and bordering the south Atlantic Ocean between Chile and Uruguay, Argentina stretches 4 000km from its sub-tropical north to the sub-Antarctic south. In 1816, the United Provinces of the Rio Plata declared their independence from Spain, and after Bolivia, Paraguay and Uruguay went their separate ways, the area that was left over became Argentina. The people and culture were largely influenced by European immigrants between 1860 and 1930. Argentina’s population has had to struggle with military dictatorship – the country’s history has been dominated

by bouts of internal political conflict between Federalists and Unitarians and between civilian and military factions. One of Argentina’s most famous political movements is that of Peronism, which was based on the legacy of former president Juan Domingo Perón and his second wife, Eva Perón. The Peronist ethos was based on social justice, economic independence and political sovereignty. The Peronist political party, the Justicialist Party, has been the largest party in the congress since 1989. After a military junta that took power in 1976, democracy was restored by force in 1983 following a lost war over the Falkland Islands (Islas Malvinas). To this day, Argentina continues to maintain its claim to the islands. Democracy has persisted despite several challenges, specifically the economic crisis and deep recession in 2001-2002, which led to violent public protests and the resignations of several successive presidents. The recession also left more than half of the population living in poverty.

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A night perspective on the Palace of the Argentine National Congress, the seat of the legislative branch of the government © GameOfLight

An Argentinian tale of two cities Argentina has had the best and the worst of times. Economic difficulty has long hampered the country, and it has battled with record debt defaults and currency devaluation, persistent fiscal and current account deficits, high inflation, mounting external debt and capital flight. By 2003, economic recovery had been implemented. The International Monetary Fund (IMF) agreed to a new loan; Argentina has since restructured its massive debt, offering creditors new bonds for the defaulted ones, and has repaid its debt to the IMF. Despite slight recovery, poverty is rife and unemployment is still high. After Cristina Fernández de Kirchner became president in 2007, Argentina’s economic growth slowed sharply, and has been yo-yoing since. GDP in Argentina averaged US$181,49-billion from 1962 until 2013, reaching an all-time high of US$611,76billion in 2013. (The year 1963 recorded a record-low GDP of US$18,27-billion.) Argentina’s saving grace is its abundance of natural resources: the country boasts the world’s second-biggest shale gas reserves and fourth-biggest shale oil deposits.

It also benefits from an export-oriented agricultural sector and a diversified industrial base, and is one of the largest exporters of beef in the world and the top world producer of sunflower crops, lemons and soy-bean oil. Its population size is also an asset. The education system is the best in Latin America, and it supports quality local manufacturing, technology and service companies.

Did you know? Famous around the world, Argentina’s football team is nicknamed the “Albicelestes”, which means “sky blue and whites”. ABOVE Argentina's football team © Ludovic Péron TOP Floralis Genérica – a sculpture made of steel and aluminium – is located in the Plaza de las Naciones Unidas in Avenida Figueroa Alcorta, Buenos Aires

Argentina economic data 2009

2010

2011

2012

2013

GDP per capita (US$)

9,558

11,525

13,717

14,688

14,758

GDP (US$-billion)

379,2

462,4

556,5

602,6

612,4

Economic growth (GDP, annual variation in %)

-0,7

9,4

8,6

Investment (Annual variation in %)

-14,6

21,2

18,2

-5,2

Industrial production (Annual variation in %)

0,1

9,7

6,5

-1,2

-0,2

Retail sales (Annual variation in %)

10,8

16,4

17,1

14,7

18,8

Trade balance (US$-million)

16,9

11,4

9,7

12,2

Exports (US$-million)

55,7

68,2

84,1

80,2

81,7

Imports (US$-million)

38,8

56,8

74,3

73,7

Exports (Annual variation in %)

-20,5

22,5

23,3

-4,5

1,8

Imports (Annual variation in %)

-32,5

30,9

-8,5

8,3

External debt (% of GDP)

30,8

28,3

25,6

23,8

Source: FocusEconomics SOUTH AFRICAN PROPERTY REVIEW

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Did you know? Situated in the Los Glaciares National Park in southwest Santa Cruz, the Perito Moreno Glacier is one of Argentina’s biggest tourist attractions. ABOVE The perpetually wintry face of the Perito Moreno Glacier OPPOSITE Puerto Madero waterfront in Buenos Aires by night © Maritè Toledo

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Argentina also enjoys relatively stable relationships with other countries, including Brazil and Venezuela. Recently, Argentina has experienced positive growth in the domestic industry, especially in the automotive, textile and appliance sectors. While these sectors are performing well, the property industry is experiencing a bubble.

Real estate in a rut As a result of economic and political instability, the Argentinian real estate industry is being hit hard. As the economy slowed, so did the interest and activity in the property market. Foreign investors have shied away from the market because of its instability. President Fernández’s popularity is waning and inflation continues to be a big problem.

In addition, the value of the Argentine peso is plummeting and the country’s economic outlook is bleak. This uncertainty is greatly hampering Argentina’s property market. Another critical issue is the fact that the real estate industry is pretty much a dollaronly market, which is causing issues for buyers and sellers. Sellers want to be paid in dollars but buyers are prevented from acquiring these dollars because of strict currency controls. One of the positives of the property sector is the development of green buildings. In recent years, there has been increased demand for buildings that implement and utilise green technologies. Boasting its own Green Building Council, Argentina has begun to focus on green building technologies. Residential and commercial buildings consume 54% and 46% respectively of the country’s total energy. Thirty-eight percent of the total amount of carbon dioxide in Argentina can be attributed to buildings, with 21% attributed to homes and 17,5% to commercial users. Buildings also account for 12,2% of the total amount of water consumed per day in Argentina. Due to the country’s manufacturing of low-technology building products, there is a massive market for specialised and cuttingedge technologies.

All the best Looking ahead, things may get even rockier for Argentina. While the current economic situation is sluggish and inflation is high, the transition to a new government in December 2015 may add even more instability to the mix. Furthermore, social unrest over corruption is mounting – a matter that the government will need to face and deal with. Unrest over the death of state prosecutor Alberto Nisman, who had accused the president of conspiracy, in January 2015 is also expected to escalate the negative sentiments in the country. SOUTH AFRICAN PROPERTY REVIEW

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THIS PICTURE Head Office of Broll Property Group (Pty) Ltd - Illovo, Johannesburg OPPOSITE PAGE Malcolm Horne, Group Chief Executive Officer for the Broll Property Group

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Forty years of property excellence H

aving turned 40 this year and with a growing African footprint, Broll Property Group remains passionate about property and continues to serve its clients with flair and a forward-thinking attitude. Its services include asset management and consulting, auctions and sales, occupier services, facilities management, industrial, investment and office brokering, property and project management, retail leasing and projects, research, shopping centre management, valuation and advisory services, and a vast database of properties across South Africa and sub-Saharan Africa. Apart from South Africa, Broll has offices in Ghana, Kenya, Malawi, Mauritius, Madagascar, Mozambique, Namibia, Nigeria, Reunion, Rwanda, Sierra Leone, the Seychelles, Uganda and Zambia, and operates in more than 17 countries across sub-Saharan Africa. Affiliated to CBRE, a renowned global commercial real estate and investment firm, Broll is able to offer its clients unrivalled local expertise and global market knowledge.

Humble beginnings Broll was born on 15 January 1975. From humble beginnings in Cape Town with founder and non-executive chairman Jonathan Broll, the company has grown and currently has a staff compliment of more than 1 350. “We are proud of our 40-year history as we have built an organisation with great people, clients and a track record of service delivery across the continent in specialist property disciplines,” says Malcolm Horne, Group Chief Executive Officer for the Broll Property Group. Broll thrives on customer satisfaction, always putting its clients’ needs first, solving their problems and identifying opportunities to enhance their businesses. “As we enter our fifth decade, we are greatly inspired and excited about what lies ahead, with some markets developing and other property markets maturing,” says Horne.

Africa expansion and new service lines The first Broll office outside of South Africa was in Namibia 12 years ago followed by West Africa in 2004. In 2004, explains Horne, Broll signed the CBRE affiliate agreement – and it is through this affiliate that the company is able to offer the combination of local expertise and international market knowledge.

Apart from expanding into Africa, Broll is renowned for adapting to an ever-changing and challenging market environment. In January 2015, the company launched Broll Auctions and Sales, a new service line within the group that specialises in property auctions, tenders and private treaty sales. Broll Auctions and Sales held its first multiple property auction on 26 March at the Wanderers Club in Illovo, Johannesburg. “Broll has also launched a specialised Occupier Service, which recognises the different business drivers focusing on delivering services to all occupiers of space where we are retained by the occupier as client,” says Horne. With a wide range of specialist functions, Occupier Service is able to tailor an offer to match the requirements of each client. These functions include providing strategic portfolio reviews and advice to a fully integrated, outsourced property service including data management, finance/treasury, transactions and estates management functions. “These services are not confined to South Africa,” says Horne. “We have Occupier Service hubs in Lagos, Nigeria; Nairobi, Kenya; and Johannesburg, coordinating client activities across sub-Saharan Africa both by utilising the network of Broll offices and selected service partners in countries where we do not currently have an office.” Occupier Service also works closely with CBRE to provide a truly integrated international service. “With these service lines, the group has positioned itself with the depth of services we provide to our occupier client base,” says Horne. “Companies need to constantly adapt to ever-changing market conditions and needs, thus giving us a competitive edge over our competitors.”

After 40 years of property excellence, Broll Property Group is one of Africa’s leading property services companies, serving the investor and occupier markets By Candace King

Leasing as a speciality The group keeps track of the latest developments in the industrial, office and retail sectors, with expert analysis of specific locations and segments within the core sectors through its dedicated research division and experienced property professional teams. The group has one of the most experienced and dynamic leasing teams on the continent, and has concluded some of the largest commercial property deals in South Africa. SOUTH AFRICAN PROPERTY REVIEW

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cover story “Current sluggish economic Auctions growth is having a negative impact on industrial property investment in KwaZulu-Natal, resulting in an upward movement in rentals”

While there is a perception that auctions are for distressed sellers, Broll says this is not necessarily the case – some property owners and sellers prefer the auction method to the traditional way of selling property (which is often a very lengthy process). Auctions are fast becoming a preferred method for buying and selling property for many investors. The auction process is transparent; buyers pay a fair market value for the purchase. What’s more, buyers also know they’re dealing with a serious seller who’ll price right and in line with market expectations. With its first successful multiple auction out of the way, Broll points out that quality stock results in a successful auction despite the time and place – because good stock always sells.

Industrial According to Broll, the industrial market in Durban is seeing a decrease in supply while demand remains stable. “Current sluggish economic growth is having a negative impact on industrial property investment in KwaZuluNatal, resulting in an upward movement in rentals,” he says. Furthermore, there is limited new stock being built in Durban because of expensive land and high rentals. Municipal rates in Durban are also reportedly the highest in SA, thus putting downward pressure on yields. However, the Broll team points out some exciting nodes to watch out for, including the mega Cornubia development in the north near Mt Edgecombe and Hammarsdale and Cato Ridge – the only locales to offer serviced industrial land in the Durban Municipal area. Cornubia is highly successful while the Dube TradePort development at the King Shaka Airport has also enjoyed a lot of success since it has been declared a SEZ (special economic zone) by the government in October 2014. Due to high land costs in Durban, there is a price hike in rentals – landlords want to use up the maximum allowable coverage, which is contrary to what logistics companies want, according to the brokers. Broll brokers in KwaZulu-Natal say in 2015 we should expect a five-to-seven-percent rentals increase because of the sluggish economy, which has resulted in stable demand and dwindling supply.

Offices

tel: +27 (0)11 441 4000 email: info@broll.com web: www.broll.com 32

Broll has specialised commercial leasing teams operating in Cape Town, Durban, Bloemfontein and Johannesburg. “In Gauteng, the office market is active but there are concerns about the current energy issue,” says office brokers in Gauteng.“It’s putting a damper on international companies looking to grow.”

The brokers say, in Sandton, international companies (mainly in the financial sector) are downsizing and looking to sublet portions of their space. These additional vacancies are putting pressure on rentals. “Everybody wants to be close to public transport but parking requirements are still very high as more people are being accommodated in open-plan spaces.” Further to that, green office buildings are in demand because of energy costs. Smaller local companies are looking at purchasing sectional title or small stand-alone offices in the major office nodes. Rentals are high and small businesses prefer to invest in something that will give them capital gain instead of paying rent. In terms of the office market in Sandton, brokers predict that we are going to see more space come onto the market as more firms are rationalising. A lot of new developments will be completed in 2016 and will essentially add more office space to the market.’

Retail As far as retail is concerned, Broll notes that vacancies in major Western Cape shopping centres are low at less than two percent. “A big trend that is being seen in the Western Cape is the return of retail into trendy nodes such as Regent Road Sea Point, Green Point Main Road, Kloof Street Gardens and Bree Street in the City Centre,” he says. “Another trend is the expansion and refurbishment of existing malls.” With international retail brands such as H&M entering the market, Broll believes this will have a positive impact on the South African retail sector. “It’s good for consumers, creates competition, offers customers more choice, and stimulates job creation.” In South Africa, rural and township development continues to be a driver of retail development. This really is a growth sector in the market. In Africa, particularly West Africa, rentals are higher than in East Africa and there are numerous retail developments currently under construction in Angola, Ghana, Kenya, Mozambique and Nigeria. “We are seeing a highly saturated market in South Africa, which is pushing a lot of retailers to move north and expand,” explains Broll. “Interestingly, local African companies such as Choppies out of Botswana and Nukamatt from Kenya are starting to expand.” Broll maintains there is demand for quality retail space in Africa – developers want sites in cities that offer large populations and attractive growth rates. As a result, more retail schemes are popping up across the continent.

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Transforming Tshwane Through its efforts to partner with the commercial property private sector, the City of Tshwane is set to metamorphose into a resilient and inclusive city with great social and economic opportunities via catalytic initiatives By Candace King Photographs by Erik Forster

“N “A fundamental premise of the City of Tshwane’s long-term strategy, embodied in Tshwane Vision 2055, is that the city strives towards being liveable, resilient and inclusive – a city whose citizens enjoy a high quality of life, have access to social, economic and enhanced political freedoms, and are partners in the development of an African capital city of excellence” Councillor Kgosientso Ramokgopa, City of Tshwane Executive Mayor

o matter the path of economic development a country has chosen, urbanisation remains an inevitable outcome of this effort across the world,” according to UNHabitat’s State of the World’s Cities 2010/2011 – Cities for All: Bridging the Urban Divide report. At the beginning of the 20th century, 16 cities in industrialised economies were home to a million people or more. Today, almost 400 cities contain this kind of population or higher, and these are generally located in low- and middle-income countries. Over the next 30 years, most of the growth in the world’s population is expected to occur in the cities and towns of poor countries. By 2020, the developing world as a whole is likely to be more urban than rural. South Africa’s National Development Plan envisages that, by 2030, 11-million more South Africans will inhabit cities. This transformation will be a powerful force in shaping the social, economic and political discourse over the next century. Economic growth and urban growth will continue to be inextricably intertwined. The above features in the City of Tshwane’s Annual Economic Landscape Report 2015, which offers all stakeholders in-depth information, data and analyses that provide insight into key opportunities within the city.

The report places Tshwane within the global and local economy. “A fundamental premise of the City of Tshwane’s long-term strategy, embodied in Tshwane Vision 2055, is that the city strives towards being liveable, resilient and inclusive

Tshwane in numbers • The City of Tshwane is home to more than three-million people. • The city covers 6 368km2 of Gauteng’s total 19 055km2, stretching almost 121km from east to west and 108km from north to south. This makes it the third-largest city in the world in terms of land area after New York and Tokyo – and the single largest jurisdictional area in the world. • The city hosts the second-largest concentration of embassies in the world after Washington DC. • It’s a leader on the African continent in providing affordable industrial sites, various industries, office space, education and research facilities. • The city is responsible for approximately 48% of the research and development output in the country. • According to the latest findings in the Gauteng City Region Observatory’s Quality of Life 2013 survey, the City of Tshwane has been declared the most liveable city within the Gauteng region. • The city accounts for 27% of Gauteng’s GDP and 10% of the total national GDP. • It’s the fastest-growing economy, on average, for the past 15 years.

City of Tshwane Executive Mayor Kgosientso Ramokgopa

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SAPOA President Amelia Beattie, SAPOA CEO Neil Gopal and City of Tshwane Chief Economist Shaakira Karolia

– a city whose citizens enjoy a high quality of life, have access to social, economic and enhanced political freedoms, and are partners in the development of an African capital city of excellence,” says the City of Tshwane Executive Mayor Kgosientso Ramokgopa in the foreword to the Annual Economic Landscape Report 2015.

Investing in the future In light of the City of Tshwane’s serious attitude and set goals towards improving the city by 2055, the city, in collaboration

and association with SAPOA and High Street Auctions, hosted an investor summit on 19 February 2015. The inaugural City of Tshwane Investor Summit 2015 aimed to engage business as potential strategic partners on the City of Tshwane’s key catalytic capital projects, incentive framework, and public auction of council-owned land. In terms of the city’s incentive framework programme, long-term local economic development within the boundaries of the city will be stimulated.

“The city’s incentive framework programme was passed by the council in November 2014. It highlights the city’s long-term growth and development. City incentives are offered in various countries across the world – so we too need to move investment along via incentives” Shaakira Karolia, City of Tshwane Chief Economist

Jason Ngobeni, City of Tshwane Manager

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SAPOA President Amelia Beattie

Shaakira Karolia, City of Tshwane Chief Economist

The 2015 Summit marked the official launch of the city’s incentives programme. “The city’s incentive framework programme was passed by the council in November 2014,” said City of Tshwane Chief Economist Shaakira Karolia. “It highlights the city’s long-term growth and development. City incentives are offered in various countries across the world – so we too need to move investment along via incentives. We want to catalyse development on open land parcels. To achieve this, extensive public participation will be held. A committee has been established to deal with stumbling blocks – such as fasttracking zoning applications and reducing red tape – as they arise.” For some time, SAPOA has been engaging with the City of Tshwane and its mayor in an effort to forge a strong relationship between the public and private sectors. “On 27 February 2014, an exclusive dinner was held in Tshwane,” said SAPOA President Amelia Beattie at the Summit. “It was attended by the mayor, city officials, SAPOA member CEOs and the Board of Directors of SAPOA. When the SAPOA Board first initiated the idea of our Meet the Mayor dinners in 2013, the intention was to facilitate detailed interaction between property owners, members of SAPOA and the local government. The purpose and intention of the dinner was to find ways to improve strategic partnerships between the private and public sector. We recognise that good communication with local government is essential for the positive performance of the commercial property sector in South Africa.

“Based on the positive results of these meetings, the mayor of Tshwane requested to host this summit in partnership with SAPOA. Such initiatives encourage debate on the challenges facing our members, create access to development opportunities and infrastructure expansion, and remove investment obstacles.” “It’s important to have such conversations in order to grow and develop the city,” said Ramokgopa. “We want to see relationships develop with various private partners.” “Our aim is to create a resilient, inclusive city with access to social and economic opportunities,” said City of Tshwane Manager Jason Ngobeni. “As government, we realise that we cannot do this by ourselves. We acknowledge the private sector as a partner.” In an effort of stimulating investment, the city has embarked on a process of optimising the mechanism utilised in the disposal of some of the most lucrative parcels of land within the city for a variety of development options. The aim of the project is to catalyse development and enhance the city’s fiscal sustainability. Approximately 80 land parcels worth more than R500-million have been identified for disposal by the city by way of public auction. The first-ever public auction of government-owned land within South Africa took place on 24 March 2015. “At High Street Auctions, we are privileged to have been commissioned by the City of Tshwane to be a part of this innovative land release programme,” said Lance Chalwin-Milton,

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joint Managing Director at High Street Auctions. “These land parcels represent the jewels of the city. The land auction highlights the biggest property-auction undertaking in the history of South Africa.” “The City is taking into account (and acting on) the ever-growing infrastructure demand,” explained Councillor Subesh Pillay, Member of the Mayoral Committee for Economic Development and Planning at the City of Tshwane. “We want to catalyse developments in the city. The public auction of government-owned land constitutes just under 10% of our total land portfolio. We need to optimise the value of these land parcels. Land plays a critical role in transformation. We want black individuals to play a much more significant role in our city as well as in property.” “We need to resolve the current social construct,” said Ramokgopa. “We need to close the inequality gap. We need to hit the mark in addressing social conflict. It’s about

Catalytic projects Some of the city’s core catalytic investment projects include: • The roll-out of free WiFi across the Tshwane region; • Integrated public and non-motorised transport network, including but not limited to the continued development of the A Re Yeng Tshwane BRT system; • The Government Boulevard project, which will provide a long-term accommodation solution for all government head offices; • The mixed-use pioneering West Capital development, which is a major urban renewal project with a focus on residential and student accommodation; • The East Capital development, which will focus on creating a “green belt” of industries, agricultural benefication and green settlements; • The African Gateway development, which will elevate the city as the biggest convention destination; • Symbio City, which includes the development of the tallest building in Africa; • Tshwane House, the state-of-the-art municipal headquarters in the heart of the inner city.

Tshwane Vision 2055 In terms of realising Tshwane Vision 2055, the following phases will be followed over the next four decades of change: • By 2020: Consolidating the gains of democracy and tackling the triple challenges of unemployment, poverty and inequality • By 2030: Managing sustainable urban growth and development • By 2040: Transitioning towards a sustainable urban form and economy • By 2050: Consolidating the gains towards a better and more prosperous life for all

The City of Tshwane Inaugural Investor Summit 2015 aimed to engage business as potential strategic partners

meeting capital needs and developmental change – on the one side you can reach your capital targets and on the other you can make a difference in the city.” “The development of these land parcels will have a significant impact on our economy,” said Pillay. “The properties are estimated to generate a little more than R3-million annually. When fully developed, these properties will be generating a yield of R45million, which represents a R26-billion injection into the economy. Furthermore, 42 000 jobs are expected to be created.”

Realising the vision “The reality is that we as the industry and local government are inseparable, and we have to work together,” said Beattie. While the city remains focused on its catalytic projects, it also highlights that it will not lose sight of excelling at basic service delivery for residents through its urban management programme, radical green economy and resilience programmes, the formalisation of informal settlements programme, and the surfacing and tarring of roads in township areas (among many other programmes). “We are certainly open for business and we look forward to your partnership,” said Pillay. “We need to create a kinetic city – a city that has the ability to rapidly and clinically respond to and resolve daily challenges,” said Ramokgopa. “This is not just about the gavel but also about a social change.” The city’s ultimate mission at present? “We must transform the lives of residents of Tshwane during the current decade of Tshwane Vision 2055. The City of Tshwane’s projects have indeed begun in earnest.”

“At High Street Auctions, we are privileged to have been commissioned by the City of Tshwane to be a part of this innovative land release programme. These land parcels represent the jewels of the City. This land action highlights the biggest property auction undertaking in the history of South Africa” Lance Chalwin-Milton, joint Managing Director at High Street Auctions

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THIS PICTURE The Summer Rain Private Estate bachelor’s apartment is perfect for young professionals BELOW Harold Spies, developer of Similan Consult

Changing the way we live The development agency, Similan Consult, is shifting the way South Africans view low-cost housing By Nicky Manson

“We’ve created an unlikely pair of housemates: affordability and top quality” Harold Spies

ore and more people in South Africa are choosing to live in security estates, investing in either free-standing or sectional title homes, or even renting. The reasons are many. Security is an obvious one. Affordability, particularly for those in the lower-income markets, is another motivator, as is the growing social need to return to a more convivial community way of life. Associated with the security aspect and the societal reasons is the added benefit of living in a place where kids can run free in safety and parents can relax in parklike surroundings in the company of likeminded neighbours. Until recently, the expenses of creating such a desirable lifestyle had placed estate living out of reach of first-time home-buyers who aspire to a way of life that reflects their professional or educational status and their need for living in a place of which they can be proud. Not any more. Challenging a status quo that had become synonymous with hastily built, sub-standard homes to cater for the burgeoning lower middle-class, Harold Spies of Similan Consult set out to prove that affordable need not mean shoddy. His questioning attitude and insistence on planning, building and managing affordable

residential estates to previously unheard of levels of quality have been recognised – not only by the thousands of happy residents at Similan developments but also by the South African Housing Foundation, which awarded the Housing Project of the Year 2014 award to Karino Lifestyle Estate outside Nelspruit. “We’ve created an unlikely pair of housemates: affordability and top quality,” says Spies, who established Similan Consult in 2010. Similan Consult is responsible for a number of award-winning community estates. In addition to focusing on residential developments, the company also provides project-management and development-consultancy services. The residential developments that Similan conceives, develops and manages are all conveniently located, attractive, secure, tastefully finished and well maintained. More importantly, they are within easy financial reach of first-time home-buyers. The Karino Lifestyle Estate is such a place. One of the safest and most affordable estates in South Africa, it is located in Nelspruit, in the warm province of Mpumalanga. Home to more than 1 600 residents, the estate boasts an array of homes and apartments with an option to rent or buy. Currently only 13 of the 576 homes that went on sale are still available for purchase.

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themefeature leader Ingeniously, Karino was built in such a way that it can eventually become a satellite town of Nelspruit. Already its residents enjoy access to the Meridian Karino Private School, the Crossings Shopping Centre and other amenities. There is even a church on the property, where Pastor Maseko of the Divine Praise Ministries preaches to a growing congregation. The Karino Lifestyle Estate offers a sense of privacy and exclusivity. It provides a living space away from the hustle and bustle of the suburbs, with large open spaces and parks that are kept pristine by the gardening staff. Residents’ children enjoy the swings and jungle gyms and the freedom of riding their bikes and scooters. At Karino, Spies had two goals against which to measure its success. “The first was to make sure the children living in Karino were safe and happy, and the second was to make sure I’m proud enough of what we build that I want to show it to my friends and family,” he says. “These personal goals became the driver behind what we now consider a solid investment.” With Karino Lifestyle Estate almost fully occupied, Similan has turned his expertise to developing Karino’s new neighbour, Summer Rain Private Estate. Set to follow in Karino’s footsteps, the new estate will offer a choice of rental (bachelor, two-bedroom and threebedroom apartments) and purchase options in a number of price brackets. Similar in design intent to its predecessor, park-like spaces have been planned, and the layout of the estate offers visual variation and aesthetic appeal created by differences in height, building designs and wall colours. Summer Rain Private Estate is also conveniently close to Meridian Karino Private School and the new bus route. Selcourt Estate is Gauteng’s success story. Situated outside Springs, the estate’s 1 500 new two- and three-bedroom houses and a variety of apartments will soon provide secure living and a healthy lifestyle for homeowners in all income groups.

A unique exploration park has been built at Selcourt. “The concept is to offer residents and their friends a safe haven where they can meet and mingle, play sport or simply chill,” explains Spies. “The park is a leafy landscaped space of more than one hectare and includes mazes, tunnels, specially designed jungle gyms and equipment, which helps to improve children’s hand-eye coordination and develop their motor skills. Hoops, tennis courts and mini soccer fields complete the picture.” The homes at Selcourt Estate are constructed in various designs and sizes, offering different exterior finishes such as multiple roof types, tile colours, a choice of wall colours, and quality fittings. Particular attention has been paid to the layout of the estate. The homes have been positioned to take maximum advantage of the natural features of the site and are oriented for optimal energy efficiency. They comply 100% with the latest energy specifications of SANS 10400-X. The layout features circular streets and culs-de-sac, creating pockets of communities. It’s clear Similan Consult has addressed South Africa’s shortage of accommodation and challenged the norm of entry-level housing in which “affordable” invariably equates to “second rate”. Rather than

ABOVE AND BELOW Affordable luxury estates are a solution for many families and singles, giving them access to quality homes in their income bracket BOTTOM Selcourt Estate launched a show village in 2014, showcasing its luxury and estate homes. The variety makes Selcourt perfect for people wanting to climb the property ladder

building as many houses as possible in as little space as is economically feasible, Spies and his team have focused on aspects such as efficient energy usage, quality finishes, and the creation of surroundings that are not merely functional but conducive to healthy community development and leisure activities.

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Investing in a lifestyle Regarded as Cape Town’s premier tourist destination, the V&A Waterfront now offers a permanent stay as well By Michelle Marais Photographs courtesy of the V&A Waterfront

ABOVE David Green, Chief Executive Officer of the V&A Waterfront BELOW The historic Grain Silo is a phenomenal piece of industrial architecture, and one of the defining features of the V&A Waterfront OPPOSITE, FROM TOP Uninterrupted views at The Breakwater apartments; an artist’s rendering of the Zeitz MOCAA, soon to be another top attraction at the V&A Waterfront

n November 2014, Cape Town’s Victoria & Alfred Waterfront (V&A) was announced as the winner of the international award for Best Destination for Responsible Tourism at the World Travel Market in London. The award was granted in recognition of the tourism hot spot’s commitment and leadership in not only preserving the heritage of the property but also in its forward-thinking planning in terms of sustainable development. With the recent addition of the Watershed – a space housing more than 150 tenants who represent more than 365 brands, from ceramics and furniture to textiles, fashion and jewellery – the V&A has seen an increase in the total number of direct jobs created, growing from 16 155 in 2012 to 19 269 in 2014. As a result of the new attraction, the visitor numbers have grown to 24-million a year by end of 2014, and although it remains South Africa’s favourite tourist attraction for international visitors, they account for only 26% of all visitors. Visits by locals have increased to 58%. These impressive numbers are a clear indication that the V&A has established itself as more than just a tourist attraction. It truly has gained a reputation for being a lifestyle centre. Additionally, the public’s desire to indulge in this lifestyle has created a serious demand for affordable residential space. South African Property Review met with the V&A’s Chief Executive Officer David Green to

discuss development of affordable residential spaces, the impressive Zeitz Museum of Contemporary Art Africa (Zeitz MOCAA), and future plans for integrating the V&A seamlessly with the rest of the Mother City.

Q The Silo District developments – the first two which have already scooped top property and sustainability awards – are being completed in phases, and will host both commercial and residential spaces. Will these spaces cater exclusively for high-income individuals or will more affordable spaces be available to rent? All of our development is demand-led and the No.3 Silo residential spaces are meeting the strong and growing demand for high-end and high-quality residential offerings with strong green credentials. The No.3 Silo development will offer residential space in the form of 75 luxury oneto four-bedroom apartments, all offering the same environmentally sustainable benefits as the existing No.2 Silo development. The new No.3 Silo is aimed at predominantly local buyers who are looking for apartment living in an unparalleled setting. The apartments are of the highest standard of design and finish, and look to raise the standard of residential developments in the city. Currently, Ports Edge and The Breakwater are two of our more affordable rental residential options.

Q Starting at R6 500 per month, the Ports Edge apartments are considered to be more affordable. Will these apartments only be available for long-term rental or could potential investors buy property in the future? The Ports Edge apartments have proved to be very successful and are currently fully let. In addition, The Breakwater has recently opened for leasing and has opened for occupation to its first tenants on 1 March 2015. Apartments in The Breakwater are also considered relatively affordable, starting at R7 000 a month.

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By opening our ﬁrst rental developments, we have both increased the amount of property available for accommodation and diversiﬁed our accommodation offerings

Neither Ports Edge nor The Breakwater have options available to purchase because these developments have been specifically designed for rental occupation. However, there are a number of other developments at the V&A that are available to investors, such as the Marina development, No.2 Silo and our yet-to-be constructed No.3 Silo. Our intention is to create a vibrant, mixed-use property with sustainability credentials that will offer business opportunities, accommodation, lifestyle options and eateries – in short, a variety of offerings to suit a variety of needs. By opening our first rental developments, we have increased the amount of property available for accommodation and diversified our accommodation offerings. This is inherent in the V&A’s nature – as a mixed-use property throughout, it is known for a variety of offerings, which now extends to living space.

Q The development of the Zeitz MOCAA has caused a lot of excitement. What is the vision behind it, and what impact do you expect it to have on the V&A and Cape Town? BELOW The living area and kitchen of a two-bedroom apartment at Ports Edge

The Zeitz MOCAA is an ambitious project, being the largest museum to have been built

in Africa for more than 100 years. The vision is for it to harness the growing interest in contemporary African art – and where better to showcase these works than in Africa? The ultimate aim is to bring all of these works together to form the finest, largest collection of contemporary African art in existence. At the same time, we were reflecting on how best to repurpose the historic grain silos. They are a phenomenal piece of industrial architecture, and we wanted to find a way in which they could be accessible and displayed to the public. This is where the genius and magic of architect Thomas Heatherwick came into play, with his vision of how to best repurpose them. The redevelopment plan specifically aims to retain and honour the historic fabric and soul of the Grain Silo building, in which the Zeitz MOCAA will be housed, while transforming the interior into a unique, cutting-edge space to house the collection. We envisage that the impact when it opens in 2017, not only on the V&A but on the city as a whole, will be significant. It will be a major draw card for international visitors, and it will play an important part locally in telling the story of African art and culture.

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SAPOA events

Under construction S

outh Africa’s construction industry faced a challenging 2014, fraught with labour unrest, substantial delays in major construction projects and setbacks in the economy. SAPOA, in partnership with PwC, hosted a powerhour breakfast session to highlight the trends in the South African construction industry. The breakfast was presented by PwC Senior Audit Manager Deveshnee Naidoo, and attorney and conveyancer Gareth Shepperson of Shepperson Attorneys, SAPOA’s Regional Council Chairman for Gauteng. Based on PwC’s second publication of its SA Construction 2014: Highlighting Trends In The SA Construction Industry report (years to June 2014), Naidoo highlighted the key findings, including the fact that the

industry is in the news for the wrong reasons, especially in terms of the Competition Commission and large-scale project challenges and delays. Furthermore, there were unfulfilled promises after the potential in the previous year. “Revenue was up by nine percent but profits decreased by four percent,” said Naidoo. “The year 2014 saw construction and material companies lose one percent in market capitalisation.” She pointed out that public sector expenditure is also behind forecast. “The private sector is a significant player,” she said. Other trends highlighted at the breakfast included the global mining environment impact on demand; the energy sector’s great contribution in 2014; and the significant future need for energy in Africa.

“Longer-term commoditybased growth in Africa requires significant capital expenditure. There is also a great demand for buildings,” said Naidoo. Reflecting on the outlook, Naidoo highlighted that in the short term, the industry will continue to experience challenges with margins under pressure. “Profit warnings released by heavy construction companies at the end of 2014 are indicative of this,” she said. “In the long term, the infrastructure needs of South Africa and the African continent should support growth in the South African construction industry. In order for companies to be successful, they will need to develop their skills base and geographical diversification to take advantage of all these opportunities.”

SAPOA and PwC shed light on the South African construction industry at a recent breakfast session By Candace King Photographs by Erik Forster

ABOVE PwC Senior Audit Manager Deveshnee Naidoo TOP Deveshnee Naidoo with attorney and conveyancer Gareth Shepperson of Shepperson Attorneys, SAPOA’s Regional Council Chairman for Gauteng

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ENABLING NEW GENERATIONS OF

PROUD HOMEOWNERS Similan Consult is a company committed to engaging our analytical and creative skills as a property developer and development facilitator.

love. Others step up the property ladder within a development, buying “up" as their family needs - and household incomes - grow.

As a development facilitator, we offer valuable consultation aimed at guiding investors, financiers and other property developers on trajectories of great returns.

We believe that enabling people to own a home is wealth creation – in more ways than one. More than a decent roof over the head, owning a home in one of our estates brings far-reaching effects. It empowers families to create opportunities for their children: being able to loan money against the bond to send children to university for instance, or to start their own businesses. Such an investment unlocks many opportunities that would have been unattainable otherwise.

Preceded by our reputation for achieving consistent successes for astute property and investment professionals, we are regularly invited by banks and other financiers to consult with them as a critical part of the due diligence process. For these organisations we provide incisive feasibility and cash-flow studies. We prepare reports that give insight and steer them on the most appropriate course of action by determining the value chain and what the flow of activities should be. As a property developer, we live by our credo of “enabling new generations of proud homeowners”. In achieving this ideal, we contribute towards righting the wrongs of the past, particularly to redress previous inequalities of property ownership and education. To date, we have created opportunities for close on 1 000 families to own a home they can be proud of. Many of these clients are first-time buyers. Some rent homes in our estates, and then go on to purchase a home of their own in the community they have come to

Creativity is at the heart of everything we do. At Similan Consult, our creativity is made manifest in our design work. Not only the architectural design, but the planning and layout of the surroundings too. Rather than building as many houses as possible in as little space as is economically feasible, we focus on aspects such as efficient energy usage, quality finishes, and creating surroundings that are not merely functional, but conducive to healthy community development and leisure activities. Together with our architects and engineers, we consider what will attract people, how it will impact on the value of the property, how it will be to live in. That’s creativity at work.

info@similan.co.za Head office: 021 883 2433

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WE'VE CREATED AN UNLIKELY PAIR OF HOUSEMATES: AFFORDABILITY AND TOP QUALITY – Harold Spies, Developer KARINO LIFESTYLE ESTATE, NELSPRUIT CONCRETE PROOF THAT AFFORDABLE NEED NOT BE SUB-STANDARD

karino.co.za

At Karino Lifestyle Estate, challenging the status quo of affordable housing has paid off – not only for the more than 1 600 residents who already call this landmark estate home, but also for our development team: our innovation and commitment have been recognized by the South African Housing Foundation’s Housing Project of the Year Award in 2014.

SELCOURT ESTATE, SPRINGS AFFORDABLE LUXURY At Selcourt Estate, Similan Consult has bucked the trend and challenged the norm of shoddy-looking, hastily built, sub-standard entry-level housing that had become prevalent.

selcourtestate.co.za

It is at Selcourt Estate that our concept of “affordable luxury” first hit home. Unlike conventional affordable housing developments, the homes at Selcourt Estate are constructed in various designs and sizes, offering different exterior finishes such as multiple roof types and roof tile colours, a choice of wall colours, and quality fittings.

SUMMER RAIN PRIVATE ESTATE, NELSPRUIT A CHOICE OF SECURE LIFESTYLE OPTIONS Rising adjacent to Karino Lifestyle Estate, Summer Rain Private Estate is set to continue the successes of its popular predecessor by offering a choice of rental and purchase options to suit every lifestage and budget. summerrain.co.za

Generous park-like spaces have been planned, and the layout of the estate offers visual variation and aesthetic appeal created by differences in height, building designs and wall colours – a place that’s as comforting and welcome as the arrival of summer rain. SOUTH AFRICAN PROPERTY REVIEW

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The Cosmopolitan Hotel, Jeppestown, Johannesburg Once an opulent venue and favourite watering hole haunt of local residents, the Cosmopolitan Hotel is now a ghost structure, boarded up and waiting for revival Photographs by Candace King

he Cosmopolitan Hotel in Jeppestown, Johannesburg stands derelict. It was once a popular venue with a grand appearance and marvellous interior decor. Situated on Commissioner Street in the east part of the city, the building is now bricked up and looking quite forlorn. The date that appears on the building is 1899; however, because of the Anglo Boer War, the hotel was only completed in 1902. In light of this, the building’s style falls between two eras: it was designed in the Victorian era but built in the Edwardian. Designed by well-known architects at the time, brothers Arthur and Walter Reid (it’s the only surviving building designed by the

brothers), the hotel was initially owned by a Mr Schlom and was known as Schlom’s Hotel. It was then taken over by a Mr Lipson and subsequently by a Mr Cohen. In 1914, it was purchased by South African Breweries. The hotel was often frequented by miners from the Wolhuter Mine in the vicinity. It features an elaborate neo-baroque façade in the style known as “beaux-arts”. The bar features an exquisite row of supports of carved wooden lions in the classic heraldic style. Buffalo and buck heads are mounted on the walls – this recalls the time of the Masonic club known as the Old Buffaloes. In former times, the hotel was also called the Jeppe Rand Club by its patrons.

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NEED BETTER SPACE?

If you need less space, more space or just better space, contact Redefine Properties today. We have the place you need to work smarter. To view our portfolio, go to www.redefine.co.za or call 0860DEFINE.

OFFICE | INDUSTRIAL | RETAIL

We’re not landlords. We’re people. SOUTH AFRICAN PROPERTY REVIEW

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The return of CBD retail Traditional central business districts are getting a new lease on life with opportunities for the right kind of retailers to cater to diverse new markets By Andrew Fleming

ABOVE Rob Kane, Chairperson of the Cape Town Central City Improvement District BELOW Just before opening hours, outdoor seating in a pedestrian mall will soon fill up with city watchers (Photograph by Scott Arendse/CCID) BOTTOM RIGHT Tasso Evangelinos, Chief Operating Officer of the CCID

nternationally renowned urbanist Greg Clark – an adviser on the future of cities and their development – believes that “cities are densifying and becoming repopulated” and are beginning to “reverse the suburbanisation of the second half of the 20th century”. This he writes together with fellow urbanist Emily Moir in the study “The Business Of Cities”. The study notes that re-urbanisation is also seeing many offices and retailers moving their operations back to the city centre, particularly as workers themselves are opting for a lifestyle in a more densified urban environment where amenity hubs provide “restaurants, bars, coffee shops and public transport links all within easy reach”. “We’re certainly seeing this in the Cape Town CBD where, up until a decade ago, there were no more than about 750 residents in the area,” says Rob Kane, Chairperson of the Cape Town Central City Improvement District (CCID). “The latest census in 2011 confirmed a total of 5 286, and with the growing demand for residential properties, we believe this figure is already close to 6 000 – and that the next wave of development in the CBD will be to provide more residential units to satisfy demand.”

Expanding public transport infrastructure (in the form of the MyCiTi Bus Rapid Transit system) is also making it increasingly attractive for potential employers and their staff to consider the CBD as a location. “This bodes well for the local retail environment, which will not only need to service the growing daytime business population but a growing residential market – one that is currently not yet that well catered for,” says Kane. “At the start of the residential turnaround, about five years ago, we saw the downtown lifestyle favoured mostly by young professionals, and they’ve been relatively well catered for in terms of after-hours entertainment venues. Now we’re seeing the age group and needs of the residential community broadening, with the CBD becoming an option for everyone from young families with children and even pets, to those who are scaling down and opting for a more cosmopolitan, lock-up-and-go lifestyle. This expanding community is seeking amenities, products and services to meet its needs.” A recent survey conducted by the CCID revealed, for example, the need for more deli-type stores, retail that stays open after 5pm, and shops, restaurants and services that cater for children.

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themefeature leader “The CCID monitors retail activity in the CBD very closely in terms of the number and size of venues as well as the occupation rate,” says Tasso Evangelinos, Chief Operating Officer of the CCID. “The overall occupancy at the moment is a very encouraging 93%. We’re also seeing areas where shops are snapped up the moment they become available, and the emergence of nodes catering for specific customers, many of whom are seeking bespoke shops and not just large chain stores. We now have spaces catering for trendy, young fashion and decor customers, an increasing number of street markets, and public squares surrounded by eateries that cater for different tastes and pockets.” Innovative new sales and marketing techniques are also being embraced, of which the SnapScan smartphone payment system (which can pay for anything from lunch to parking) is proving to be very popular. “Many new office developments are also incorporating street-level retail, creating a plaza-type environment,” says Kane. “We’re heartened by this because it brings people out of office towers to street level, where they see for themselves that there’s a vibrant CBD out there with many things to enjoy.” The Central City is also seeing the emergence of new retail strategies, says Evangelinos. “Until relatively recently, many shopkeepers in the CBD concentrated just on the inside of their premises, without much effort given to the exterior and what could be done to attract passing trade,” he says. “More of them are now paying attention to pavement landscaping, tables and chairs in areas wide enough to accommodate these, and even the creation of parklets in parking bays. As the CCID, our urban management team is always on hand to advise retailers on these options, and we’re increasingly being called on to assist in terms of what the city’s bylaws will permit.” Other retail attractions include the provision of bicycle racks and even water bowls for pets. “We’re also seeing an increasing number of events being held in the CBD,” says Kane. “We would encourage retailers to be aware of these – and for those within the event footprint to consider opening their doors for trade. “All of this ties in well with the area’s transformation into a vibrant business and residential node, but also one in which the creation of wide pavements and bicycle lanes acknowledges the need for more sustainable transportation solutions while at the same time encouraging the retail environment to become part of the cityscape.”

FROM TOP The Earth Fair outdoor market in St George’s Mall; on the first Thursday of every month, CBD shops stay open after hours; food trucks have become part of the Cape Town CBD retail experience (Photograph by Carola Koblitz); eateries around Green Market Square take outdoor advantage of the passing trade (Photograph by Ed Suter)

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Going green with Dulux With the need to go green becoming ever more imperative, Dulux now offers sustainable products and solutions for a greener future

Leaders in providing sustainable paint solutions Dulux is the iconic brand from the world’s number-one paint company and leading colour authority AkzoNobel, a global Fortune 500 company with a passion for colour. AkzoNobel has long cemented its position as a global sustainability leader and tops the latest rankings in the materials industry group of the esteemed Dow Jones Sustainability Index. This esteemed first-place ranking, the company’s commitment and its consistent performance over the years are clear evidence of how sustainability has been successfully integrated into its operations in all parts of the world. In order to shape the paint market for the future, Dulux offers sustainable products and solutions that include a range of low-odour, low-VOC and green-label-certified products for environmentally conscious professionals. Green technology and sustainability are the way of the future, and Dulux is proud to be associated with more than half of all of South Africa’s Green Star-rated building projects. We work with professional architects, engineers, specifiers and contractors to ensure they “think green” when embarking on building projects.

Spotlight on 90 Grayston The ability to transcend simple functional needs with product solutions that address a growing list of sustainability, efficiency and even human resources considerations is what propelled Dulux to the preferred-paintpartner status on 90 Grayston. “As one of the most ecologically innovative developments in recent years, 90 Grayston demanded a paint solution that would not only meet the Green Star SA VOC limits, but that would also prove to match up to the high aesthetic value of the buildings,” says Dulux Trade ManagerJackie Lezar. “The Dulux EcoSure range provided a dynamic solution that not only addressed the Green Star requirements but also proved to offer the extensive choice in finishes and colour that a project of this architectural significance required.”

The sustainability ethos at Dulux is one that runs deep throughout the business, with a firm commitment to reducing the impact of its business activities at every stage of operations, from procurement and suppliers through to how it manages its long-standing client relationships. This commitment is underpinned by the global AkzoNobel “Planet Possible” drive, which guides and challenges Dulux to consistently outperform, innovate and rethink its operations. 90 Grayston proved to be the perfect manifestation of this ethos, says Lezar. “Our product performance contribution to the Green Star rating on 90 Grayston, and the partnership relationship we held with Redefine Properties and the architectural team at Grosskopff Lombart Huyberechts and Associates, made this project one of the stand-out projects for the Dulux Trade team. Collaboration will always prove to be a critical link between vision and delivery in any project of this scale, and this was certainly a key aspect for all stakeholders. We appreciate this forward-thinking relationship and strive to maintain a similar partnership with all our clients, rather than simply execute on order.” The wide range of Dulux decorative coatings includes interior and exterior emulsion, gloss enamel, wood and metal finishes, sealers, primers and undercoats. Specialty coatings such as silicone paints, flexible texture coatings as well as highperformance architectural coatings are also available for trade professionals. AkzoNobel has reinforced its position as a global leader in sustainability and recently launched a new concept that captures the essence of the company’s strategy to deliver more value from fewer resources. Planet Possible is designed to drive innovation and promote radical efficiency, and inspire and equip employees, customers and suppliers to realise new possibilities. It represents the next significant leap forward in the company’s ongoing journey to connect value creation with resource efficiency. For more information, visit Duluxtrade.co.za.

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people in profile

Ayanda Xintolo, Principal

ADX Projects cc Mechanical, Fire & Electrical Engineers

ADX Projects is a company specialising in mechanical and electrical consulting engineering for a variety of sectors. Founded in 2005 by engineer Ayanda Xintolo, ADX Projects has grown from strength to strength. While focusing on mechanical consulting, this dedicated firm has expanded to offer fire and electrical engineering solutions. It has continued to strive for greatness, following its aim to be one of the leading engineering consulting firms in the country and compete abroad. Throughout its lifespan as a 100% black-owned and managed firm, ADX Projects has repeatedly challenged itself with unusual and difficult projects. The staff have pushed themselves to design and plan varied projects, both large-scale and small. You can see their workmanship when you visit the Riverstone Mall in Swaziland, from the uninterrupted HVAC and the smooth lifts and escalators to the discreet but effective fire installations;

or if you visit the Ndwedwe Civic Centre in Ndwedwe, KwaZulu-Natal, where ADX Projects’ reputation for timeous service is well known. This exclusive, niche company is slowly making a name for itself in the industry. It will not be long before ADX Projects becomes the go-to name for projects throughout the country, with the size of the projects only getting bigger. The qualified engineers are experienced in delivering high-quality designs and service. Their combined experience of over 20 years ranges from retail, offices, hotel and leisure to industrial, educational facilities, hospitals, sports facilities and residential projects. The attention to detail is so high that any required drawings are rendered and produced in 3D for ease of service coordination. Knowing exactly what and how any installation will look and feel like is exactly what can ease any client’s mind about a project. While ADX Projects has its head office in Durban, it has grown to have representation in the Western Cape, Eastern Cape and Gauteng. Its offerings are diverse and extensive. The firm employs five youth engineers, two adult engineers, and two women (marketing and administration). Our service offering extends outside the South African borders. Thanks to the support from clients, ADX Projects has been able to compete in an extremely difficult market with wellestablished and experienced firms. The dedication and passion from the ADX Projects staff has enabled the firm to achieve the growth it has enjoyed over the years. Previous project involvement includes the Pavilion Shopping Centre, Ndwedwe Civic Centre, Denis Hurley Centre, Silverton Industrial Park, Jozini Community Health Centre and KZN Music House Recording Studios, Hytec Warehouse, UKZN Lecture Theatres and Riverstone Mall, among others. ADX Projects is able to offer clients the desired quality of service. The firm has experience in both greenfield projects and refurbishment projects.

Head office t: +27 (0)31 261 4917 c: +27 (0)82 339 3946 f: +27 (0)86 776 3945 ayandax@adxprojects.co.za admin@adxprojects.co.za www.adxprojects.co.za 52

Linda Xintolo, Associate

Service offering • Mechanical • Air conditioning • Fire protection • Smoke detection • Smoke control • Wet services • Kitchen equipment • Laundry equipment • Mortuary and refrigeration • Medical gases • Vertical transportation • Electrical: • Electrical reticulation and electronics • Project management: • Energy management and smart metering ADX Projects’ high reputation in the property industry has helped it thrive and become the industry competitor it is today. The company epitomises its motto: “Only the best will do.”

Celebrating 10 years of service

SOUTH AFRICAN PROPERTY REVIEW

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2015/03/09 3:47 PM

people in profile

BACK ROW, FROM LEFT Ian van Rooyen (Technical Director, Durban), Craig Sutherland (Managing Director), Michael Bennett (Technical Director, Johannesburg) FRONT ROW, FROM LEFT Jonathan Edwards (Director, Electrical Division), Thys de Vries (Director, Mechanical Division)

Sutherland Engineers (Pty) Ltd Multi-Disciplinary Engineers

When you talk about award-winning buildings in South Africa, a name that crops up frequently is Sutherland. Whether you are in Cape Town, admiring No.1 Silo at the Waterfront (winner of SAPOA Innovative Excellence Award for best building in the country in 2014), or in Johannesburg, enjoying the Cradlestone Mall in Krugersdorp (winner SAPOA Innovative Excellence Award for best Retail Centre in 2014), you can be confident that you are seeing the best of what this tightly knit company has to offer. These engineers have managed what may seem improbable: a passionate company that is very committed to thoroughly optimising all engineering aspects under their control while getting every tiny detail correct. Their growth is understandable. The early beginnings in 1991 as a structural engineering consultancy in the Western Cape started by the father-and-son team of Gordon and Craig Sutherland were the humble beginnings of a legacy. Sutherland is now a multi-disciplinary national conglomerate, with 100 staff members and four offices offering structural, civil, mechanical (HVAC, wet services and fire) and electrical engineering services. Sutherland’s innovative, well-thoughtout and effectively managed projects have left a mark on the national landscape. It has become so strong that this originally Cape Town-based company is making inroads into the African continent. Sutherland is active in nine sub-Saharan countries, with projects such as the Dar City mixed-use development in Tanzania; Akoshie mixed-use precinct in Accra, Ghana; The Hub retail mall in Kenya;

and even in Nigeria, with Bourdillon 50, a 16-storey apartment building, and Kings Tower, a 78m A-grade office tower. If that isn’t enough, Sutherland is an avid pursuer of Green Star status, with milestone projects such as No.1 Silo at the V&A Waterfront achieving a 6-Star Green Star Design and As Built status. Sutherland is a member of the Green Building Council, and is also a Platinum Sponsor of the

Young Africa Publishing green office fit-out (Earthworks Magazine). This well-rounded engineering company is also ensuring that the next generation of engineers is getting the right real-world training: Sutherland opened the Sutherland Draughting and Detailing Academy in 2008 for in-house, staff-run training in technical engineering, draughting and detailing. The company is clearly doing something right because this academy won the Prime Media Achiever Award for the best training programme and achieved national accreditedtraining-provider status. It goes further: the company substantially supports the Go for Gold Programme, which supports, trains and gives bursaries to Grade 11 and Grade 12 pupils from previously disadvantaged areas in Cape Town. To date, 400 kids have benefited from this programme. All of these accomplishments are in keeping with long-term expansions of Sutherland’s principal philosophies. Superior engineering, innovative and proactive planning, technologically cutting-edge solutions and personal hands-on attention to all clients are vital to staying the best. This passion and drive is summarised by the Sutherland motto, “optimal engineering”.

The Zeitz MOCAA at the V&A Waterfront is currently under construction

Johannesburg: +27 (0)21 425 0065 Tyger Valley: +27 (0)21 425 0065 Cape Town: +27 (0)21 425 0065

Durban: +27 (0)21 425 0065 info@sutherlandengineers.com www.sutherlandengineers.com SOUTH AFRICAN PROPERTY REVIEW

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2015/03/11 11:28 AM

people in profile

Howard Davey

Filipe Vinagre

Faizal Ally

Director

Solutions for Elevating (Pty) Ltd

Howard Davey is a seasoned businessman, with a BCom from the University of the Witwatersrand and an MBA from Henley Business College. In 2010 he formed Solutions for Elevating (Pty) Ltd, partnering with Filipe Vinagre. “I saw the need for a high-quality, neutral, independent consultancy in the lift industry, so I created that with the best people I could find to work with,” he says. “In the consulting world you need to be on top of your game. Keeping abreast of the latest technologies is vital – and this requires that, in addition to interaction with local suppliers, we constantly update our knowledge through annual visits to R&D facilities and international expos. It also involves keeping up to date with changes in local and international regulations. Our primary focus is to provide innovative solutions – we see ourselves as independent managers and advisers on maintenance delivery.” Davey maintains that, in general, when things are going well lifts and escalators do not seem critical to a building’s performance. “But when it malfunctions, vertical transportation will damage user perceptions of the property,” he says. “It affects the psychological image a customer has of the property brand because it implies that maintenance and safety are not treated as priorities”. Recently, S4E has become one of the few accredited lift inspection bodies registered with the Department of Labour. “We’re proud of our reputation for delivering quality service and achieving preferred consultancy status with high-end property groups.”

In his long career, Filipe Vinagre, Director at Solutions for Elevating (Pty) Ltd, has managed to work his way up from a lift-technician apprentice in 1981 to field-engineering manager and beyond, choosing to grow – and clearly thrive – at Otis (Pty) Ltd. In 2010, he co-founded S4E with Howard Davey. “I love my work: I have every opportunity to turn challenges into opportunities; I need to balance budget, space constraints, traffic analysis and all sorts of other issues in order to decide what type of lift is needed,” he says. “Over the years, we have become more involved with the big projects, which have unique problems. For example, the 90 Grayston building in Sandton has received a 4-Star Green Building rating but planning for lifts in a green building is difficult. My favourite personal challenge is the Grain Silo Complex at the V&A Waterfront in Cape Town. The revolutionary design of the building requires highly flexible thinking by everyone involved, just to work around the tubular spaces.” With his qualification from the University of Pretoria, Vinagre tends to go the extra mile with every project. He maintains that honesty and integrity are essential when dealing with a client. “Any small glitch can throw a project off course – which is why we track every detail from planning to the opening of the building,” he says. “We will always stand by our work and be a part of the solution needed by a client.”

During a 32-year career at Otis (Pty) Ltd, Faizal Ally worked his way up to Managing Director. After a very rewarding time at the company, he joined S4E as a Director in 2014. “Being a consultant allows you to help the client and the service provider,” he says. “The client gets the best advice on products, budgets, potential risks and access to the latest industry technology. The service provider gets access to a broad, up-todate knowledge base, where information, improvements in technology, techniques and management ideas are shared. This is vital because for a number of years the elevator/escalator sector has suffered a brain drain as a result of to retirement and emigration. This affects the aging technology – younger engineers have only theoretical knowledge and must upgrade elevators to comply with the latest safety regulations. Up-skilling technicians on the job, transferring skills and deepening their knowledge base are all vital for the future success of the commercial property sector.“ With his engineering qualification from Pretoria Technikon (now Tshwane University of Technology) and an MBA, Ally considers the move to S4E an exciting new phase in his career – and an opportunity to be involved with S4E in the contract for 90 Grayston in Sandton, the flagship office development for Redefine Properties. He believes that what makes S4E different is the company’s emphasis on strong, skilled senior management that is constantly re-evaluating processes and incorporating new developments in the industry.

CONSULTANTS IN LIFTS t: +27 (0)86 122 2556 howard@s4e.co.za www.s4e.co.za 54

ESCALATORS & HOISTS f: +27 (0)11 234 2899 filipe@s4e.co.za www.s4e.co.za

t: +27 (0)86 122 2556 faizal@s4e.co.za www.s4e.co.za

SOUTH AFRICAN PROPERTY REVIEW

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2015/03/09 4:16 PM

people in profile

Howard Betts

Mike O’Grady

Sybrand Strauss

Managing Director

Director

Managing Director

Betts Townsend (Pty) Ltd

Fernridge Consulting (Pty) Ltd

Howard Betts, Managing Director at Betts Townsend (Pty) Ltd, says that starting at W&C French (Pty) Ltd at the age of 17 and staying in the construction business all these years has made him into the project manager that he is today. His lengthy career has exposed him to all facets of construction, which has never deterred him – hence the Betts Townsend motto of “It can be done”. Betts’s extensive travelling has allowed him to experience a wide variety of cultures and circumstances. When he finally decided to start his own company in 1995, he had a handful of people and a garage for an office. This has now grown to a staff of 48 very talented people, with offices in Johannesburg, Cape Town, Durban, Mauritius and Kenya. Betts says that, in the beginning, there were maybe eight companies doing project management in the construction sector. Now there are more than 30, so competition is fierce. “Our strong networking skills keep us ahead of the game,” says Betts. “When we work on a project, the focus is on using the right people and keeping the balance. When you are surrounded by a team of professionals, only good things can happen.” The “it can be done” motto has paid off with numerous repeat customers, a level 3 BEE rating, and a 20-year anniversary in February 2015 this year. Betts maintains that his proudest moment was when his fresh, young staff became directors, bringing new knowledge to the well-established company.

Mike O’Grady was born and raised in Durban, and qualified as a quantity surveyor, with a BSc from the University of KwaZulu-Natal. His interest for project management was piqued when he worked for a sister company in the United Kingdom in 1995. After a number of major construction projects in countries such as Tanzania, Mozambique, Botswana, the UK and the UAE, he returned home. To supplement his training and experience, he achieved an MBA through the Gordon Institute of Business Science in 2002. Today, he is working on the R500-million 90 Grayson Drive project on behalf of a repeat client, Redefine Properties in Sandton. “On a project as big as this, maintaining balance is key,” says O’Grady. “You need to start, while being aware that almost anything can throw off the schedule, from issues with plan approval to labour strikes. When we were hit with 15 days of strike action, the longest known in the construction sector, it was just another challenge, which we met with zeal in order to finish on time. This makes it all the more worthwhile because this is where the talent for managing people is essential. The ability to read emotions and set up friendly collaboration, even in adverse conditions, is what Betts Townsend is all about.” O’Grady maintains this, together with the company’s strong reputation, has kept it ahead of its competitors. Betts Townsend keeps to its motto in all aspects of their business.

Whether it was attaining his BSc (Hons) degree in Urban Geography or diving straight into work as a GIS analyst fresh out of the University of the Free State, Sybrand Strauss always followed his passion and thrived. As the founder and Managing Director of Fernridge Consulting, his main focus is to oversee the business – but he is also actively involved with the research team as an expert in the property development space. Strauss is also well-positioned in the industry as a thought leader, and plays a vital role at most of the conferences and research councils. Along with the rest of the team, who also have a background in geography, Strauss brings people and urban planning together. “What is always vital with commercial (especially retail) properties is the need for accurate, reliable, up-to-date information on the area in which you intend to build,” he says. “If you get the right information long before you get to the building stage, then you are better positioned for success. This is particularly true in Africa, where area demographics, retail expenditures or even accurate population numbers are hard to come by. That is why we pride ourselves on getting that information, even to the point of gathering it ourselves with aerial photography. We have created the online tool Africa Eye to provide the public with access to our data.” Strauss attributes his success to the fact that he has remained humble and that he never does business that could compromise his core values.

t: +27 (0)11 656 2440 ddunkley@btpm.co.za www.bettstownsend.co.za

t: +27 (0)11 583 0900 sybrand@fernridge.co.za www.fernridge.co.za / www.africaeye.co.za SOUTH AFRICAN PROPERTY REVIEW

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2015/03/09 4:17 PM

people in proﬁle

JOHANNESBURG +27 (0)11 223 6800 10 Woodmead Estate, 1 Woodmead Drive, Woodmead Station CAPE TOWN +27 (0)21 511 3040 Parklane Block B, 3rd Floor, cnr Alexander & Park Roads, Pinelands 7405 DURBAN +27 (0)31 583 4260 38 Rydall Vale Park, Douglas Saunders Drive, La Lucia Ridge

Strength Integrity Passion VISION

Our vision is to consistently build on our reputation for being the most unique, cutting-edge construction project management organisation which services Clients with clear goals and positive attitude, delivering an unparalleled quality of service, with smart, innovative solutions sustaining our position as leaders in the industry.

www.sippm.co.za 56

people in proﬁle

Andre van Huyssteen

Sheerish Jhina

Director

SIP Project Managers (Pty) Ltd

Born and raised in Pretoria, Andre van Huyssteen is living proof that nothing can stop a person from achieving their goals. A University of Pretoria graduate with a BSc in construction management, he dove into the deep end with SIP Project Managers (Pty) Ltd in 2003. Van Huyssteen immediately went off to Dubai in the United Arab Emirates to work on the Madinat Jumeirah Resort – and hit the ground running. He spent eight years in Dubai on prestigious hospitality projects, followed by two years in Vietnam on the Grand Hotel Resort and Casino. “Getting exposed to so many large-scale luxury projects was a great experience for me,” he says. “I have spent 10 years abroad for SIP Project Managers on some of Dubai’s landmark projects before relocating back to South Africa. What I have learnt is that teamwork is essential in order for things to go smoothly.” SIP Project Managers has been an innovator and a leader in the projectmanagement industry for more than 36 years. This has been made possible by striving to be on the cutting edge – in South Africa and abroad – in the field of construction project management. The firm’s philosophy has always been to strive for excellence with strength, integrity and passion. “Our drive to make things happen and our ability to deliver and achieve our clients’ goals and expectations form a part of SIP Projects Managers’ business philosophy,” says Van Huyssteen.

When you find the ideal company, things fall into place. With an ambition to build buildings 18 years ago, Sheerish Jhina found that with SIP Project Managers (Pty) Ltd. He is a graduate of the former Technikon Witwatersrand with a diploma in quantity surveying. “Performing a balancing act is what I – and SIP Project Managers – excel at,” he says. “Keeping the client’s expectations between the brief and the budget on target takes a skilled intermediary. This often necessitates that you operate beyond your boundaries in development and construction management to get the job done.” The drive to make things happen and covering the entire spectrum of challenges is what has forged SIP Project Managers through 37 years of experience in complex, specialised and large-scale projects. The professionalism found in the company puts it ahead of its competitors – and it fills Jhina with pride. Some of his more iconic achievements are reducing a mountain to then build Sibaya Casino & Hotel, The Pearls of Umhlanga high-rise and (most memorably) the construction management of the entrainment centre at Ceasars Gauteng, with an indoor roller coaster and the cars and aircraft suspended from the roof (introduced at a late stage of the project). “I love working at SIP Project Managers,” says Jhina. “In the 10 years that I have been a director, I have been a part of some great projects. In the future, I’m sure our ethos of personal responsibility and extraordinary effort will not change – and it will drive us to even greater heights.”

t: +27 (0)11 233 6800 andre@sippm.co.za www.sippm.co.za

t: +27 (0)11 233 6800 sheerish@sippm.co.za www.sippm.co.za

SOUTH AFRICAN PROPERTY REVIEW

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2015/03/11 1:04 PM

people in proﬁle

Nyameko Magongo

Mphoto Thabane

Director

SIP Project Managers (Pty) Ltd

Nyameko Magongo, Director at SIP Project Managers (Pty) Ltd, is a determined man. He took every chance that was presented to him. Even as a matriculant, he clearly saw an opportunity in the commercial property sector, particularly in construction. This is why he graduated with a BTech in quantity surveying from the then Port Elizabeth Tehnikon in 1998. In 1999, he was given opportunity to manage a project for Sun International: the Boardwalk Casino and Entertainment World. This was his first professional, independent job as a project manager. As luck would have it, SIP Project Managers was a joint partner in the venture. When Magongo officially joined SIP Project Managers as a director in 2012, he found that his personal philosophy on personality management fitted in perfectly with the company. “Because project management is reliant on people, a project manager needs to be adept at managing personalities,” he says. “You need to pre-empt issues before they become a problem.” SIP Project Managers reached high acclaim with the Portside building for FNB and Old Mutual in Cape Town. Not only is it the tallest building in Cape Town, it was also awarded a 5-star rating for Green Design (2013) and for As Built (2015) by the Green Building Council of South Africa. “I am proud that the first project that I managed as an SIP project manager has received such high accolades,” says Magongo. “We will always strive to be known for such quality and esteem.”

Mphoto Thabane graduated with a BSc in civil engineering from the University of Cape Town and joined SIP Project Managers in 2008 after working as a civil engineer for two years. He was drawn to SIP Project Managers based on the company’s extensive and impressive project management experience, and its stature in the construction and commercial property industry. SIP Project Managers is one of the leading project management consultancies in South Africa, and has made frequent ventures into international waters. Thabane was a part of those ventures with the Queen Mamohato Memorial Hospital in Lesotho. This project was completed in 2011, and it gave Mphoto the platform to give back to his home country. He says that passion is vital for working at SIP Project Managers: “As project managers, we always go beyond the call of duty to ensure our projects are delivered on time, within budget and to the specified quality.” He is part of the project management team working on the Nelson Mandela Children’s Hospital, which is currently under construction in Parktown in Johannesburg. Thabane has stated that even though there’s been a slow upturn to the amount of construction projects post the 2008/2009 recession, SIP Project Managers has managed to weather the storm because of its strong reputation for offering a high-calibre project management service, strong integrity, and resourcing each project adequately with the right staff complement. “Our motto is in our name: strength, integrity and passion. That’s what drives us.”

t: +27 (0)11 233 6800 nyameko@sippm.co.za www.sippm.co.za

t: +27 (0)11 233 6800 mphoto@sippm.co.za www.sippm.co.za

people in proﬁle

Strength Integrity Passion MISSION

Our mission is to continue to provide superior-quality professional services, giving clients the confidence that their needs will be consistently met through reliable delivery of their expectations, utilising our combined experience, knowledge and expertise developed over 36 years.

www.sippm.co.za SOUTH AFRICAN PROPERTY REVIEW

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2015/03/11 1:05 PM

advertorial

Engineering excellence CKR Consulting Engineers is a multidisciplinary engineering services company with a national footprint

perating from offices in Johannesburg, Pretoria, Cape Town and Durban, CKR has successfully completed numerous projects in Africa and the Middle East. CKR Consulting Engineers offers its clients a full range of consulting engineering services such as electrical, electronic, IT, mechanical (HVAC), lift, fire and wet services. CKR has established a specialiased IT division (CKR IT Consulting) to cater for the specific needs of property developers by providing IT infrastructure for commercial, hospitality, entertainment, residential and retail projects. CKR IT Consulting helps its clients with the integration of all IT services into a converged platform. • Data centres – designed either to cater for a single tenant, co-location or combined services such as business critical servers and applications for the entire building. • Server rooms • Building management systems (BMS) – centralised, interlinked networks of hardware and software that monitor and control the environment in commercial, industrial and retail facilities. BMS manages the various building systems and the automation system ensures the operational performance of the facility as well as the comfort and safety of the building’s occupants. BMS can be integrated with WiFi services and controls the following: • Access control • Lighting • Smart thermostats (A/C) • Façade lighting

•

Generator and bulk diesel storage monitoring • Environmental controls for IT facilities Converged fibre optic networks – a tripleplay network providing voice, video and data connectivity within the development across a single infrastructure network. The network can be used to deliver all forms of communication services and satellite TV feeds, allowing for better services at a lower cost, with an access to a wider range of options and a choice of service providers. All data, voice, TV and security services can be linked to this single infrastructure source. Interactive “smart” development – an integrated solution allowing the user to interact with the development. Strategically placed WiFi devices enable visitors to use their smartphones as a way-finder to various tenants, shops, offices, banks, activities and available parking. This can all be achieved by utilising specialised mobile applications designed for the development. Digital media – advertising content, live TV, news feeds and conferencing can be displayed and arranged on screens according to location, demographics, venue and time of day. Digital signage and information can be displayed from one centralised control point.

CKR IT Consulting provides its services to international clients such IBM, Mediclinic, Group Five, Schneider Electric and Neotel. We pride ourselves on always finding the right solution to meet our clients’ specific needs and requirements.

t: +27 (0)11 217 7300 f: +27 (0)11 217 7335 e: office@ckr.co.za The Oval, Ground Floor, East Block Wanderers Office Park, 52 Corlett Drive, Illovo, South Africa www.ckr.co.za 58

SOUTH AFRICAN PROPERTY REVIEW

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statistics

What’s trending in Johannesburg and Cape Town Through its recently released Q4 2014 research reports, JLL South Africa places a spotlight on the Johannesburg and Cape Town property market

he JLL South Africa research team has released its Q4 2014 research reports for the Johannesburg office and industrial market, and the Cape Town office market. In the Johannesburg office market, demand was muted under the prevailing uncertainty in the economy, leaving rental rates largely unchanged over the period. Taking prices as a guideline, it is evident that the office market remains under pressure, with an abundant supply and prices still at 2013 levels in contrast to rising operational costs. The economy continues to show signs of fragility and vacancies are expected to remain high, with rental rates remaining muted. Industrial space in Johannesburg saw a rise in the quarter despite the poor performance of the local manufacturing sector in 2014. This can be attributed to increased activity in logistics and distribution. Rental rates remained largely unchanged over the period. Maxi-units have gained appeal because of their efficiency in storage and operational costs, contributing to a flat trend in rental rates in this regard. Despite challenging conditions, the Cape Town office market continued to show stability in the quarter. The CBD and Century City showed the highest growth in Grade A rentals. Few, if any, speculative developments are anticipated in present market conditions – but these conditions present excellent opportunities for tenants, who are being offered attractive lease terms by landlords.

Key findings •

• •

The Johannesburg oﬃce market demand remained muted under the prevailing uncertainty in the economy, leaving rental rates largely unchanged during this time. The Cape Town oﬃce market continued to show stability in Q4 2014 despite challenging conditions. Despite the dismal performance of the local manufacturing sector during 2014, industrial space in Johannesburg has been on the rise because of increased activity in logistics and distribution.

Table 1: Johannesburg office market outlook Summary statistics

Q4 2013

Q4 2014

Prime gross rent (R/m per month)*

220

210

-4,5%

Prime yield (%)

8,25

8,5

+25bps

Overall Johannesburg vacancies (%)

12,2

11,3

+90bps

Johannesburg city centre vacancies (%)

18,3

13,5

-470bps

Grade P vacancies (%)

9,1

11,5

+240bps

8 580

9 436

+10%

Development pipeline (000m )

535 773

570 620

+6,5%

Completions (m2)

67 000

53 335

-20,4%

Total gross leasable area (GLA) (000m ) 2

Change (y-o-y) 12-month outlook

Source: JLL South Africa Q4 2014 research reports – Johannesburg Ofﬁce Market Outlook

Table 2: Johannesburg industrial market outlook Summary statistics

Q4 2013

Q4 2014

Prime gross rent (R/m per month)*

+5,2

Prime yield (%)

8,25

8,5

+25bps

93 891

112 323

+19,6%

4,5%

5,5%

+100bps

181 336

38 200

-79%

98 500

447 000

354%

4 296

4 453

+3,6%

Take-up (m ) 2

Vacancies (%) Completions (m ) 2

Development pipeline (m ) 2

Total gross leasable area (GLA) (000m ) 2

Change (y-o-y) 12-month outlook

Source: JLL South Africa Q4 2014 research reports – Johannesburg Industrial Market Outlook

Table 3: Cape Town office market outlook Summary statistics

Q4 2013

Q4 2014

Prime gross rent (R/m2 per month)*

165

Overall Cape Town vacancies (%)

11,3

-140bps

Cape Town CBD (%)

14,4

13,1

-90bps

Grade A vacancies (%)

7,1

6,5

-60bps

2 368

2 429

+2,6%

116 000

43 000

-62,9%

7 000

16 500

136%

Total gross leasable area (GLA) (000m2) Development pipeline (000m2) Completions (m2)

Change (y-o-y) 12-month outlook

Source: JLL South Africa Q4 2014 research reports – Cape Town Office Market Outlook * Prime rent represents the top open market rent that could be expected for an office unit of the highest quality and specification in the best location in a market, as at a survey date SOUTH AFRICAN PROPERTY REVIEW

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whatâ&#x20AC;&#x2122;s on

April Region

Date

Event

Port Elizabeth

10 April 2015

Heritage in Nelson Mandela Bay

Mpumalanga

10 April 2015

Lease Agreement Workshop

KwaZulu-Natal

13 April 2015

SPLUMA Breakfast Session

Port Elizabeth

15 April 2015

Regional Meeting

Gauteng

16 April 2015

SAPOA Human Resources/Board Meeting

East London

16 April 2015

Networking Event

Limpopo

17 April 2015

Golf Day

Gauteng

17 April 2015

Building Partnerships for Economic Development

KwaZulu-Natal

17 April 2015

Breakfast Session

Lowveld

23 April 2015

Business Breakfast

May Region

Date

Event

Western Cape

6 May 2015

SANS 100400 Workshop

TBC

7 May 2015

SAPOA National Council

Gauteng

13 May 2015

Research Breakfast: Operating Costs Report

East London

14 May 2015

AGM/Eskom Breakfast Presentation

KwaZulu-Natal

19 to 21 May 2015

SAPOA Annual Convention

TBC

20 May 2015

British Council of Offices

KwaZulu-Natal

20 May 2015

SAPOA AGM at Convention

KwaZulu-Natal

20 May 2015

Board Meeting

Gauteng

26 May 2015

Legal Breakfast

Gauteng

28 May 2015

Networking Event

Mpumalanga

29 May 2015

Networking Event

Gauteng

30 May 2015

PWC Half-Day Workshop

June Region

Date

Event

Western Cape

4 June 2015

Green Building Breakfast Session

Gauteng

9 June 2015

Research Breakfast

Gauteng

11 June 2015

Networking Event

KwaZulu-Natal

12 June 2015

Breakfast Presentation

TBC

13 June 2015

Protection of Personal Information

Port Elizabeth

17 June 2015

Regional Meeting

East London

23 to 25 June 2015

ICPP

KwaZulu-Natal

25 June 2015

Golf Day

USA

28 to 30 June 2015

BOMA International Conference

July Region

Date

Event

Gauteng

2 July 2015

Negotiation Skills Masterclass Programme

Mpumalanga

3 July 2015

Networking Event

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whatâ&#x20AC;&#x2122;s on

Events and dates subject to change.

July Region

Date

Event

Gauteng

7 July 2015

Introduction to Brokering Seminar

Gauteng

15 July 2015

Regional Meeting

East London

23 July 2015

Networking Event

Gauteng

23 July 2015

Legal Breakfast

Gauteng

28 July 2015

Golf Day

KwaZulu-Natal

31 July 2015

Breakfast Presentation

August Region

Date

Event

Gauteng

4 August 2015

Research Breakfast

Gauteng

6 August 2015

SAPOA Audit Risk Meeting

Gauteng

11 August 2015

PWC Breakfast

KwaZulu-Natal

11, 12 and 14 August 2015

ECPP Training

Polokwane

12 August 2015

Breakfast: Town Planning Scheme

Polokwane

12 August 2015

Breakfast Session

Gauteng

13 August 2015

Lease Agreement Workshop

East London

14 August 2015

Golf Day

Gauteng

14 August 2015

PWC Power Hour Breakfast

Gauteng

17 to 21 August 2015

FMP Training

East London

19 August 2015

Introduction to Brokering Seminar

Port Elizabeth

19 August 2015

Regional Meeting

TBC

20 August 2015

Introduction to Brokering Seminar

Gauteng

20 August 2015

SAPOA HR Meeting

Mpumalanga

20 August 2015

Networking Breakfast

TBC

20 August 2015

SAPOA Board Meeting

25 August 2015

Golf Day

Gauteng

25 to 28 August 2015

ECC Training

Gauteng

27 August 2015

Networking Event

Gauteng

28 August 2015

MOMFA

KwaZulu-Natal

Events and dates subject to change.

September Region

Date

Event

Port Elizabeth

1 to 3 September 2015

ICPP Training

KwaZulu-Natal

3 September 2015

Negotiation Skills Masterclass Programme

Gauteng

7 and 8 September 2015

ICPP Training

TBC

7 to 11 September 2015

ECPP Training

Port Elizabeth

8 September 2015

Golf Day

Western Cape

8 to 11 September 2015

ECPP Training

Polokwane

10 September 2015

SANS 10400 Workshop

Gauteng

15 September 2015

Retail Trends Report Breakfast

Port Elizabeth

16 September 2015

Council Meeting

Port Elizabeth

17 September 2015

Networking Event SOUTH AFRICAN PROPERTY REVIEW

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whatâ&#x20AC;&#x2122;s on September Region

Date

Event

Mpumalanga

17 September 2015

Golf Day

TBC

17 and 18 September 2015

National Council Meeting

Port Elizabeth

22 September 2015

Golf Day

Mpumalanga

23 September 2015

Networking Dinner

Western Cape

26 September 2015

Property Development Workshop

Gauteng

28 to 30 September 2015

IPMP Training

Gauteng

29 September 2015

Legal Breakfast

KwaZulu-Natal

29 September 2015

SANS 10400 Workshop

KwaZulu-Natal

30 September 2015

SACSC Annual Congress

October Region

Date

Event

Gauteng

1 and 2 October 2015

IPMP Training

Western Cape

6 to 8 October 2015

ICPP Training

Gauteng

7 October 2015

Media Lunch

Gauteng

8 October 2015

Legal Breakfast

Polokwane

15 October 2015

Golf Day

KwaZulu-Natal

15 October 2015

Breakfast Presentation

Gauteng

17 October 2015

Research Breakfast: Industrial Industry Report

Gauteng

20 October 2015

Industrial Vacancy Report Breakfast

KwaZulu-Natal

23 October 2015

Networking Breakfast

Gauteng

23 October 2015

Brokers Economic Update

Gauteng

26 to 30 October 2015

BCTP Training

Port Elizabeth

29 October 2015

Gala Dinner

November Region

Date

Event

Gauteng

4 November 2015

ECPP Training Course

TBC

5 November 2015

SAPOA Board Meeting

Gauteng

6 November 2015

Legal Power Hour

TBC

10 November 2015

Research Breakfast

KwaZulu-Natal

11 November 2015

Gala Dinner

Gauteng

11 November 2015

Negotiation Skills Masterclass Programme

Gauteng

12 November 2015

Networking Event

TBC

13 November 2015

Networking Evening

Gauteng

16 to 20 November 2015

FMP Training

Gauteng

17 November 2015

FM and IAMP Training Courses

Port Elizabeth

18 November 2015

Council Meeting

KwaZulu-Natal

19 November 2015

Gala Dinner

Polokwane

20 November 2015

Council Meeting

Gauteng

20 November 2015

Brokers and Legal Update

Western Cape

21 November 2015

Property Development Workshop

Mpumalanga

25 November 2015

Gala Dinner

Polokwane

26 November 2015

Gala Dinner

Gauteng

27 November 2015

PWC Half-Day Workshop

Port Elizabeth

29 November 2015

Gala Dinner

December Region Buffalo City

Date 3 December 2015

Event Developersâ&#x20AC;&#x2122; Gala Dinner

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people in profile

www.sapoa.org.za-research

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off the wall

Mars’s new Martians In 2024, 100 humans will venture into space to settle on Mars – the next giant leap for mankind is almost here By Candace King

Five South Africans are in the running to be among the 100 candidates: Adriana Marais and Divashen Govender of KwaZuluNatal, Kobus Vermeulen of Gauteng and two others, known only as Edwin and Alexandra, may be the chosen locals to mission to Mars in 2024

An artist’s impression of a future Mars One colony. Image: Bryan Versteeg/Mars One

t’s now a reality – Earth’s “colonisation” of the red planet, Mars. The fourth planet from the sun and the second-smallest planet in the solar system, Mars will become the new home of 100 lucky candidates (50 men and 50 women) who will take a one-way trip to the planet, where they will live and work as its new inhabitants. Mars One, the not-for-profit foundation, will establish a permanent human settlement on Mars. Crews of four will depart every two years, starting in 2024. The first unmanned mission will be launched in 2018. According to its website, the Mars One mission plan consists of cargo missions and unmanned preparation of a habitable settlement, followed by human landings. In the coming years, a demonstration mission, communication satellites, two rovers and cargo missions will be sent to Mars. These will set up the outpost where the human crew will live and work. The mission design takes into account the expansion of the human colony, with a new crew arriving every two years. A global search is currently under way to find the first humans who will make

Mars their home. During extensive training, candidates will learn the skills they will need on Mars and on their journey there. The combined skills set of the astronaut team members will cover a very wide range of disciplines. More than 200 000 men and women from around the world responded to the first call for astronauts. Five South Africans are in the running to be among the 100 candidates: Adriana Marais and Divashen Govender of KwaZulu-Natal, Kobus Vermeulen of Gauteng and two others, known only as Edwin and Alexandra, may be the chosen locals to mission to Mars in 2024. With the prospect of people living on Mars, the possibility for property development poses even more excitement. Imagine a megamall on Mars, or office blocks or a hi-tech industrial warehouse… The idea is not without appeal. Perhaps in time, property companies will be speaking about expanding their portfolio footprint to Mars. What would the land legislation stipulate? So many questions … and only time will answer them.

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from the CEO

AFRICA’S FIRST GREEN CITY

BROUGHT TO YOU BY WSP.

Menlyn Maine is being dubbed as Africa’s first green city – striving to stimulate a paradigm shift in how South Africans live, work and play through the single biggest development project in Pretoria. It was with this philosophy in mind, and given our solid reputation for innovation and expertise in structural and civil engineering as well as sustainability that WSP has been a key partner to bringing this vision to life. As one of the largest engineering consultancies in Africa, WSP plays an important role in our country’s sustainable development. We aim to future proof our projects, helping our clients to achieve their sustainable development goals and approaching everything we do with passion and caring.

31,500

500

EMPLOYEES

OFFICES

COUNTRIES

www.wspgroup.com Image courtesy of Boogertman + Partners Architects.

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people in proﬁle

Proactive Quantity Surveying 3

1 Head office for Ecobank in Accra, Ghana. Architects: Arc Architects 2 West Hills Mall in Accra, Ghana for a subsidiary of Atterbury Properties. Architects: Arc Architects 3 Student accommodation in Pretoria for the Feenstra Group. Architects: Boogertman + Partners 4 Vdara Office Park in Johannesburg for Bakos Brothers. Architects: Integrale Architectural Design

Our track record speaks for itself. DelQS was established in 2000 and has since built up a remarkable track record. We have provided quantity surveying services for almost all building types ranging in construction cost from relatively small to multi-billion Rand developments. Building and property economics is a specialty.

QUANTITY SURVEYING

Gerhard de Leeuw

Akopo Africa

Nico Roos

Dr Corné de Leeuw

DISPUTE RESOLUTION

PROPERTY VALUATION

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