South African Property Review November 2016 by SAPOA

South African Property Review

PROPERTY SOUTH AFRICAN

November 2016

REVIEW

PROPERTY REVIEW - LogoTreatment.pdf

Environment, green and sustainability

H2O Water restrictions a reality?

2016/08/25

11:31 AM

Blowing in the wind

Adding new energy technology to the mix

Going green How green is your building?

s●

series D L

Airports leading the way

●

monthly cou n Our

Th e WOR

Solar energy

by-country focu try-

November 2016

Nordic delights Focus on Norway

SAPOA events

YOU FOCUS ON WORK, WE’LL DO THE REST Our Facilities Management team is dedicated to providing the safest, most efficient, and cost-effective work environments. That’s why some of the largest, and most successful, corporations in the world trust us with the management and operation of their facilities. We are an extension of our client’s organisation. We add value because of our personnel’s experience and industry knowledge, and the use of cutting-edge technology. We work with you to understand your operating philosophy. Our services improve operating efficiencies across your entire portfolio.

Johannesburg +27 11 911 8000 cwexcellerate.com An independently owned and operated affiliate of Cushman & Wakefield

SOUTH AFRICAN PROPERTY REVIEW

from the CEO

Water sustainability and an update on the Competition Commission retail market enquiry Given the recent water challenges and constraints, water sustainability has been a big talking point around the country. The increasing water requirements of South Africa’s growing population are challenging the sustainable utilisation and management of our water resources

ecause of the ongoing drought and unseasonal heat, the city is expected to reduce usage by 15%, following a Government Gazette notice by the National Department of Water and Sanitation to curtail the extraction of water for urban use from the Integrated Vaal River System by 15%. This is in response to declining water levels in the system. Dams in the system have declined to 51%, while the Vaal Dam is dipping below 30%. If the Vaal Dam drops below 20%, the take-out pumping points are compromised. MMC for Environment and Infrastructure Service in the City of Johannesburg, Councillor Anthony Still, released a statement stating that the city would introduce stronger water restrictions to achieve the required 15% reduction in its water consumption. This is a serious situation and a cause for concern. The immediate consequences are more severe restrictions by Johannesburg Water until the full reduction of 15% in water demand is achieved and maintained. The outflow of water from its reservoirs and water towers will be reduced to affect consumer

behaviour and to protect its reticulation infrastructure. These measures will result in reduced flow due to less pressure in the system. The system will still have water – but at a restricted rate. Some areas may experience low flow or the lack of water when consumers in that area do not reduce their consumption. Johannesburg Water will adopt a targeted approach to determining where decreases in consumption are required. If these measures are not effective in reducing demand by 15%, then Johannesburg Water will have to implement Level 3 water restrictions, which entail water rationing. This is undesirable because it would cause widescale water service disruption and extensive damage to the water infrastructure, which can result in significant water losses. This will have further knock-on effects and could even trickle into the commercial property industry. Although businesses won’t be affected by the increased tariffs for overconsumption, they will be affected by water restrictions that are enforced within their area of operation. Those who use water as part of the business processes will be the hardest hit. The situation may be similar in other parts of the country. During his address at this year’s Convention, “Is the Water Crisis the New Eskom”, Anthony Turton recommended the urgent intervention of an Integrated Water Management Plan underpinned by a carefully thought-out risk management strategy. If we are to have a clear way forward in this crisis we face, this intervention may need to be investigated sooner rather than later. SAPOA would like to encourage our members to be more water-wise in supporting the course of water conservation. With all the new construction in and around the country, it has now become imperative that rain-water harvesting and grey-water recycling are both incorporated within the design of these buildings from the start.

An update on the Competition Commission retail market inquiry As a follow-up from earlier updates, the Competition Commission has published nonconfidential copies of the written submissions on its website. These include submissions by the stakeholders (including SAPOA’s nonconfidential written submission) as well as submissions by members of the public. The nonconfidential submissions are available online at the Competition Commission website. The Competition Commission called for any responses to these submissions by no later than Thursday 13 October 2016. Because SAPOA’s non-confidential submission shows only the questions considered and not the content of SAPOA members’ responses, it is unlikely that there will be comment on or responses to SAPOA’s submission. However, it is possible that stakeholders or members of the public may wish to comment on the same questions considered by SAPOA’s members. According to Reena Das Nair from the Centre for Competition Regulation and Economic Development (CCRED), two of the three CCRED submissions make reference to a SAPOA survey completed in 2012 (in which 15 property owners were interviewed). It is submitted the survey indicates that 94% of property owners were of the view that they would prefer not to have exclusivity clauses in their lease agreements. A range of reasons for this view is also given. Further, it indicates that 56% of property owners were of the opinion that “exclusivity clauses had no benefit (presumably to property owners) and were actually detrimental to the management of their assets”. Reference is also made in the CCRED submissions to SAPOA’s complaint regarding exclusivity clauses. The Competition Commission aims to close the inquiry by May 2017. Neil Gopal, CEO SOUTH AFRICAN PROPERTY REVIEW

from the Editor’s desk

Water, water everywhere – and not a drop to drink As we head into summer, we need to take heed of government warnings about our water consumption. Water restrictions are already in place in most of South Africa’s metros. We look at how South Africa can be more water- and energy-efficient in the long term

oremost in my mind is the continuing effect of the drought that South Africa has faced in the past year. We have spoken to three of our regions to see where we stand; sadly, the outlook is pretty bleak. In the Western Cape, winter is usually when rainfall is abundant – but this year the dams have only reached levels of 63%, which means that Cape Town residents and surrounding communities are likely to be experience water restrictions soon. In Gauteng, the City of Tshwane has implemented a policy of no watering with hosepipes and irrigation between 6am to 6pm, while the City of Johannesburg continues to have Level 2 restrictions, which have been in place since May. Our report on KwaZulu-Natal is just as disturbing for its citizens. While some water restrictions have been lifted, this runs contrary to what we have found: predictions, should there be no seasonal rainfall, lean towards dams running dry by September/October 2017. On a positive note, it seems that South Africans are beginning to be more energyconscious, with a number of companies looking to solar power and wind as substitutes and alternatives for their reliance on traditional electricity. We have a long way to go but each step we take is a step towards a more sustainable and energy-efficient South Africa. Of course, energy efficiency is not just about saving electricity – it is about taking a holistic approach to our overall environment. It begins at home, with changing our light bulbs to LED bulbs, for example; using water wisely; fixing leaky taps and insulating our roofs. Then we need to look to our workplace environment. New builds can take a simple examination of the orientation of the building, how windows are used to make maximum use of natural daylight, how common areas can be triggered by sensors to turn on lighting and how grey water can be used not only for sanitation but for the watering of public open spaces.

SOUTH AFRICAN PROPERTY REVIEW

We spoke to Manfred Braune, the Green Building Council of South Africa’s Chief Technical Officer, to find out what it means to the commercial property industry to be sustainable. According to him, a starting point for green buildings is to look at what can be done from a passive design perspective.

We are encouraged by our members’ Menlyn Maine project, which is South Africa’s first “green city” precinct. We sent our Deputy Editor Stanley Karombo on the story’s path to get an overview – and to touch on what is next in it’s development cycle. When it comes to sustainability issues, SAPOA’s Josef Quraishi, the Chairman of SAPOA’s Sustainability Committee, is committed to regular engagement with government departments, state utilities and the country’s leading municipalities, in order to keep ahead of policy decisions. He is excited to note that according to the World Green Building Trends 2016 SmartMarket Report, South Africa is the country with the highest green share of any country. Further encouragement can be garnered from the fact that the Airports Company of South Africa has gone some way towards reducing its reliability on traditional energy

resources, by generating power through solar farms at its George, Kimberley and Uppington regional airports. At this time of the year, we find ourselves hosting a large number of events, and the SAPOA head office thanks our members for their participation and attendance. We encourage our regional secretariats to contribute to our events pages by giving us their pictures and text – it’s great to know what our regions are up to, and the pages are a perfect platform to let everyone know what has happened. It is equally important to network through these events and to get to know one another better. You never know who you will meet when you walk into your next property conference – that person may well be a SAPOA member you chatted to at the breakfast or golf day! On a more fun, but equally energy-efficient note, as we were preparing our pages, the Sasol solar challenge was concluded. It is appropriate that we should mention the development of solar technology to power our modes of transport in the magazine. Going into our next issue – our combined December/January edition – we will reflect on the past year. Our theme for the month is corporate social investment, so please let us know what your company has done to make a difference in 2016. Developers get a special mention as the next issue is also our quarterly Property Developer focus. We will be looking at Port Elizabeth and East London in particular to get a lowdown on what is happening there, as well as following up on East London’s Call2Action, which we reported on in the October edition of Property Review. We will also talk to Warwick Lord, Chairman of SAPOA’s National Developers Forum. Remember to let us know what you’re up to – please contact either Maud Nale or myself with any information you’d like to share. Happy reading! Mark Pettipher, Managing Editor

SAPOA events

APPRECIATING PROPERTY INVESTMENT

NAA GLOBAL WINNERS

Ensure that you maximise the investment returns on your next property transaction. Contact the international award winning property specialists today.

Appreciating Property Value Johannesburg - 011 684 2707 I Cape Town - 021 403 6433 I Durban - 031 830 5521

www.highstreetauctions.com A member of the National Auctioneers Association (NAA)

SOUTH AFRICAN PROPERTY REVIEW

SAPOA events 16489

R14 BILLION COMMITTED OVER TWO YEARS TOWARDS BUILDING THE ECONOMY

8 CORPORATE OFFICES

7 SHOPPING MALLS

13 000 AFFORDABLE HOUSES

Nedbank Corporate and Investment Banking delivers impactful solutions of lasting economic and social benefit. We see our financing of property development as an opportunity and means to facilitate the promotion of a better built environment. Through a shared vision with our developer clients and a flexible approach to property funding we contribute to the growth of regional economies, local communities and ultimately the broader society.

Nedbank Corporate and Investment Banking is a division of Nedbank Ltd

No 1951/000009/06. SOUTH AFRICANReg PROPERTY REVIEW Authorised financial services and registered credit provider (NCRCP16). 50 nedbank.co.za

contents

November 2016

PROPERTY SOUTH AFRICAN

Abland

REVIEW

South African Property Review

PROPERTY SOUTH AFRICAN

November 2016

REVIEW

PROPERTY REVIEW - LogoTreatment.pdf

Environment, green and sustainability

H2O Water restrictions a reality?

2016/08/25

11:31 AM

ON THE COVER Water conservation and restrictions at the forefront of the Commercial Property Leader’s minds.

Blowing in the wind

Adding new energy technology to the mix

Going green How green is your building?

Abreal

s●

series

Airports leading the way

●

monthly cou n Our

The WOR

Solar energy LD

by-country focu try-

November 2016

Nordic delights Focus on Norway

1 2 6 10 12 14 15 16 20 22 25 26 30 36 38 41 45 48 53 56

From the CEO From the Editor’s desk Industry news Legal update Promotion of Access to Information Act 2 of 2000 (PAIA) Planning and development The built environment focuses on cities of the future JHB mayoral meeting Johannesburg’s Executive Mayor meets with SAPOA captains of industry Western Cape executive A man with a mission Greening issues How green is our country and its buildings? Sustainable energy George, Kimberley and Upington airports electrified Alternative energy The winds of change are a-blowing in South Africa Eastern Cape energy mix Energy-Mix creates jobs in Eastern Cape H2O Western Cape, KwaZulu-Natal, Gauteng Sustainable developments Crystal Lagoons’ sustainable, innovative technology Menlyn Maine The country’s first “green city” precinct Sustainability in focus Focus on promoting sector, sustainable technology use Eye on the world Norway Profiles Events Career day Exposing learners to the property industry Off the wall Powering up your ride

Oilgro

FOR EDITORIAL ENQUIRIES, email mark@mpdps.com 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 Editor in Chief Neil Gopal Editorial Adviser Jane Padayachee Managing Editor Mark Pettipher Copy Editor Ania Rokita Production Manager Dalene van Niekerk Designers Wade Hunkin, Eugene Jonck Sales Robbie Pansegrauw e: rob@mpdps.com; Riëtte Stevens e: sales@sapoa.org.za Finance Susan du Toit Contributors Lekgolo Mayatula, Mumtaz Moola, Maud Nale, Nicky Manson, Phil Ruimte, Rebecca Jackman, Stanley Karombo Photographers Mark Pettipher, Mariola Biela DISCLAIMER: The publisher and editor of this magazine give no warranties, guarantees or assurances and make no representations regarding any goods or services advertised within this edition. Copyright South African Property Owners’ Association (SAPOA). All rights reserved. No portion of this publication may be reproduced in any form without prior written consent from SAPOA. The publishers are not responsible for any unsolicited material.

P R O P E R T Y Printed by Designed, written and produced for SAPOA by MPDPS (PTY) Ltd e: mark@mpdps.com

e: philip@rsalitho.co.za

F U N D

industry news

New CEO and Chair for GBCSA

GBCSA CEO Dorah Modise

he Green Building Council of SA (GBCSA) has announced the appointment of sustainability expert Dorah Modise as its Chief Executive Officer, the highly experienced Rudolf Pienaar as its new NonExecutive Board Chair and Faieda Jacobs as Non-Executive Deputy Chair. Modise will take the reins as CEO from February 2017; Pienaar and Jacobs have taken up their positions already. Founded in 2007 as part of a larger network of Green Building Councils globally, the GBCSA champions the application of green building principles and practices in South Africa’s property sector, seeking to inspire a built environment in which people and the planet can thrive. These high-profile appointments signal the increasing importance of sustainable building practices in South Africa. Modise’s skills set and 17 years of experience in the sustainability sector, in particular, are an exceptional match for the organisation. Currently serving as the Strategic Executive Director of City Sustainability at the City of Tshwane, she holds an MBA from the University of Pretoria’s Gordon Institute of Business

Science and a master’s degree in environment and development from the University of Sussex in the UK, as well as a post-graduate diploma in environmental diplomacy from the University of Geneva in Switzerland and a first degree in environmental health from the Tshwane University of Technology. Prior to her role in transforming Tshwane into the greenest and most sustainable city on the African continent, Modise was Chief Policy Advisor for Sustainable Development at the South African Department of Environmental Affairs, where she spearheaded South Africa’s engagements in global sustainable development negotiations and the environment sector green economy response, including the establishment and management of the national green fund. Pienaar holds impeccable credentials for his new position, having been appointed first as Non-Executive Deputy Chair of the GBCSA Board in April last year, and then as Non-Executive Director of the World Green Building

Council, representing Africa, three months later. He is a long-time champion of sustainable, green building practices, which he has implemented in the R32billion office portfolio that he manages as divisional director at Growthpoint Properties. Jacobs is responsible for strategic projects at Old Mutual Property. She has 30 years of experience in property, ranging from property management and property asset management to people management. Prior to joining Old Mutual Property, she was a property manager at Fountainhead Property Trust and Allan Gray Property Trust. “The GBCSA has taken great strides forward in the past nine years, leading the movement to design, build and operate properties in an environmentally sustainable way,” says outgoing NonExecutive Chairman of the GBCSA Seana Nkhahle. “This firm foundation paves the way for this exceptional new leadership team to focus on sustainability in the public sector, developing green buildings at scale and building sustainable communities – all of which

dovetails perfectly with Dorah’s particular skills set and experience. The GBCSA is in good hands and is assured of a bright and successful future.” “The GBCSA has seen significant growth since its inception in 2007 and is geared to grow substantially in the years to come,” says Modise. “This is mainly the result of the increasing significance of the property sector in the reduction of global greenhouse gas emissions, and the overwhelming balancesheet benefits brought about by efficiency savings. “I am particularly passionate about sustainability and believe that South Africa has a lot to offer in this field. I’m excited about this new, challenging venture and look forward to working with the great team of professionals that I’ve come to know over the years, and a board that’s really committed to the success of the organisation. Rudolph Pienaar comes with in-depth knowledge of the industry and is well placed to provide the leadership and guidance required to get the GBCSA to its next great destination.”

FROM LEFT GBCSA’s outgoing CEO Brian Wilkinson, Non-Executive Deputy Chair Faieda Jacobs, incoming Non-Executive Board Chair Rudolf Pienaar and outgoing Non-Executive Chair Seana Nkhahle

SOUTH AFRICAN PROPERTY REVIEW

industry news

An essential guide for the safe, efficient and cost-effective running of any facility

Sandton Central – live the park life outh Africa’s commercial capital, Sandton Central, offers visitors and residents more than just world-class business, retail, residential and tourist facilities. It is also home to three wonderful parks that connect this thriving city to the great outdoors. Providing the perfect venue for summer festivals and year-end functions, Sandton Central offers ample space for people to reconnect with nature, unwind and socialise with friends and family on lush green lawns sheltered beneath the shady trees. “Joining leading cities across the globe, Sandton Central recognises the importance that green lungs play in welldesigned urban fabric that provides a full experience for the people who use it,” says Elaine Jack, City Improvement District Manager of the Sandton Central Management District. “These precious outdoor spaces provide people with an opportunity to take a break from the hustle of city life; they also provide opportunities for groups of people to get together and enjoy themselves without feeling the restrictions of four walls around them.” Innesfree Park, conveniently located on Katherine Street in Sandown, offers residents and visitors respite from the rigours of city life. Here you’ll find two tranquil dams and plenty of open space in which to have picnics or just take a lunch break. “Because of its size, Innesfree Park is known to host large-scale events such as music concerts, motor shows, arts and culture exhibitions, and a number of other outdoor shows. It is also ideal for smaller private parties and picnics,” says Jack. Another extraordinary lush green hideaway situated in the heart of the Sandton central business district, Mushroom

Farm Park (renamed Hyundai Sky Park) boasts a fully equipped playground for kids, a duck pond, an amphitheatre, hilly landscaped lawns and an outdoor gym. Popular with families for weekend picnics, the giant Hyundai-branded hot-air balloon, which rises 120m above the park, offers visitors an incredible view of Sandton, weather permitting. Dog walkers are also welcome to this park, provided their pooches are on a leash, and the neatly paved walkways are perfect for strollers or joggers. There are also tables, benches and clean public toilets on site. A small, intimate park located in the heart of the financial district, Sandton Central Park offers a blank canvas that’s perfect for niche events. The park occasionally hosts live music day festivals as well as other events, and offers an amphitheatre, sculptured garden beds, indigenous tress, solarpowered lights, and benches. “Sandton Central’s parks build a healthier community by providing green spaces in which people can socialise and enjoy recreational activities and events,” says Jack. “These spaces have been designed to be enjoyed and shared by the community, and we encourage people to make use of them.” The mandate of Johannesburg City Parks and Zoo (JCPZ) is to create safe recreational spaces for residents of the greater Johannesburg area. JCPZ has been fortunate in having the opportunity to form mutually beneficial relationships with residential associations as well as business communities to protect these open spaces. Louise Gordon, JCPZ’s GM of New Business Development, says numerous opportunities exist to create safe cycling, trail-running and walking lanes in parks, and host events that will encourage an outdoor lifestyle.

NEW! ISBN: 9780409077469 Price: R544.92 (incl vat and delivery)

The South African Facilities Management Handbook The role of a facilities manager encompasses a wide range of complex and challenging roles in diverse areas. This book provides a comprehensive overview of all these roles and includes checklists and practical guidelines for easy-to-find advice and industry best practice. RS047/16A

Order now! www.lexisnexis.co.za/store 0860 765 432 orders@lexisnexis.co.za

Endorsed by:

SOUTH AFRICAN PROPERTY REVIEW

industry news

New property REIT comes to the JSE T

he Western Cape is one of the fastest-growing provinces in South Africa as individuals and families migrate to the region in search of better education opportunities or a different standard of living, and commerce improves as a result. This is driving demand for residential, commercial and light industrial property. However, property availability is constrained by geographical limits, and prices are in general higher than they are in the rest of the country. Spotting the gap, property veterans Mike Flax, Abu Varachhia and Quintin Rossi have over the past five years built up a diverse portfolio of 25 property assets in the region. These include Sable Square (a retail, commercial and storage facility near Century City) and The Upper East Side, a mixed living, leisure and retail space in Woodstock. Now the partners plan to list their company, a real estate investment trust (REIT), on the JSE. The purpose of the listing is to grant Spear access to the capital markets in order to accelerate growth, enhance the deal-making abilities of the company, reduce debt and utilise scrip for acquisitions, says Flax. The initial focus is the repayment of debt. On listing, Spear’s loan to total value will reduce from about 60% to 38%. “The strategy is to keep gearing close to the 50% level,” says Flax. Naturally, the tax benefits that will result from obtaining the REIT status are also attractive to shareholders. Spear is looking to raise R300-million with the listing, of which R187,5-million has already been committed via a pre-placement of shares. The expected market capitalisation at listing is R830-million. Spear’s combined portfolio has a gross lettable area of 171 000m², valued at R1,4-billion.

A further 141 000m² of undeveloped bulk is available in the portfolio to unlock additional value. For instance, the company has zoning permission to build 100 residential properties at Sable Square, says Flax, who is the group’s CEO. It also owns a large chunk of properties along Marine Drive in Paarden Eiland. “We expect to develop these in time. The area has beautiful views, and zoning allows the building of high-rises up to 10-storeys.” The company differentiates itself from other diversified REITs by being a focused REIT that specialises in the Western Cape and is able to leverage its regional knowledge to drive growth. Strong relationships grant Spear access to regular accretive deal flow. The trend in recent years has been the listing of REITs with an off-shore focus. “We believe value creation comes from specialisation and focus,” says Paul Duncan, investment manager at Catalyst Fund Managers. “Spear is run by people who know this market very well. It is not always easy to deliver value in foreign markets, where you are competing with locals who know the market well. Local knowledge is key.” “Property stock is limited, but there are private family portfolios who may wish to merge into a specialist fund because they believe in the future growth of the Western Cape,” says Flax. “We have strong lease covenants across all sectors in which we are involved, as well as low portfolio vacancy rates. Furthermore, rental rates are well below overall market rates per sector. Low portfolio valuation per square metre displays a strong investment value proposition; this is supported by a relatively low loan to value ratio.” What may also appeal to some investors is the fact that Spear is an internally managed

SOUTH AFRICAN PROPERTY REVIEW

REIT with a low overhead cost structure and a strong management team. “Spear management will retain a 52% stake; as a result, their interests are aligned with those of the shareholders.” While few details have been released, Spear will list at about R9 and anticipates an initial full year yield of 8,2%, with earnings growth in the region of 13,5%. “This is not a dripping roast,” says Duncan. “The yield may be

Renee Feeney, Head of Leasing at Melrose Arch

ecuring new headquarters at South Africa’s most soughtafter business address, Trillian Capital Partners has moved its head office to Melrose Arch, crafting a fresh and highly collaborative workspace that supports its business. Adding to the long list of corporate heavyweights already enjoying the premium facilities at Melrose Arch, the country’s most iconic urban development, black-owned and managed Trillian Capital Partners and its exceptional people will benefit from the many advantages of this leading mixed-use, new urban precinct. “Trillian Capital Partners strives to find tailored solutions for its clients, and we believe we have provided the same, offering a space that not only complements the brand and the company’s strong values, but also a place where its business can flourish,” says Renee Feeney, Head of Leasing at Melrose Arch, who concluded the deal. “As a significant private sector financial services provider,

lower than other equivalent small caps, but the company is likely to deliver strong earnings growth driven by an active, focused team. Investors will be putting their faith in this.” With a market cap of less than R1 billion, Spear will not appeal to the big institutions, but to smaller funds with a niche focus. Investors may need to have a buy-and-hold view, as the share is likely to be relatively illiquid, says Duncan.

Melrose Arch gives Trillian Capital Partners fresh new headquarters Trillian Capital Partners’ decision to move its operations to Melrose Arch will no doubt see them reap a multitude of rewards. Melrose Arch not only offers convenience and security, but also an extensive list of premium facilities for employees and clients.” Trillian Capital Partners, challenging convention with its market-leading practices, drives socioeconomic development through its five functional business units: financial advisory and specialised finance, management consulting, asset management, securities, and property. “Trillian Capital Partners is proud to conduct its business at Melrose Arch,” says Tal Hassall, Brand Manager for Trillian Capital Partners. “Integrating centrality, accessibility and security seamlessly, the precinct creates a welcoming and safe environment for all those who visit it. A premier mixed-use development, Melrose Arch is accessible to both private and public transport commuters.

industry news A rich variety of hotels, restaurants, coffee shops, entertainment venues and retail spaces surround us. This affords both us and our visitors all the creature comforts necessary to find a happy work-life balance. “With our new headquarters, we are able to create a safe and welcoming environment where our people can express themselves as individuals, as a team and as a community. The new offices also allow us to develop a sophisticated workspace that blends innovative technology with a strong people focus, ultimately simplifying the way we do business.” Trillian Capital Partners’ headquarters incorporate innovative spatial design, cutting-edge technologies and versatile collaborative spaces, all contributing to an impressive yet practical corporate office suite. The well-appointed 2 400m² area also boasts a state-ofthe-art business centre and comprises a range of facilities and meeting rooms, providing the company’s clients and partners with an unrivalled customer experience. “We now have a fresh, exciting atmosphere that’s light, lively and collaborative, enabling us to work closely with one another, our clients and our partners, as well as a head office that makes a bold and unique statement about who we are and what we stand for as a brand,” says Hassall. The environment was an important factor in Trillian Capital Partners’ final decision. Hassall believes that Melrose Arch, an ambassador for environmentally sustainable business practices, has become an increasingly important transport node, one he says will continue to connect people in an ecofriendly way.

Solar farms move to the cities U

rban property developers have realised the potential of city rooftops for solar farming, with factories and shopping malls being increasingly transformed through the installation of acres of solar panels on previously underutilised roof space. Juwi Renewable Energies has assisted Growthpoint Properties in identifying its premium properties as ideal locations for solar farms. Northgate Shopping Centre, co-owned by Sasol Pension Fund in Johannesburg, is the latest urban mall identified for the company’s rooftop solar installations. Greg Austin, MD of Juwi Renewable Energies, the EPC provider to the projects, says solar is moving into cities on an industrial scale. “The Northern Cape is the centre of the solar industry in the country, but large-scale property owners in urban areas are realising the potential cost-saving in bringing solar farms closer to the area of demand and creating ownconsumption solutions,” he says. Shopping centres, with their large flat roof areas, are ideal candidates for solar solutions.

At Northgate Shopping Centre in Gauteng, a newly completed 960kWp roof-mounted solar PV installation is set to produce nine percent of the total energy required by the shopping centre. The installation is believed to be one of the biggest thinfilm PV technology projects in the country. ”Although not new to South Africa, thin-film technology has a higher energy yield in low-light/shading conditions, and a higher energy yield at high temperatures,” says Juwi Project Engineer Coen Fourie. “With increasing efficiencies and decreasing prices internationally, this installation will guide the way for future thin-film projects in South Africa.” Fourie elaborates that three different roof formats have been used in the project. “These PV modules can be used on any roof or carport – flat or pitched, as at Northgate. The rooftop system can be applied to a wide range of applications, including industrial complexes, hospitals, airports and office blocks.” “Growthpoint Properties is committed to solar energy

generation, and the leading driver for this project was a combination of electricity production and maximum demand savings,” says Werner van Antwerpen, Head of Sustainability and Utilities at Growthpoint Properties. According to Fourie, the project – which took 12 weeks of construction – was completed on schedule, and entered commercial operation on 15 August 2016. A portion of the installation and interconnection was carried out at night to minimise the impact on the centre. The project supported local skills and job creation: “We used local labour for the project, all of whom were trained on site.” Juwi will provide operations and maintenance services to Growthpoint Properties on the Northgate project, as part of its growing fleet of more than 120MW of solar PV installations being monitored from its Cape Town office. Growthpoint Properties has also contracted Juwi to install a similar roof-mounted solar PV installation at Brooklyn Mall in Pretoria, which it owns and manages, in early 2017.

Juwi Renewable Energies has recently completely a 960kWp roof-mounted solar PV installation at Northgate Shopping Centre in Gauteng. It is set to produce nine percent of the total energy required by the shopping centre

SOUTH AFRICAN PROPERTY REVIEW

legal update

Promotion of Access to Information Act 2 of 2000 (PAIA) By Mumtaz Moola

ection 32(1)(a) of the Constitution of the Republic of South Africa provides that everyone has a right of access to any information held by the state and any information held by another person that is required for the exercise or protection of any rights. The object of PAIA is to give effect to the constitutional right of access to any information held by the State and any information that is held by another person and that is required for the exercise or protection of any rights; and to provide for matters connected therewith. The system of government in South Africa before 27 April 1994 resulted in, among other things, a secretive and unresponsive culture in public and private bodies which often led to abuse of power and human rights violations. ● Section 8 of the Constitution provides for the horizontal application of the rights in the Bill of Rights to juristic persons to the extent required by the nature of the rights and the nature of those juristic persons; ● Section 32(I)(a) of the Constitution provides that everyone has the right of access to any information held by the State; ● Section 32(I)(b) of the Constitution provides for the horizontal application of the right of access to information held by another person to everyone when that information is required for the exercise or protection of any rights; ● And national legislation must be enacted to give effect to this right in section 32 of the Constitution.

Bearing in mind that… ● The State must respect, protect, promote and fulfil, at least, all the rights in the Bill of Rights, which is the cornerstone of democracy in South Africa; ● The right of access to any information held by a public or private body may be limited to the extent that the limitations are reasonable and justifiable in an open and democratic society based on human dignity, equality and freedom as contemplated in Section 36 of the Constitution;

SOUTH AFRICAN PROPERTY REVIEW

● Reasonable legislative measures may, in terms of section 32(2) of the Constitution, be provided to alleviate the administrative and financial burden on the State in giving effect to its obligation to promote and fulfil the right of access to information.

And in order to… ● Foster a culture of transparency and accountability in public and private bodies by giving effect to the right of access to information; ● Actively promote a society in which the people of South Africa have effective access to information to enable them to more fully exercise and protect their rights. All South African companies are required to have an Access of Information Manual by 31 December 2016, registered with the South African Human Rights Commission (SAHRC). The Act states that all private bodies (those that are not now exempted) must: ● Compile a Section 51 manual, which is a roadmap of the company; ● Submit the manual to the SAHRC; ● Effect material changes, if any, each time these occur, and resubmit to the SAHRC; ● Update any material changes to the manual on a regular basis; ● Make the manual available as prescribed by the Act at the company offices and on their website; ● Annex a request form to the manual, and also make a request form available on the website and at the company premises access points. The manual must be signed by the head of the company/close corporation/entity.

Penalties for non-compliance Section 90 of PAIA provides that “A person who, with intent to deny a right of access in terms of this Act – a. Destroys, or damages or alters a record b. Conceals a record; or c. Falsifies a record or makes a false record, commits an offence and is liable on conviction to a fine or to imprisonment for a period not exceeding two years.”

The SAHRC has not yet imposed any fines for non-compliance but reserves the right to do so. PAIA is a national legislation, giving the requesters of information requesting information from public, private and government institutions the procedure to follow to get access (subject to a number of conditions) to records held by such bodies. In the case of SAPOA, requests by third parties for information will be dealt with according to its PAIA Manual and any other handbook or policies-and-procedures documentation developed for PAIA purposes.

South African Human Rights Commission guide on how to use the Act The SAHRC has compiled an easy-tounderstand guide to assist any person who wishes to exercise any right contemplated in the Act. The guide is available in all the official languages from the SAHRC.

Records available in terms of any other legislation All records kept and made available according to legislation as it applies to the specific environment in which the company operates should be made available in line with the said legislation. A person who wants access to the records must complete the necessary request form that must also be made available for easy access. If a person needs assistance with obtaining the form or on any other matter, they should contact the designated person (for example, the Deputy Information Officer). The completed request form must be sent to the address or fax number provided and marked for the attention of the Deputy Information Officer. This request must include the following: ● The records requested; ● The identity of the requester; ● Which form of access to the records is required, should the request be granted; ● The postal address or facsimile number of the requester. ● The requester of the information must explain what other right is being protected or exercised.

legal update

● The requester must indicate whether the requester, in addition to being informed in writing whether access to the record has been granted, wishes to be informed of the decision of the request in any other manner. ● If the request is made on behalf of another person, then the requester must submit proof of the capacity in which the requester is making the request, to the reasonable satisfaction of the Deputy Information Officer. ● Should an individual be unable to complete the prescribed form because of illiteracy, disability or any other reason, such individual may submit such request orally to the Deputy Information Officer. ● The requester must pay the prescribed fee (if applicable) before any further processing can take place which is annexed hereto. ● The Deputy Information Officer will process the request and inform the requester of the fees (if any and if so, will be available on the SAHRC website/ access to information/PAIA)) that are payable and of the different procedures that must be followed until the request is finalised.

The outcome of a request (granting or refusal) Should the request be granted, the notice should state the access fee (if any) to be paid upon access, the form in which access will be given, and further that the requester may lodge an application with a court of law against the access fee to be paid or the form of access granted, and the procedure for lodging such an application. Should the request be refused, the notice should state adequate reasons for the refusal, including the provisions of PAIA relied upon; and that the requester may lodge an application with a court of law against the refusal of the request, and the procedure (including the time period) for lodging such an application.

Grounds for refusal of access to records Some of the grounds on which a company may refuse a request for information as contemplated by PAIA include: ● Protection of the privacy of a third party, if that third party is a natural person, which would involve the

●

● ●

●

unreasonable disclosure of personal information of that natural person (Section 63(1)); Protection of commercial information of a third party as defined in PAIA, if the record contains: trade secrets of that third party; financial, commercial, scientific or technical information other than trade secrets of a third party, the disclosure of which would be likely to cause harm to the commercial or financial interests of that third party; information disclosed in confidence to a company by a third party, the disclosure of which could put that third party at a disadvantage in contractual or other negotiations or would prejudice that third party in commercial competition (Section 64); Protection of confidential information if the disclosure would constitute a breach of a duty or confidence to a third party in terms of an agreement (Section 65); Protection of safety of individuals and protection of property (Section 66); Protection of records which would be regarded as privileged in any legal proceedings, unless the person entitled to such privilege waives that privilege (Section 67); Protection of commercial activities of SAPOA, which includes: trade secrets of the company; financial, commercial, scientific or technical information, disclosure of which could cause harm to the financial or commercial interests of the company; information which, if disclosed, could put the company at a disadvantage in negotiations or commercial competition; a computer programme owned by the company that is protected by copyright (Section 68); The research information of the company or a third party for the company the disclosure of which would expose the third party, the company, the researcher or the subject matter of the research to serious disadvantage (Section 69).

The Manual is applicable to SAPOA and contains the details of the types of records kept by SAPOA. The manual is available for inspection at the offices of SAPOA as well as on the SAPOA website: www.sapoa.org.za.

The requester must indicate whether the requester, in addition to being informed in writing whether access to the record has been granted, wishes to be informed of the decision of the request in any other manner

This legal opinion is only a guide and should not be copied with the expectation that it will serve speciﬁc individual circumstances. Most of these recommendations have not been tested in our courts. SAPOA cannot guarantee any success in any court if any of these recommendations are put to use. SOUTH AFRICAN PROPERTY REVIEW

planning and development

The built environment focuses on cities of the future T

Lekgolo Mayatula is SAPOA’s Planning and Development Manager

Founded in 1965, ISOCARP is a global association of experienced professional planners who are committed to improving the planning practice by creating an active global network of practitioners 12

here is always a burst of new energy in the month of September. On one side of the globe, the chirping of birds and the bright colours all around symbolise new beginnings; on the other side, shorter days, autumn leaves and colder weather announce the start of winter. This is a sure sign that there’s a time and a season for everything, and that Mother Nature is always on time. The same can be said for the 52nd International Society of City and Regional Planners (ISOCARP) congress, which took place in Durban from 12 to 16 September. Founded in 1965, ISOCARP is a global association of experienced professional planners who are committed to improving the planning practice by creating an active global network of practitioners. The members are planners and other stakeholders in the built environment who share a common interest to sustainably improve the spatial and environmental dimensions of urbanisation. The theme of this years’ congress was Cities We Have vs Cities We Need, and the six sub-themes deliberated on included (a) transforming human settlements; (b) planning activism and social justice; (c) envisaging planning theory and practice for the next decade; (d) urban planning and policymaking in times of uncertainty, fragility and insecurity; (e) intelligent cities for people; and (f) planning for an interlinked and integrated rural-urban development.

SOUTH AFRICAN PROPERTY REVIEW

The sub-themes were all pertinent to South Africa, and having such a prestigious international knowledge-sharing platform brought about fantastic networking opportunities for the participants and the development industry. The congress partners included the Department of Rural Development & Land Reform, KwaZulu-Natal Cogta, eThekwini Municipality, SACPLAN, the University of KwaZulu-Natal and the KwaZulu-Natal Durban Convention Bureau. The keynote speakers were from various sectors and included Professor Vanessa Watson of the University of Cape Town, urban specialist and thought leader Nicholas You, Michael Hardman – a lecturer at the University of Salford, Minister in the Presidency Jeff Radebe, MEC for Public Works & Human Settlements Ravi Pillay, and the Provincial MEC for Cogta Nomusa Dube Ncube. SAPOA was represented by Kate Ralfe, Hlalelo Makwabe and Bheki Shongwe from the KwaZulu-Natal regional branch – and gathering from their feedback (which is available via the regional link) the congress was extremely informative, highlighting a number of planning developmental aspects from an international, national and local perspective. The pressures of urbanisation and how cities need to gear themselves up for change by using their spaces as engines of innovation was a subject that provoked great interest among SAPOA’s representatives. Urban studies predict that by the year 2050, 70% of the world

population will be located in urban areas (cities/megacities). It is also estimated that, in the same period, eight out of 10 South African will be urban residents. To visually illustrate the population growth in the urban environment, UNICEF (in collaboration with design studio Periscopic) released an interactive HTML5 visualisation called “An Urban World”. It shows the world without geographic boundaries, and depicts the areas of increased population with coloured circles of various sizes (indicative of population growth). According to these images, it is predicted that by the year 2050, China and India will have about a billion people living in their cities alone. Through the sub-themes, the congress was able to focus on aspects such as urban slums, smartly scaled communities, urban agriculture, under-developed rural environments and their connection to the urban environment, the development of smart cities, and sustainable cities. The common golden thread that connected all the interactions was the need to consciously change the way in which we design and develop our living environments and understand that we are all inter-connected. This needs to be expressed in the built environment, especially in our cities. The truth is, we are headed into unknown territory, which requires us to intentionally and actively change our self-centred habits

planning and development into ones that acknowledge and reflect our inter-dependency. In order to ensure that all the role-players involved in the development of human settlements work towards a common agenda, the United Nations will be hosting the Habitat 111 conference on Housing and Sustainable Urban Development from 17 to 20 October in Quito, Ecuador. The aim of the conference is to reinvigorate the global commitment made in 1996 by the member nations and organisations on sustainable urbanisation through the adoption and focused implementation of a New Urban Agenda. The New Urban Agenda recognises that urbanisation poses massive challenges in terms of the delivery of housing, infrastructure, basic services, food security, healthcare, education, decent job creation, safety, as well as the protection and preservation of natural resources. However, not all is doom and gloom. Just like the beautiful images created by the sun as it peeks out from behind a dark rain cloud, urbanisation is the silver lining that provides great hope for the future. Urbanisation is the catalyst the world needs to create sustained and inclusive growth, social and cultural development, and environmental protection. It can also contribute towards the achievement of transformative and sustained developments. This agenda aims to readdress the way cities and human settlements are planned, designed, financed, developed, governed and managed. It cannot be considered a coincidence that all these great events take place at this time, when we as a country are going through changes and grappling with ways to find solutions that will unite us and carry us through to the next chapter of our epic journey.

The question we should be asking ourselves is whether we are ready for the inevitable change. If we say that we are, do our actions reflect this? Have our planning policies, development funding structures, and other associated development levers been reworked to accommodate the needed change? If not, what will it take for us to see the window of opportunity that is placed at our very doorstep? The United Nations’ New Urban Agenda serves as an instrumental developmental tool that provides the world with a common reference point on how to change. The vision for the development of cities is summarised as follows: ● Cities must provide equal use and enjoyment for all that live and interact within them. ● All people residing in cities must be able to enjoy equal rights and opportunities. ● Cities must fulfil their social and ecological functions. ● Cities must promote participatory engagements across all spheres of society. ● Cities must promote gender equality. ● Cities must meet the challenges and opportunities of the present; this should be done in a manner that preserves and sustains future needs. ● Cities must fulfil their territorial functions across administrative boundaries. ● Cities must promote age- and gender-responsive planning. ● Cities must adopt and implement climate change disaster risk reduction plans and management strategies. ● Cities must protect, conserve, restore and promote their ecosystems in order to minimise environmental impact and promote responsive consumption. (Source: Habitat 3 – New Urban Agenda, 10 September 2016.)

While the New Urban Agenda provides an implementation plan to ensure its vision is realised, the question is how prepared Africa and South Africa are to follow through on this vision. Is Africa (its cities) adequately gearing itself up for the tech revolution? Is South Africa seriously interrogating the opportunities and challenges presented through technology? How are these being incorporated in our current planning and development policies and frameworks? Anuradha Chakrabarti, Kiranjith Chulliparambil and Prasanth Charakunnel, from the Drishti Center for Urban Research in based in India, conducted a presentation at the ISOCARP congress titled “The Urban Conundrum in Defining Smartness; Citizen or Technology: A Critique into the Indian Idea of Smart City” (Isocarp.org/52ndisocarp-congress/results-52ndcongress). The presentation highlighted some of the challenges facing Indian cities, which included the negative impacts of the development of dams, the unintended loss of natural resources such as lakes and vegetation, the rising air pollution (which will inevitably impact on the life expectancy of citizens), and the negative impact that waste pollution has on the environment. All these aspects (and more) need current solutions, and given the fact that the population in the Indian cities is not likely to decrease, the Drishti Center has cautiously turned its attention to exploring how technology can be used to address current and future challenges. The presenters boldly include considering a city without a history. They suggest the following: “What if we delete the entire evolution of a city and only leave behind edifices and inhabitants? How would a city without a history or a culture look like?”

This is a difficult question to grapple with given that, as individuals, we use our history to define our origins and our achievements and, in some instances, to validate our future expectations (or entitlements).

The question is how we as the role-players in the property development sector see ourselves in creating a future not restricted by history The question is how we as the role-players in the property development sector see ourselves in creating a future not restricted by history. By no means is it being said that history does not have a part to play in the changing of our cities. The truth is that the future, the past and the present are all part of a fine balancing act that requires brave and innovative individuals to sculpt a path and lead humanity to a new, more humane frontier with the use of the current tools we have at our disposal. This should be done without forgetting the greatest gift we have in each other. The built environment and its various role-players are well placed to facilitate the change that is expected and well reflected in our cities. The Sesotho proverb “Motho ke motho ka batho” means “I am because you are”. It is a philosophy and a commitment that all roleplayers in the built environment need to consciously implement – and there is no better place to do this than on the mother continent of Africa.

SOUTH AFRICAN PROPERTY REVIEW

JHB mayoral meeting

Johannesburg’s Executive Mayor meets with SAPOA captains of industry Job creation, fighting corruption and fast-tracking service delivery top priorities Compiled by Maud Nale Photographs by Mariola Biela

he newly appointed Executive Mayor of the City of Johannesburg Councillor Herman Mashaba says he will focus on regenerating the inner city in order to create and boost employment in South Africa’s economic hub. Mashaba met with SAPOA captains of industry to highlight his vision for his five-year tenure. At the top on his list of priorities is the regeneration of the inner city, aimed at boosting job creation, fighting corruption and the fast-tracking of service delivery. Mashaba, who has been in his role for just under three months, said he wants the city centre to be a place where people can go to live, work and play. “It is one of my biggest priorities,” he said. With regards to job creation, Mashaba said that the unemployment rate stands at about 30% in the city. “More than 800 000 of our residents are without jobs, with youths being the biggest casualty,” he said. “About 10 000 new people come to the city every

month in search of work opportunities. The city requires a minimum of five percent GDP growth to reverse this.” He further highlighted the importance of collaborations with strategic partners such as SAPOA in achieving the city’s vision.

“The road ahead is tough,”he said. “Government needs to create an enabling environment for private-sector involvement. As the economic hub of this country, it is important that we work together to save South Africa. If Johannesburg works, the country works.”

Executive Mayor of the City of Johannesburg Councillor Herman Mashaba with SAPOA CEO Neil Gopal

FROM LEFT Rudolf Pienaar (Growthpoint Properties), Amelia Beattie and Alex Phakathi (Liberty Two Degrees) and SAPOA President Elect Peter Levett

SOUTH AFRICAN PROPERTY REVIEW

Western Cape executive

A man on a mission Engagement and collaboration with the private and public sector and civil society is high on the agenda of SAPOA’s Western Cape Regional Chairman Marlon Parring

Marlon Parring, commercial property broker at Par Brokerage and Group COO of Par Equity

arlon Parring, a commercial property broker at Par Brokerage – part of the Parring Group – is SAPOA’s new Western Cape Regional Chairman. In this capacity and in line with his personal ethos, Parring will focus on mentoring young people to attract them to the industry, transformation, and greater collaboration with the public sector, government departments and municipalities. “The private sector has the ability to deal with many of the challenges we have in the property sector,” he says. “If I can be part of and develop the collaboration process through my position here at SAPOA, then I will have served the industry well. This was something that was started before my time at SAPOA; I am merely emulating what previous officebearers had put down as a foundation. “Looking at the three pillars – civil society, public sector and private sector – I’m looking for ways in which we can combine our efforts, unlock property development opportunities, and address society’s social ills. The property sector has a big responsibility to unleash the economic potential South Africa has to offer. “As part of SAPOA’s contribution, we have submitted comments to the IDP, the City of Cape Town’s strategic plan for the next five years. Our submission generated instant feedback from Deputy Mayor Ian Neilson

and his team. Neilson immediately issued a challenge to SAPOA to see how it and the private sector can assist with several issues, such as the spatial development plan that the council is currently reviewing, which includes signage, the efficiency and cost of broadband internet, inclusive affordable housing, and generally improving the region’s economy. The challenges are big but they can be dealt with, and I am excited about being involved and being able to serve in any capacity. “SAPOA is doing a fantastic job in engaging with the City of Cape Town, and we need to communicate this to members so they know their voices are being heard and their issues are being addressed, and to encourage members to be part of the process. That is the positive influence SAPOA can bring to the city. “When it comes to the private sector – which has the resources and the capacity – we can play a role in developing partnerships for the greater good. This is where our opportunity really lies, to contribute to a sustainable and inclusive economy. Then we can deal with the other symptoms – social ills and crime – facing society.”

Doing it right “I would like to do more cooperative work with educational institutions such as the University of Cape Town (who we already work closely with) around the issues of inclusive affordable housing. If we can address these developments differently, include public spaces and pleasant environments and take into account transport constraints, they can be successful. If more research is done, we will find ways to make inclusive, affordable housing work.”

“The private sector has the ability to deal with many of the challenges we have in the property sector. If I can be part of and develop the collaboration process through my position here at SAPOA, then I will have served the industry well. This was something that was started before my time at SAPOA; I am merely emulating what previous officebearers had put down as a foundation”

Engaging the youth “I am also committed to attracting younger people into the property industry,” he says. “There are plentiful opportunities for them in the private sector, and I’m excited by the amount of young talent out there. SAPOA can play a particular role here by fostering engagement with these youngsters. I want to invite some of this young talent to our functions, let them meet the people, and see what’s it all about. Then, when they enter the property industry, they have some sense of what is happening out in the world.”

More about Marlon Parring Parring was schooled at Bishops College in Cape Town, studied economics and graduated with a BCom from UNISA. He is a director at Par Brokerage Services and Group COO of Par Equity, both part of the Parring Group. The group has its headquarters in the centre of Cape Town. SOUTH AFRICAN PROPERTY REVIEW

greening issues

How green is our country and its buildings? South African Property Review spoke to Manfred Braune, Chief Technical Officer and Executive Director of the Green Building Council of South Africa (GBCSA), about what it takes and means to be a green building – and how it contributes to sustainability

GBCSA Chief Technical Officer Manfred Braune

This will be a huge challenge for the industry and requires a paradigm shift in thinking. In many ways, we are locked into a specific way of development because of our short-term financial reporting cycles and our financial metrics and indicators of a ‘successful development’

SOUTH AFRICAN PROPERTY REVIEW

ccording to Manfred Braune, GBCSA’s Chief Technical Officer, sustainability in the built environment is a broad field. It involves everything from ecology and ecosystems to energy, transport, waste, water and materials used in buildings. It is a complex concept, especially in buildings that have multiple technical systems, plus the external environment interacting with an internal environment, and ultimately the people who then live, work, play and are educated in these buildings. “Buildings are not static,” he explains. “People occupy buildings so people are a key factor in sustainability. Sustainability involves the natural environment and resource depletion and addresses issues concerning the planet, such as carbon emissions and water usage. Sustainability within the built environment is really about how buildings and cities are developed to reduce the impact and create a better environment by contributing to the natural environment and people, as opposed to simply doing less ‘bad’. For example, if we can start creating buildings to produce more ‘potable’ water than what they require annually, or produce more energy (i.e. there is a net surplus of water or energy), we won’t have to rely solely on our dams for water, and the buildings themselves can become an energy source for not only their own requirements but also for neighbouring buildings. In this way, the built environment can start contributing and having a net positive impact. That’s what we really need to see over the next 20 to 40 years in the industry: to create a world in which people and planet can thrive for generations to come. “This will be a huge challenge for the industry and requires a paradigm shift in thinking. In many ways, we are locked into a specific way of development because of our short-term financial reporting cycles and our financial metrics and indicators of a ‘successful development’. There is a standard way of doing things that has to be turned on its

head to be able to deliver the kind of built environment that contributes to long-term sustainability and, ultimately, saves our planet. It will require longer-term and alternative approaches to financial returns, and will need to start including other metrics such as natural capital and social capital.”

Big focus on education “New engineering graduates come out of university and onto the job market annually, so it’s important to educate them about sustainability during their studies,” says Braune. “We work with selected universities that we have a relationship with; where there is an open invitation to participate or support, we dive in. Last year, together with Growthpoint Properties, we launched the Greenovate Awards programme – a student awards programme for green buildings. We started off by focusing on the property studies faculties at Wits, UCT and the University of Pretoria, delivering our green building courses to these faculties. The faculties then choose their top green building thesis students and run a competition around that. It’s an initiative that is growing, and gives us access and the opportunity to provide sustainability education to property students. Next year this will be launched in the engineering faculties with the universities where there is interest. Besides students, the GBCSA focuses and provides green building education in the professional working environment as well. Refer to the GBCSA website where all the education offerings are spelt out. “To date, we have close to 9 000 heads trained in green buildings. That’s on average 1 000 heads trained each year. (In September 2016, the GBCSA – a non-profit organisation – had been in existence for nine years.) Of those 9 000, there are about 1 500 who have been awarded our mini-accreditation qualification, which means they have been educated about and accredited on various aspects of green building sectors – new

greening issues An engineering background Manfred Braune was a consulting engineer with WSP for about 10 years, designing shopping centres, hotels and offices. He started the green building division for WSP in 2008, and ran it until 2010 when he moved to the Green Buildings Council of South Africa to head up technical and education activities there. He is currently the Chief Technical Officer and an Executive Director on the board of the GBCSA.

buildings, existing buildings in operation, interior fit-outs, and residential. So there is a big focus on education to help enable the industry to design, build and operate more – and better – green buildings.”

Making old buildings green “This involves a combination of things,” says Braune. “It’s not a one-rule-fits-all scenario. It involves auditing what the building is, what is currently there, what will the building be used for, what can be reused, and of course the building’s heritage – there are legislative regulations around that. In terms of green buildings, we want to reuse as much as possible where appropriate. In some cases, complete demolition is the only option, but is hopefully a last resort. However, there are other things one can do in this situation – recycle some of the materials, put them into the supply chain, and recycle and upcycle for another purpose. In other cases, a deep retro-fit will suffice, where for example the mechanical systems and lighting systems undergo a complete overhaul, and the façade maybe is redesigned and built. In some case much simpler retrofits can be undertaken, such as changing light bulbs to LED or fluorescents, depending on the specific building requirements, the tenants, and the sort of operation the building is going to be used for. “There are a lot of existing buildings with potential. This is where the biggest opportunity for impact is, so one of our strategies has been to focus on that sector of the market. We’ve developed specific green building rating tools for existing buildings that address issues such as energy and water consumption, cleaning and maintenance policies, and how these can be improved while the building remains occupied. It is also important for property owners to understand the long-term strategy for their portfolio and ask questions such as what they are going to do over the lifetime of

that building, their asset, to improve its performance. This involves looking at the environmental performance, which typically translates back into financial performance, because there are cost savings that can probably attract and retain tenants, resulting in fewer vacancies. We’ve really seen an exponential growth in the uptake of this rating tool. Growthpoint has been a leader in working on getting their office portfolio certified through this tool, and Redefine is starting to do the same thing, as are others such as Nedbank, the V&A and several other property owners. It’s a 6-star rating system, but you can get buildings certified from 1-star all the way to 6-star. “The reason why it is different from new buildings, which are certified as 4-, 5- and 6-star, is that greening existing buildings – often old buildings – is a journey. We understand that property owners may just want to take

There is an assessment process that each project has to go through before it can be recognised under this standard, or to be ‘certified as Green Star’, as we call it. It’s a mainly document-based independent assessment process, so developers and building owners have to submit the plans and designs to the GBCSA for review against the standard a snapshot of the building as it is, even if they don’t want to make any alterations or improvements, and the building may end up as a 1- or 2-star. Then property owners can prepare their strategy, for example wanting 30% of their portfolio to be at least 4-star; which then allows the rating system to act as a powerful tool to inform the asset management on which buildings to improve, which to leave as they are, and which to potentially sell, based on environmental sustainability and operational performance of these buildings. “Property owners can also look at the resale value: the better the green credentials are, the better the resale value. Three years ago, the GBCSA partnered with MSCI to produce

a green building financial indicator for the property sector. This year’s one was published by MSCI in August, and it basically shows the increased rate of return of green buildings versus non-green buildings. As yet there aren’t enough certified green buildings to make up a statistical sample of green star buildings (just over 200 are certified to date), so MSCI uses energy and water consumption figures as a proxy for green building. More energy- and water-efficient buildings consistently perform better in terms of return on investment, which can then translate into a higher value of the building.”

Voluntary standard that’s fast becoming an industry norm “The council developed a standard for green building in 2008 – the Green Star SA,” says Braune. “It’s a voluntary standard, but it’s a standard that was developed in consultation with the industry, and has started to become an industry norm in terms of a green building standard for South Africa. There can only be one green building council in a country that is a member of the global network of green building councils (the World Green Building Council), which the GBCSA is a member of. The Green Star standard compares well with other leading international standards such as LEED in the US and BREEAM in the UK. There is an assessment process that each project has to go through before it can be recognised under this standard, or to be ‘certified as Green Star’, as we call it. It’s a mainly document-based independent assessment process, so developers and building owners have to submit the plans and designs to the GBCSA for review against the standard. “Independent assessors in the industry review those documents to see whether they have reached our standards and met the requirements. The buildings then get certified as having a 4-, 5- or 6-star rating (and, in the case of existing buildings, rated as 1- to 6-star). Developers of new buildings, especially buildings such as those in Sandton, are now under pressure to produce at least a 4-star rated green building because tenants are demanding a certified green building. Tenants have seen what the market has to offer and are becoming more and more educated on this.

Supported by SAPOA The Green Building Council of South Africa (GBCSA) is closely affiliated with SAPOA, which was one of GBCSA’s founding sponsors. GBCSA is also represented on SAPOA’s sustainability committee. SOUTH AFRICAN PROPERTY REVIEW

greening issues They ask whether there is a standard for a green building, then request that standard be applied to their building. “We have just released, together with the Association of South African Quantity Surveyors (ASAQS), a study on the cost premium of building green. (It can be found on our website and the ASAQS website.) The study is based on data up to the end of 2014, and shows that an average premium has been about five percent for a certified green building. The study also shows that the premium is decreasing with time, so in 2016 this average premium is likely to be less than five percent. The GBCSA and ASAQS will continue publishing the results of this study with the latest data. The speculative building, multi-tenanted developments are typically paying less of a premium because there’s more pressure in terms of budget, while big corporate tenants are spending a bit more. Tenants are starting to demand this, and if it is not delivered, the tenants will start going to other developers. It is important to look at the return on investment (from the MSCI green indicator), which demonstrates that there is a higher return on the investment for green buildings.”

Starting point for building green According to Braune, the starting point should be to look at what can be done from a passive design perspective, for example: ●● How to take advantage of the local environment when it comes to how the building performs, taking the factors of the local environment, the temperatures and, typically in that space, the winds, and the sun path into account and deciding how to orientate the building; ●● The kind of façade that’s needed to enclose the building; ●● How to take advantage of fresh air, rather than treated and recycled air, where possible; and ●● Local humidity and rainfall patterns. “There are many methods, techniques and design approaches that can be used to maximise passive design, contribute to water efficiency and so on, and that’s the best place to start. Those things often don’t cost more but involve taking advantage of what’s already there in terms of the local environment,” says Braune. “The next thing is to look at the active systems,specifically around their efficiency, so the next step is to plan how to make the building energy-efficient by choosing the most efficient lighting, air-conditioning and hot-water systems, for example.

SOUTH AFRICAN PROPERTY REVIEW

“The final stage is to look at renewable energy and renewable sources for those different aspects because these will typically require additional capital. For example, if you are going to put photovoltaic cells on the roof, the system won’t have a significant impact on reducing the overall load of the building proportionately if the building system hasn’t first been designed to be as energy-efficient as possible. So a developer needs to look at a combination of those things, especially in places where the systems are integrated and support each other. “And then, it is important to consider the management of all these factors once the building is complete, because this will give

A green building standard and rating tool has to be locally relevant – there’s international best practice but there is also a need to be locally applicable to the South African market, as well as practically achievable a guideline as to how complex or simple the systems should be. One has to think about the ongoing maintenance during the design process to make sure that the building performs as it was designed. Otherwise, there’ll be amazing green building designs that fail completely because there’s nobody to operate or maintain them.”

Minimum energy standards for buildings “In Europe and the Scandinavian countries, minimum energy standards have been in place since the 1970s, mostly because of the energy crisis at the time, which had an impact on the price of energy,” he says. “But in South Africa, there was no minimum energy-efficiency standard for buildings until 2011, when it was introduced for the first time. Minimum-energy-standard buildings are standard practice in Europe and Scandinavia, where they have incredibly efficient buildings. Hopefully, South Africa can learn from those countries’ 40 years of implementing minimum energy standards, and can leapfrog now that technology is cheaper and more available in South Africa.

“When we developed our Green Star rating in South Africa, we looked around the world and saw what was best practice internationally, and we looked at other green body councils and saw what they were doing. We saw that the Australians had developed a rating called the Green Star, which they said they would license to us and allow us to adapt for South Africa and Africa. Looking at their climate and their economy, we realised the rating } tool worked well; it was also a third- and fourth-generation green building standard as it allowed for lessons from the US system and the UK system to be incorporated. So we leveraged off that groundwork, and therefore became the fourth- and fifthgeneration of rating tool. “A green building standard and rating tool has to be locally relevant. There’s international best practice but there is also a need to be locally applicable to the South African market, as well as practically achievable. We had to find that balance, and our star rating system achieves this. A 4-star rating is best practice – best practice in the South African context of green buildings. Then 5-star is South African excellence, and 6-star is international leadership. If, for example, a visitor from the US or the UK looked at the Allan Gray building at the V&A Waterfront’s Silo precinct or the Department of Environmental Affairs in Tshwane (both 6-star buildings), they would say, ‘Yes, this is international best practice for a green building.’ That’s how we tried to develop the standard to make it work in Africa.”

Leading the way in Africa “We encourage developers in countries such as Nigeria and Ghana to use the Green Star rating system as well,” says Braune. “We work quite closely with the green building councils across the continent, and in many cases they want to adopt Green Star in their respective countries. Kenya is one country that’s already using Green Star, as is Namibia, where there are already Green Star-certified buildings (as does Rwanda). This is clearly showing growth on the continent in certified green buildings. “The GBCSA reached 200 green building certifications in September 2016, which means that 360-million kilograms of carbondioxide emissions will be saved every year just from these 200 buildings. This equates to about 84 000 cars off the road annually. It puts some of the things we are trying to achieve with these green buildings into sharp perspective.”

greening issues

200

FACT SHEET 2016

CERTIFICATIONS SEPTEMBER 2016

*Predicted savings going toward from these building per annum

2,8MILLION Currently there is over 2,8 MILLION Square meters of certified space in South Africa's Green Star SA buildings or the equivalent of 400 rugby fields These Green Star SA buildings will save a total of 336 million kilograms of carbon emissions the same as taking 84000 cars off the road Plus, they will save 260 million litres of water per annum which equates to a single day's water consumption of 100 million people

19500 The Green Star SA certified projects will produce a combined annual savings of 280 million kilowatt hours of electricity - the equivalent of powering 19500 households per annum

TAKING

84 000

CARS OFF THE ROAD

260 MILLION

LITRES OF WATER

KWH per annum saved 280 000 000 KWH

litres per annum saved 260 000 000 ltrs

SOUTH AFRICAN PROPERTY REVIEW

sustainable energy

The opening ceremony of the George Airport solar plant was attended and officiated by the Minister of Transport Dipuo Peters, the MEC of Transport in the Western Cape Donald Grant, the Executive Mayor of George Municipality Councillor Charles Staner, and other national and provincial dignitaries

George, Kimberley and Upington airports electrified In line with South African government’s developmental imperatives, energy security and diversification of the energy matrix remains a key priority to ensure sustainability of economic activity and demonstrate consideration for the environment Compiled by Phil Ruimte

eorge Airport was the second in the world to use solar energy, following Cochin International Airport in India. The first phase of the George Airport solar project, officially opened by the Department of Transport and the Airports Company South Africa (ACSA), is part of a R16-million plant that converts solar energy into direct current electricity using solar panels. The operation produces 680 kilowatts a day and powers 41% of the airport, with the aim to convert to 100% function by the end of the year. ACSA describes this project as the best way to reduce energy demand from the national grid and harness solar power to power smaller airports around the country. The initiative forms part of the company’s Vision 2030. The project falls under ACSA’s strategic environmental objectives which, in addition to reducing energy consumption, include minimising water consumption, increasing waste recycling, eradicating noise pollution and using energy-efficient materials in all airports. “In terms of our environment, sustainability means that, over time, we need to be very careful about how we use any form of energy and other natural resources such as water,” says ACSA group executive Andre Vermeulen.

SOUTH AFRICAN PROPERTY REVIEW

“As a company, we have a plan in terms of our footprint and how we’re going to consume electricity and water – especially electricity. It is about reducing our carbon footprint and becoming a carbon-neutral company.” George Airport manager Brenda Vorster welcomed the project, which currently powers the airport’s car-rental area, cargo warehousing, and flight schools and airline

offices, saying that “Our second phase will be starting within the next year.” The George Airport solar power plant, the first phase of which opened in February 2016, consists of 200m² of ground-mounted solar photovoltaic panels that can generate up to 750kW of electricity by harnessing sun energy, to make the airport and surrounds completely non-dependent on the national electricity grid.

Climate change agreement signed In April, Minister of Water and Environmental Affairs Edna Molewa signed the Paris Climate Change Agreement on behalf of the South African Government. The Paris Agreement’s central aim is to strengthen the global response to the threat of climate change by keeping a global temperature rise this century at less than two degrees Celsius above pre-industrial levels, and to pursue efforts to limit the temperature increase even further to 1,5 degrees Celsius. The agreement also aims to strengthen the ability of countries to deal with the impact of climate change. To reach these ambitious goals, appropriate financial flows, a new technology framework and an enhanced

capacity-building framework will be put in place, thus supporting action by developing countries and the most vulnerable countries, in line with their own national objectives. The agreement also provides for enhanced transparency of action and support through a more robust transparency framework. The Paris Agreement requires all parties to put forward their best efforts through “nationally determined contributions” (NDCs) and to strengthen these efforts in the years ahead. This includes a requirement that all parties report regularly on their emissions as well as their implementation efforts. Solar power forms a big part of South Africa’s NDC.

sustainable energy Kimberley Airport becomes South Africa’s second airport to use solar power

Upington airport joins Kimberley and George airports in solar power sustainability

In May this year, Kimberley Airport in the Northern Cape became South Africa’s second airport to use solar power. “We want to send the message that it is possible for South Africa to add renewables to its energy mix,” said ACSA regional airports’ General Manager Jabulani Khambule. “Energy security is not just a South African challenge but a global one, and we are open to sharing this type of technology with neighbours.” Kimberley Airport’s solar farm is located on 0,7 hectares of land in the airport precinct, using an 11kV substation as it its main source of supply. (This too is located on airport land.) The construction of the plant at Kimberley Airport started in September 2015 and was completed 24 weeks later in April 2016 at a cost of R13,5-million. Using photovoltaic 1 620 solar photovoltaic panels and 18 inverters, the plant is designed to deliver 500kWp of peak production per year. To date, the plant has generated 141 870kWh, and is forecast to produce approximately 927 000kWh per year.

July saw Upington become South Africa’s third regional airport to join the solarelectrification revolution. “With high electricity demand in country, Airports Company South Africa wants to reduce the regional airports’ dependence on the national power grid,” said Khambule. “As an environmentally conscious company, we believe it’s our role keep energy security and diversification of the energy matrix as our key priority to ensure sustainability of business activities.” Upington’s new plant is designed to deliver 1 040 500kWh of power a year to meet the operational needs of the airport. Like its Kimberley and George sisters, the solar farm is located on 0,66 hectares of land within the airport precinct and uses an 11kV substation. Construction of the plant started in October last year, and was completed at a cost of R12,2-million. It uses 1 620 solar photovoltaic panels and 18 inverters to convert solar radiation into electricity.

The completion of Upington Airport’s solar plant forms part of ACSA’s broader plan to install solar farms at all of its six regional airports. The three remaining regional airports are Port Elizabeth International Airport, East London Airport and Bram Fischer International Airport in Bloemfontein.

Heavy investment of R32,8-billion and climbing According to the NDC plan, South Africa is already investing heavily in transforming its energy sector. At the heart of this part of the transition to a low-carbon energy sector is a complete transformation of the future energy mix, which is designed to replace an inefficient fleet of ageing coalfired power plants with clean and highefficiency technology, says the Department of Water and Environmental Affairs. South Africa is investing about six percent of what would be the upper end of the costs of its adaptation per annum for the period 2021 to 2030 – totalling US$ 2,31-billion (about R32,8-billion) in 2015.

YOU’RE HOME for good Designed with the future in mind, Savanna City offers over 18 000 homes access to a multitude of schools, parks, clinics, shopping centres, churches and community centres. Our commitment in creating a SUSTAINABLE CITY for families and businesses building their legacies, is a reality made possible through our successful partnerships, engineering ingenuity and innovative building practices.

Solid ground for starting your future and building it for good TEL: 010 010 5316 www.savannacity.co.za SAINTS_BRDSC_1165

1165_SC_Print_YoureHome_SAPOA.indd 1

2016/10/05 11:08 AM

SOUTH AFRICAN PROPERTY REVIEW

alternative energy

The winds of change are a-blowing in South Africa Wind-generated power – a desirable alternate energy source – is gaining great ground in South Africa. Johan van den Berg, Chief Executive Officer of the South African Wind Energy Association, talks to our editor Mark Pettipher about the positive benefits of harnessing the power of the wind

Johan van den Berg

nergy is incredibly important to the future of any country. A large part of the South African economy is built on and dependent on energy. “Energy is a highly contested part of the economy in our country and, like in all other countries, it comes from a terrain where there was a very dominant utility player in a very dominant and a very productive role,” says Van den Berg. “But internationally, power is evolving in both senses of the word. The decisions concerning energy that are made by the country over the next five years will determine the electricity price over the next 50 years. If we choose the wrong path, we will knock ourselves out of the new economy that centres on everything going electric including transport. “Energy is a national competence in terms of the Constitution and cannot be dealt with at provincial level. Provinces may only buy and sell energy to the limit of their own demand. This means that there is an energy blueprint that determines the best thing to do in terms of what technologies to use and how much of each. It is a robust model, called an Integrated Resource Plan, and it allows the Minister of Energy to make determinations about how power will be procured – either from Eskom, the private sector or an alternative source. It also determines the energy mix – how much renewables how soon.

SOUTH AFRICAN PROPERTY REVIEW

“The many wind farms that have sprung up around South Africa are procured and operated by the Department of Energy. Eskom then buys and uses the power, and the cost is included in the broader electricity tariff. Generally, wind power is far cheaper than Eskom’s new coal power, and of late is even cheaper than Eskom’s average selling price for electricity. So in a way, this arrangement subsidises the electricity price, although that’s not immediately visible. Eskom buys the power that goes into the national grid, the green electrons mix with the brown electrons, and it all just becomes the mix from which we get our electricity. “Ultimately, wind-generated power is more sustainable because there are no fuel costs and no pollution. Wind power forms a very good part of an energy mix in South Africa and is also cost-effective. What you have is no exposure to commodity prices once the wind farm is built – no input costs, and maintenance costs that are locked in for a 20-year period. There are no surprises down the road – unlike with coal, where fuel costs vary constantly and climate/pollution concerns are ever-present. But a good sustainable energy system depends on a good source of input. “A very large wind farm will have about 60 large turbines and will cost nearly R3billion (R50-million per turbine). Each turbine produces about two-and-a-half to three megawatts. An average household uses single kilowatts, so you can imagine how many households can be powered from a megawatt turbine.” Van den Berg’s association, the South African Wind Energy Association (SAWEA), works closely with the South African Renewable Energy Council (of which it is a member) and is involved in optimising the legislative framework for renewable energy in South Africa. “SAWEA’s mandate and role is to make it happen, whether for the renewables, or more specifically for wind,” he explains.

“We have ongoing discussions with the authorities about the framework, and would like to think that we have an influence. We see our mandate as one of optimising wind power in the interests of the country. We want what is best for the country – and wind is part of it, so that is what we advocate.”

What is the best route for property owners and developers? “Property owners are becoming increasingly aware of sustainability and climate change issues, and there seems to be a growing international desire from people to buy green power,” says Van den Berg. “In South Africa we don’t have retail competition for electricity provision – this is something that I hope we will get in time – and power can usually only be purchased from the municipality. If there were two or three alternate suppliers at that level, as you see in other countries, then one could buy green power. Education on the nuances of the debate is essential for young people. If more people cared about the sustainability of the environment and spent just a bit of time trying to understand the issues and then support the renewable energy associations, we could have a very green South Africa. “At a completely different level, if people want to become greener now – if it’s a real conviction for them – then they can become

Passionate about sustainability Johan van den Berg is the Chief Executive Officer of the South African Wind Energy Association and Chair of the South African Renewable Energy Council and the African Private Sector Focal Point for the Africa-EU Energy Partnership. A qualified barrister, he has been extensively involved in dispute resolution, environmental mediation and climate change avoidance/emissions trading, and has been proactive in the efforts to bring in the use of renewable energy in southern Africa.

alternative energy energy-efficient by not using any more energy than is actually needed, insulating the entire house, and investigating the use of solar water heating. If households don’t have solar water heating or heat pumps, they can switch their water heating on and off to conserve power usage. Solar panels on the roof and even small wind turbines used together with the solar panels would be very effective.” “From a property owners’ perspective – and the best thing for the climate – is to build the most energy-efficient building possible. This is in a property owner or developer’s best interests because electricity costs money – whether it’s cheap or expensive, and wherever you get it from. In the long run, it is always better to build it right than to fix it later. Retrofitting is also an important factor to think about, but with new buildings it’s essential to get it right the first time. I would also advise that property developers look at storage carefully and don’t put it in every house, but rather put it in for the estate. And resist the urge to go completely off-grid: the more people defect, the worse it becomes for everybody still on the grid. I’m hoping we will go down the path where we stay on the grid and keep power affordable. “Wind turbines can be useful in rural areas. Our research and information indicate that the best way to electrify people who are off the grid – about 15% percent (seven-anda-half million people) of the population – is with hybrid systems that use only one energy source, for example wind and diesel, or wind, diesel and batteries.”

Energy and storage According to Van den Berg, the issue of energy has been raised many times, particularly the questions “Is technology keeping pace and providing the necessary capabilities?” and “Is wind power not variable or intermittent?” “The wind always blows somewhere, so wind power in not intermittent – but it is variable,” he says. “You could say all power plants are; even a coal plant can be intermittent. Sometimes the wind blows, or the plant can be completely offline. The question is whether you can have very high, reliable electricity with a very high penetration of renewable energy, and the answer is definitely yes. There is more than one way to do this, and storage is one option. Technology is advancing at breakneck speed, although we are still about five years away from costs maturity and feasibility. “What the smart-energy modellers are telling us is we can have an extremely high penetration of renewable energy in South Africa

that is very stable because we are such a big country with endowments of both wind and solar. If spread across the entire country, it is easy to model a projection of what power can be produced as a minimum. Some days, when the wind really blows and the sun really shines, there will be more electricity than required; you either use the excess electricity or pump storage, or put it into batteries or make carbon-neutral liquid fuel through a complex process. “This will be discussed at our annual conference and Windaba. We will debate how to approach a 100%-renewable source in the next 30 years while keeping all the practicalities in mind. The Paris Agreement [an agreement within the United Nations Framework Convention on Climate Change], drafted in December 2015 and signed in April 2016 by 191 countries, talks about complete carbonisation after 2050. This means we have 35 years or so to get out of fossil fuels and stop polluting because that is the level of environmental tolerance. Places such as Brazil are extremely lucky because they have a lot of hydro; hydro is less variable than wind or photovoltaic (PV) systems, so they have a slightly easier task than some other countries. South Africa, however, has a much easier task than other smaller countries that might have only PV or only wind. Germany has done incredibly well, having put all its resources into this – but, as you can imagine, in northern Europe the PV yield is half of what we have in South Africa. They have lots of wind but only in the northern parts of the country, not in the south – yet they are managing, they are planning, and they are striding ahead. This is what we are striving for. We have no choice, environmentally – and yet it is the cheapest option. “This is the biggest change over the past 10 years. It is smart business. You do it to make a profit and yet you are doing something for the planet.”

How cost-effective is renewable energy? “In South Africa, the retail cost of the electricity that Eskom sells is somewhere in the region of 83 cents per kilowatt hour,” Van den Berg explains. “It then goes to the municipality, which adds a mark-up on the electricity – this is a fundamental part of their funding. As a household, a consumer ends up paying about R1,70 or more for a kilowatt hour. It varies across different jurisdictions, and is lower in some places. City Power marks it up about 60%, while smaller municipalities put on a 100% mark-up or more. In Cape Town, households pay about R2 per kilowatt hour.” “Currently, to put solar panels on the roof, plus storage, will cost about R3 per kilowatt hour, or slightly less. Tesla is predicting that, in five years, putting up panels with storage will cost R1,20 per kWh. A lot of electricity price increases are locked into the Eskom price path. If we unwisely choose to go down the nuclear road, these would be greatly exacerbated; our projections show that in five years the price of electricity would be R2,80 at residential level – but it would cost R1,20 to put your own solar panels in storage. This means there is a massive incentive to defect from the grid, which means the power has to be paid for by a smaller number of consumers and its price will have to increase again, resulting in the “utility death spiral”. It’s incredibly important to keep people on the grid because it remains the most efficient system for South Africa. It’s a massive issue we have to sort out going forward. “My analysis of Eskom’s financial position is that it will ask for annual increases of 17% or more for the next four years. And that is why we have to look for a way forward – because this is not good for the economy. I also believe that municipalities will start buying from private producers because it will cost them less than Eskom. So we have to think of ways to keep both the municipalities and Eskom sustainable. That means saying to Eskom that it cannot build any more because

SOUTH AFRICAN PROPERTY REVIEW

alternative energy we almost have enough electricity. As coal power stations go out of commission, Eskom must fill the gap with renewables so electricity becomes cleaner and there will be less need to increase the electricity price (because renewables are so cheap). “Nuclear commission is not in place and energy planning shows that it’s not required, but there are still people who want to do it although it is not the mathematical solution to the problem. We have one existing nuclear power plant that is nearing the end of its life, but it is not a very big part of the electricity system – it only supplies 1 800 megawatts out of 49 000-odd megawatts of electricity. I’m not sure if it can be repurposed, but that is really only important from a rehabilitation and environmental perspective, not from the electricity perspective. ““The policy decisions we are making now are critical, and the policy debate is often muddled. It’s often not based on the facts and there are many vested interests, so it’s really in everybody’s interest to make smart decisions,” he says. “At the moment, the cost of renewable energy sources at its lowest is around 50 cents per kilowatt hour. But the cost of the new coal from Eskom from the Medupi power station is around R1,10. Any safe nuclear power that can be built will cost around R1,50 per MWh or so, and the unsafe nuclear that possibly may be built (and has the same flaws as Fukushima) will also be R1,10 at least. These divergences are growing every year. It is not difficult to know what to do.”

Windaba 2016: Towards 100% Renewables Windaba is an annual conference hosted by SAWEA, where people come together to discuss the issues in the industry. It aims to take a long-term view towards a “30GW or more” wind industry – establishing what it would mean for South Africa, what needs to be done to get there, and what challenges would need to be overcome. This year’s theme is “Towards 100% Renewables”, discussing the two major changes in the last five years: the Paris Agreement, which says the world must totally decarbonise by 2050; and the fact that renewables have become increasingly cheaper over the past three years. Technical, policy, financial and operational topics that currently affect the industry will also be addressed. The conference takes place in Cape Town from 2 to 4 November 2016.

SOUTH AFRICAN PROPERTY REVIEW

SA renewables attracts R193billion in private investment In an effort to create a green economy, re-industrialise the country and add electricity to the grid, the government has set up a renewable energy procurement programme intended to bring long-lasting economic benefits to South Africa By Stanley Karombo

n South Africa, electricity remains a hotly contested topic, what with recent disruption in the sector and sharply rising tariffs. There is an ongoing discussion under way about what would be the lowest-cost generation mix, particularly in light of the country’s weaker currency. The dramatic drop in the costs of renewable energy has many questioning the further use of conventional technologies. South African renewables has attracted R193-billion in private sector investment, totalling a contribution of 6 327MW of capacity. Of this, R53,2-billion (28%) comes from foreign investment. According to Johan van den Berg, CEO of South Africa Wind Energy Association (SAWEA), renewables is responsible for the approximately 30% of all foreign direct investment in the country. “There is more than 1GW of wind energy connected to the grid, powering the equivalent of more than half a million South African households,” says Van den Berg. “Wind is a clean, sustainable, ‘renewable’ source of energy. The price of wind energy in South Africa is now more than 40% cheaper than new-build coal power. Using wind energy helps combat climate change by reducing pollutants from fossil fuel.” Although South Africa has had plenty of coal, there is huge growth potential in renewable energies. According to Van den Berg, the potential for wind energy in the country is estimated to be in the region of 40 000MW installed, and the solar potential is similar. This potential, he says, presents an investment opportunity to achieve a more ambitious target for renewable energy beyond the current targets contained in the 2010 Integrated Resource Plan (“IRP”), of about 19 000MW installed by 2030. The development of our renewables sector will be shaped by the country’s transmission infrastructure, which needs additional capacity, as well as the broader sovereign credit environment, it adds. According to Van den Berg, the expected growth of South

Africa’s green economy comes amid the uncertainty regarding the future of local independent power producers. Politically there have been a few delays, Van den Berg says, which have prevented the timeous progress of the programme. “But we are still incredibly proud of what has been achieved in such a short time and the scope for the future, with our ultimate goal being 100% renewables,” he says. “Unlike other power sources, wind energy development under the REIPPPP is completely funded by the private sector, so it doesn’t impact on taxpayers or rely on Eskom’s bank balance to be built. There are no risks of costs or time overruns for the consumer – the country only pays for the electricity at a fixed price for 20 years.” Notwithstanding the challenges, SAWEA says the industry is confident in its future. The wind sector has built and is now operating more than 500 wind turbines, with many more in various stages of development. The South African government was forced to carry out load shedding in early 2008 as a result of high electricity demand, dwindling energy reserve margins and maintenance that had to be carried out on a number of generators across the country. The mining sector, in particular, took a massive knock as they were forced to shut down for a period because the safety of miners underground could not be guaranteed with an intermittent power supply from the state-owned Eskom. Large energy consumers were requested to reduce their consumption by 10%, adding further strain to the industry. South African power needs 30 000 to 35 000 megawatts to be available, and the country’s reserves to keep the lights on stand at about three percent, Eskom Chief Executive Tshediso Matona told a news conference recently. “As long as the power crisis is with us, I don’t see how the country can manage growth and create jobs,” said Free Market Foundation economist Loane Sharp.

Eastern Cape energy mix

Energy-Mix creates jobs in Eastern Cape State-owned development company Coega Development Corporation (CDC) says energy-mix projects in the Eastern Cape have assisted in job creation and put an end to electricity outages By Stanley Karombo

Dr Ayanda Vilakazi, CDC Head of Marketing and Communications

he state-owned development company also believes that renewable energy production has allowed steady electricity supply in the Eastern Cape and will keep the lights on for some time. The Coega Industrial Development Zone (IDZ) has been regarded as a cog in the province’s chosen approach of a diverse energy mix. This is according to Dr Ayanda Vilakazi, Coega Development Corporation’s (CDC) Head of Marketing and Communications. “Through the Independent Power Producers Programme (REIPPP), R33,7-billion worth of renewable energy investments is being put into the provincial economy, with the potential of creating 18 132 job years,” says Vilakazi. From the REIPPP programme, he adds, the province has already showed vast opportunities and capabilities for the Eastern Cape in terms of wind projects. The project is being driven and managed at a provincial level by the Department of Economic Development, Environmental Affairs and Tourism.

“The CDC has seen a huge increase in energy projects over the past few years,” says Vilakazi. To date, at least three wind farms have been earmarked to be located in the Coega IDZ, and a further two existing open-cycle gas turbines currently in the Eastern Cape, with one operational in the Coega IDZ (Dedisa Power Peaking Plant) and Port Rex OCGT, located in East London. The construction of Dedisa Peaking Power by the consortium of Ansaldo Energia, Fata of Italy, GDF Suez (Engie), Legend Power, Mitsui and the Peaker Trust has seen the successful implementation of the Dedisa PPP, a R3,5-billion investment in the Coega IDZ that became operational in September 2015. In 2009, the CDC submitted a prefeasibility study for the CCGT project that highlighted key capacity and technical aspects as well as the matter of the layout of the plant. Currently, Vilakazi says, the CDC is in the process of doing an environmentalimpact assessment study on the three identified sites within the IDZ, with the estimated capacity at 4,5GW. Notwithstanding the challenges, the CDC believes the IDZ has the required space and infrastructure to support all of the region’s sustainable energy projects, as well as conventional power.

Vilakazi believes that the Coega IDZ has the capacity for the energy mix because the area is about 11 500 hectares in size and is divided into various zones

Vilakazi believes that the Coega IDZ has the capacity for the energy mix because the area is about 11 500 hectares in size and is divided into various zones. Furthermore, the CDC is located adjacent to the Port of Ngqura, which enables effective deliverance of components required for energy projects.

Black empowerment The CDC does have insight and control of available space and supporting infrastructure for both renewables and conventional energy, says Vilakazi. The CDC also has a mandate to support new entrants who aim to supply components and services for renewable and conventional power plants, and is encouraging the previously disadvantaged black- and women-owned companies to venture into their manufacturing. “The CDC’s vision is to be the leading catalyst for championing transformative socioeconomic development,” he says. “In supporting this vision, the organisation adopted a policy that sets a compulsory target of 35% small-, medium-sized and microenterprise (SMME) involvement in all of its construction projects.” Vilakazi is optimistic that the CDC – as envisaged within its mandate – is posed to create massive job opportunities and development for the Eastern Cape. The CDC supports and explores all energy sources, both renewable and conventional, with the objective of expanding various value chains – such as the manufacturing of energy components, skills generation and skills development. As a result of this, the CDC has strategically marked sites for various energy projects, including renewable energy projects. Vilakazi says that the Coega IDZ is already home to a CDC manufacturing facility and a lay-down area that stores various renewable energy components before they are transported to their preferred locations. SOUTH AFRICAN PROPERTY REVIEW

H2O

Western Cape: water stores hold steady Cape Town is supplied by 14 dams with a collective capacity of approximately 900 000Ml. Most of this capacity is provided by ﬁve large dams: Theewaterskloof, Voëlvlei, Berg River, Wemmershoek and Steenbras Upper and Lower. The remaining dams are much smaller and only contribute 0,4% to total capacity. The three largest dams are owned or managed by the National Department of Water and Sanitation Compiled by Mark Pettipher

ains in mid-October pushed further into the mountain catchments, resulting in both the Berg River Dam and the Voëlvlei Dam levels improving. The other dams, unfortunately, continued to lose ground. The total volume of water stored lifted slightly upwards to 62%. As reported by Boland News at the beginning of October, the overall water storage situation in the Western Cape was in balance, with inflows just matching outflows. Compared to the same time last year, the overall shortfall remained at 12%. Note that the total volume stored was 18% to 20% of capacity less than the minimum hoped for at that point of diminishing rainfall.

Can water be moved around between the dams? The dams in and around Cape Town form part of the Western Cape Water Supply System, which is an integrated and collectively managed system of dams, pump stations, pipelines and tunnels. In addition to servicing Cape Town, the system supplies water to towns in the Overberg and Boland, on the West Coast and in the Swartland area, as well as providing irrigation water for agriculture. The integrated system helps to optimise the use of water resources in the region because it allows water to be transferred between dams and catchment systems. Dams that are running low can be topped up from another source, and excess water flows in the Berg River in winter can be transferred to Theewaterskloof Dam for storage. During the dry months, the water is transferred back and released into the Berg River as required. Only certain dams are connected in such a way that water can be moved between them for storage levelling purposes. The connections are between:

SOUTH AFRICAN PROPERTY REVIEW

● Steenbras Upper and Lower dams (also used for 200MW electricity generation) ● Eikenhof Dam (on Palmiet River, used as a 160MW hydro-electricity plant) and Steenbras Dam ● Berg River Dam and Theewaterskloof Dam. The link between the Theewaterskloof and Berg River dams is the most important because these two dams hold almost 70% of all the water in the southwestern Cape system. A surplus in one dam can be moved to the other dam for storage until needed. Furthermore, they are on two different river systems: Theewaterskloof is on the Sonderend River, part of the Breede River catchment, while the other is in the Berg River catchment area, benefiting from two slightly different rainfall zones.

Does Cape Town reuse “grey water”? Cape Town reportedly processes 218-million cubic metres of waste water (out of 300+ million cubic metres of fresh water used) through 22 waste water plants annually. Of this, 21-million cubic metres are reused by municipalities, golf courses and industry. Potential use for another 10-million cubic metres has been identified. One of the big Steenbras Dam

limitations is that, because waste-water plants are mainly located close to sea level, few “grey water” storage possibilities exist. Thus “grey water” must be used almost as soon as it’s produced. Wider reuse would require a big investment in separate duplicate distribution piping systems.

Future plans In a telephonic interview, Cape Town’s Deputy Mayor Ian Neilson said the city was looking at ways of developing and increasing the Voëlvlei Dam and better utilising the water from the Berg River by putting in pumping stations and treatment plants. He also said there were moves to explore extracting ground water from Table Mountain’s sandstone formation: test boreholes have already been sunk and the city is running trials but there’s no timeline as to when the test will be completed. “Our dams being at 63% is of great concern to us,” said Neilson. “We appeal to everyone to consider their water usage. Even with water restrictions being put in place, we do not want to see a repeat of last year’s waterconsumption patterns. Should our water levels fall by a further 15% this summer, the restrictions will be much tougher than they were last year.”

H2O

Wet wet where? In KwaZulu-Natal, the drought is biting hard and deep. Even as the rain pours down, the effect is negligible beyond our gardens – particularly for hard-hit, crucial areas such as Richards Bay By Anne Schauffer

ater restrictions everywhere – between 15 (the Mgeni system) and 30% (Ixopo system) in most areas – but it’s the long-term forecast that is most disturbing. For Umgeni Water, the largest supplier of bulk potable water in KwaZulu-Natal and Ethekwini municipality, there’s a constant balancing act between supplying quality water to customers, water to all KZN citizens (Ethekwini’s vision statement) and, of course, the critical supply to commerce and industry. Areas such as Richards Bay will not be able to see through the winter of 2017 unless there is a significant increase in rainfall. Water authority websites are updated regularly, reflecting the dire state of the various water systems. Umgeni Water not only shows current percentages, but the potential “failure date” when, if nothing changes, the dam will run out of water. The Mgeni System consists of Midmar Dam (47% now, failure by September 2017), Albert Falls and Nagle Dam (47% now, failure by June 2017), and Inanda Dam (64% now, failure by October 2018), the north coast system of Hazelmere Dam (64%, failure by September 2017); and the Ixopo System (59% now, failure by September 2017). Not a pretty picture. Much of Ethekwini and uMgungundlovu, including Pietermaritzburg, receives its water from the Mgeni system, which has experienced below-average rainfall over the past 30 months, resulting in some of these dams remaining consistently at below 30% and 50%. Looking north, Mhlathuze Water supplies an area that covers about 37 000km², stretching from the uThukela River in the south, up the East Coast to the Mozambique and Swaziland borders, around Vryheid and back to the uThukela River. The dam levels are dire: Goedetrouw dam level decreased from 18,14% to 18%; Lake Nsezi level remained unalterably low; and Lake Mzingazi is at 44,88%. Commercial buildings have numerous systems that rely on water. Today – beyond what is legislated – engineers and architects are increasingly recognising the long-term cost saving in sustainable design, are often seeking green building certification, and are

committed to taking a corporate stance on sustainability and the finite nature of global resources. Water conservation – like energy – is being integrated into designs to a greater or lesser extent. An example is The Energy Water Performance tool offered by the Green Building Council of South Africa, included in the new Existing Building Performance tool and also available as a separate certification. The tool – sponsored by Growthpoint Properties – allows for the benchmarking of energy and water consumption in existing office buildings against an industry average. In KwaZulu-Natal, Royal HaskoningDHV (RHDHV) works extensively in water management. “KwaZulu-Natal’s catchment areas, on the whole, are experiencing critical levels of water supply because of the extended drought, with some catchments being in better shape than others,” says RHDHV’s Dominic Collett. “With the implementation of the northern and western aqueducts, supply is being provided to Ethekwini from Midmar Dam, although its water levels are falling. We are certainly not in a recovery situation. We’re in a severe drought, no matter where you are in KwaZulu-Natal.” Royal HaskoningDHV offices in Umhlanga are located in the 4-star Green Rated Growthpoint building. Collett says the lowhanging fruit for water conservation for commercial operators is not expensive. “In this building, we have water-efficient taps, which probably saves about 50% of nonaerated tap usage,” he says. “All our roof water goes into a large tank in the basement

and is pumped back into the toilet cisterns – this saves about 30%.” He speaks about the wisdom of installing smart metering: “That way, you can measure dynamically what’s going on in your building. It’ll alert you way ahead of your monthly bill that your consumption has rocketed and you have a leak.” Smart housekeeping is a good starting point in any business, whether it’s commercial, industrial or residential. Knowing precisely what your usage is, why it’s like that, and whether it needs to be like that is invaluable. Marco Kerstholt is a specialist in industrial water for RHDHV. “Changing the mind-set of users – getting everybody sensitised to water as a finite resource – is the most important issue,” he says. “Awareness is growing because of the drought, but people are not always aware of how water works. Because of that, they’re using too much. You have to ask yourself why you’re using so much water and whether you need it.” RHDHV’s diagnostic tool, Waterscan, enables its team to conduct what is ultimately a water audit. “We evaluate a company’s entire water consumption,” says Kerstholt. “We look at what’s happening in the factory and how much is used per process, then interrogate those processes. Do you need to use (so much) water? Can you reuse that water in another process with or without a treatment step. Then – if it’s possible – we scale it up for the whole factory to find out whether complete water reuse is possible.” Kerstholt has a few simple housekeeping tips, particularly in large areas – such as using spray guns instead of a hose to clean a floor.

Hazelmere Dam

SOUTH AFRICAN PROPERTY REVIEW

H2O The pressure is higher so it’s faster and more effective. In a factory where seal water is used for pumps, he encourages the use of automated seal water supply systems instead of opening the tap for seal water to the pump. “In the automated seal water systems, consumption is regulated on temperature, not on fixed volume of water, so far less is wasted,” he says. “Richards Bay is under the most stress, with large industrial consumers using about 130 megalitres per day. These companies are probably in the most dire need in the province because of the implications of industry shutting down. We’re already talking about transfer dams – transferring water from one scheme to another – but that’s a massive project that needs to be planned years ahead. It’s way too late for it to be a solution for now. You can do it for the future to become more resilient – but for now, it’s no good.” Explaining his company’s modus operandi, Kerstholt says, “We’re working on multiple fronts to support clients in securing water supply,

primarily through desalination and reuse as we did in the Southern Cape when it was declared a disaster area during the drought from 2009 to 2011 and dams reached critically low levels. The Mossel Bay Municipality, together with PetroSA, augmented the water supply with 15 megalitres per day of seawater desalination. Valuable raw water can now be diverted from its industrial processes for residential use.” For RHDHV, water reuse is often possible even when it seems unachievable. “For most, water is a utility, not the core reason why they operate,” says Kerstholt. It’s also cheaper than energy or chemicals.” By combining water saving with energy or even resources (such as chemicals or product), positive business cases are possible. RHDHV was called in to assist Mars B.V. – a multinational company know for its foodstuffs – with its “sustainable in a generation” vision (to be carbon neutral by 2040). Mars B.V. wanted to reduce its water consumption in one of its biggest waterconsuming processes in the factory

“The best option was treating the water that came out at the end of the process, representing a potential water recovery of more than 80%,” says Kerstholt. “The waste effluent stream consisted of water, glucose and particulate matters; by separating these, there was potential for reuse of the water and glucose, with the particulate as the only waste product.” The final result was a saving in this process of 84% of the water consumption, and 84% of the glucose. With a combination of water and glucose recovery, a positive business case could be achieved. Water reuse is the ultimate sustainable solution, and for commercial enterprises, it’s really no longer optional. From the affordability of restricted-flow faucets and showers, grey water systems, a water-wise indigenous garden and more, to the more complex systems, it all begins with an increased awareness by every single person in every office, every factory and every organisation, of water – and of its value.

A water crisis looms in Gauteng A water crisis is looming in Gauteng as dam levels continue to decline, authorities warn By Stanley Karombo

ne of Gauteng’s biggest water sources, the Vaal Dam, was recently at 30,1% capacity and losing about 0,8% every week, according to Sputnik Ratau, Director of Media Liaison at the Department of Water and Sanitation. The situation is so desperate that Ratau urges municipalities and consumers to use water sparingly, and warns that failure to do so will result in the dam’s level dropping by 25% by next month. “We have to work together to save the remaining water that we have,” he says. The precariously low levels of water in the dams were caused by two consecutive drought seasons, which have led to less water filling the rivers that usually supply the Vaal river system. More than 13-million people in Gauteng and parts of the North West and the Free State rely heavily on the Vaal River system, which supplies 14 dams. Rand Water, formerly responsible for the distribution of water in Gauteng, draws its purification water mainly from the Vaal Dam. Faced with declining water levels, Ratau says the department had gazetted a 15% restriction on water usage. However, consumers have failed to adhere to this. The restriction was gazetted on 12 August and implemented on 6 September.

SOUTH AFRICAN PROPERTY REVIEW

“We asked the municipalities to enforce the restriction on water usage, and consumers to comply,” he says. In a bid to assist the infrastructure of the Vaal River system, consumers need to reduce water consumption until the next rain season. The bulk of water in Gauteng is used for agricultural purposes, which make up 62% of the country’s water use. Urban domestic users are responsible for 23% and rural consumers for four percent, while power generation uses two percent. However, in Gauteng, 79% went to urban domestic use, nine percent to mining and other industrial activity, six percent to agriculture and five percent to power generation. Of the 79% going to domestic urban use, 40% went towards non-human consumption such as gardening and recreational activities, Ratau says. Last year at this time, the dam levels were reported to be at 75%. Vaal Dam

There has been a falloff in dam levels in all nine provinces, the department said, adding that a further falloff of about 10% before the onset of the summer rains can be expected. Of the 211 dams being monitored on a weekly basis, 12 are below 10% and 64 are below 40%. Only 18 are at 100%. Johannesburg Water has started issuing fines to people not using water sparingly. The Department of Water and Sanitation has said that dam levels have dropped by more than 20% since last year, and will continue to drop. Many consumers in Gauteng have taken heed to the call to save water. “We’ve been enforcing water restrictions and most people are complying,” says Tidimalo Chuene, Johannesburg Water Manager: Marketing and Communications. “We’re fortunate that Johannesburg Metro Police is monitoring the situation on the ground.”

SAPOA events One of SAPOA’s primary objectives is to define excellence in the property industry e award efurbIs hments InnovatIv r

As part of this objective, the SAPOA Property Development

Awards for Innovative Excellence provides public recognition for top quality design and functionality and a benchmark for excellence in property

Position your company as a market leader - reap the benefits from positioning as a champion of South Africa’s property industry, innovation and excellence. SAPOA awards

SAPOA awards

2016 for excellence

Winning a SAPOA Innovative Excellence Award provides members of the project team with a multitude of benefits.

136

SAPOA awards

2016 for excellence

for excellence

Don’t miss the opportunity of celebrating the success that results from determination and the resilience demonstrated by our industry in providing exceptional PROPERTY.

2016

SAPOA awards

for excellence

2016

Be part of these exclusive awards in the most prestigious property awards program in South Africa by submitting your entries for the 2017 Property Development Awards for Innovative Excellence. Entry fee: Queries: Entries closes:

R17,500.00 (excl VAT) Jane Padayachee marketingmanager@sapoa.org.za or 011 883 0679 15th FEBRUARY 2016

ONLINE REGISTRATION - www.sapoaawards.co.za GREEN SOLUTIONS – SMART MATERIALS FOR REAL ESTATE DEVELOPMENT Polyroads manufactures and develops environmentally friendly Smart Materials for the construction industry. These Smart Materials include in-situ material binders, soil modifiers, asphalt modifiers and elastomeric mortar admixtures. Smart Materials reduces construction costs by using smart binding technology to replace conventional building methodologies. ● ROADS, PARKING LOTS & DRIVEWAY CONSTRUCTION In many instances, in-situ materials can be used for the road’s base and sub-base stabilisation to construct the roads 50% faster and at half the cost, without sacrificing performance. Minimal maintenance over the years. Engineered designs. ● POLYMER ASPHALTECH ROAD SEALS Black or coloured, cost-effective road repair kits ● JOGGING & BICYCLE TRACKS Natural or various colours ● LINING ESTATE DAM AND PONDS Environmentally friendly, Koi dams, UV stable ● WATERPROOFING Waterproof roofs, structures (at least 30% less; 10-year warranty)

Contact t: +27 (0)11 868 1183 e: estate@polyroads.com w: www.polyroads.com

P LYROADS A DIVISION OF POLYMER PAVEMENTS (PTY) LTD

SOUTH AFRICAN PROPERTY REVIEW

sustainable developments

Crystal Lagoons’

sustainable, innovative technology Trends in real estate have moved towards environmentally friendly developments that use innovative technology to ensure sustainability. The need for such sustainable developments is further deepened by the global problem of energy and water scarcity. Multinational water and technology innovation company Crystal Lagoons is providing an amenity around the world that meets the need for innovative and ecofriendly development. Crystal Lagoons, a world-leader in green innovation, has a patented technology that allowed for the construction of crystal-clear bodies of water unlimited in size. These lagoons are not only shaking up the real estate market – they are also revolutionising current modes of energy and water consumption By Rebecca Jackman

Fernando Fischmann

Alastair Sinclair

SOUTH AFRICAN PROPERTY REVIEW

even years ago, biochemist, real estate developer and entrepreneur Fernando Fischmann was tasked with transforming a strip of coastline in Chile, which was completely unsuitable for swimming or sunbathing, into a recreational paradise akin to the Caribbean or the Bahamas. His initial attempt to create a crystal-clear lagoon failed. Instead of being defeated, Fischmann travelled the world in search of the technology that would assist in executing his vision. Upon the realisation that there was no such technology, Fischmann set out to invent it himself. It took him seven years, but he succeeded. Fischmann’s water innovation company Crystal Lagoons now has 400 projects in various stages of development in 60 countries, and its lagoons are widely considered the world’s top amenity. The sustainable and environmentally friendly technology is now patented in 160 countries. When included in property developments, the lagoons have contributed to exponential increase in sales prices and sales velocity, as well as an increase in project density. The San Alfonso del Mar development, for example, originally planned for 400 residential units, but the addition of the lagoon resulted in increased demand and the project expanded to 1 400 units. Crystal Lagoons have become highly desirable for developers in search of amenities that are both environmentally friendly and sustainable. The crystal-clear lagoons, of unlimited dimensions, use half the fresh water of a park of the same size and 30 times less fresh water than a golf course. They are also developed at very low construction and maintenance costs, and provide a sustainable solution for water

resources as they can use fresh, salt or brackish water (which has no alternative use). Crystal Lagoons’ technology allows for the utilisation of large tracts of undeveloped inland areas, and the conversion of less accessible parts of coastline. The lagoons are ideal for a wide range of recreational activities, including swimming, kayaking, paddle boarding and sailing – all within a safe environment – providing exceptional value

sustainable developments to real estate projects and to the people who want to live at the water’s edge. The technology was recently launched in the South African and broader African market. Advanced negotiations with local developers are already under way to create South Africa’s first Crystal Lagoon. PricewaterhouseCoopers’ “Real Estate 2020: Building the Future” report found that the global trend of innovative, sustainable and low-cost technologies is expected to continue in Africa. “A Crystal Lagoon makes good business sense in any development, increasing sales rates and prices to unprecedented figures,” says Alastair Sinclair, Crystal Lagoons’ Regional Director for Africa. “It has been shown to speed up sales rates by more than 70% and open up previously infeasible locations to development. “The Crystal Lagoons technology is environmentally friendly because it involves very low water consumption: the lagoons work on closed circuits, and only the water lost via evaporation needs to be replaced. In addition, by using Crystal Lagoons’ evaporation-control film technology, water lost to evaporation may be up to 70% less than with natural evaporation.”

Sinclair adds that the lagoons use far less energy than conventional swimming pool centralised filtration systems, which require maintaining high and permanent levels of residual chlorine or other disinfectants in the water to provide permanent disinfection to the pool and prevent contamination of the water by external agents. “Instead of filtration of its entire volume of water between once and six times per day, Crystal Lagoons’ solution is to apply a combination of different ultrasonic waves to the water in the lagoon, which allows the agglomeration of contaminant particles into larger particles that are easily removed from the system,” Sinclair explains. Crystal Lagoons’ technology allows the use of surplus energy in other industrial processes, such as water desalination, heated-water generation for residential and industrial use, greenhouse heating, home heating systems, wood drying systems and industrial preheating. This way, Crystal Lagoons’ technology contributes to local economic development and to the reduction of CO2 emissions. This innovation also enables the development of crystal-clear lagoons for leisure, thus making possible the construction of heated poollike beaches that can be used all year long,

anywhere in the world, and at very low construction and maintenance costs. Furthermore, Crystal Lagoons has recently focused on solving some of the most critical problems of humankind, such as water and energy scarcity. Fischmann has developed the technology for application in desalination, with an energy-efficient process set to have an enormous impact on water-scarce areas. “Sustainability is a key factor driving all new developments in Africa, and Crystal Lagoons’ technology is of huge benefit to a country such as South Africa, where both water and energy are scarce resources,” says Sinclair. For his work in developing industrial applications that solve worldwide problems, Fischmann was recently honoured by the International Business Awards. He was named “Innovator of the Year”, while the patented Crystal Lagoons desalination technology was awarded the “Energy Industry Innovator of the Year”. Fischmann is also one of the five finalists for this year’s Real Innovation Award, organised by the London Business School. BELOW San Alfonso Del Mar in Chile is an ocean-front resort known for its massive pool, apartments with balconies and private beaches

SOUTH AFRICAN PROPERTY REVIEW

(LEFT PAGE) DPS AD - BLUEPRINT.pdf

7/25/16

SAPOA events

SOUTH AFRICAN PROPERTY REVIEW

7:55 PM

SAPOA events

SOUTH AFRICAN PROPERTY REVIEW

29 91

people in profile advertorial

Game changer Knowledge and experience count for coatings that last, taking Versus Paint to the top of its game

Babette Mattheyse, Versus Paint Commercial Director, Eastgate – New entrance at Woolworths

Mall of Africa

SOUTH AFRICAN PROPERTY REVIEW

he Versus Paint family has more than 180 members, all committed to the brand. At the helm of the company’s commercial sector, Commercial Director Babette Mattheyse runs a tight ship. She has more than 28 years of experience in the building industry, with her specialty being substrate coatings. Her vast technical knowledge on substrate coatings has been achieved through her involvement in a number of high-profile contracts in different environments and countries. She has been influential in creating products to meet specific client needs and her successes range from small commercial projects to 6-Star Green rated buildings and the Department of Environmental Affairs – Design. In fact, her passion lies with sustainable building. “We have an obligation to the children of this plant to create and develop more mindfully,” says Mattheyse. “As stakeholders of the building industry, we’re best positioned to see the bark from the trees and to take the lead in living responsibly. A journey through the chemical world of the coating industry, practical incidents on building sites and the continuous pressure from shareholders to receive an excellent return on their investments, will make you realise just how much influence and power you as a professional really have.” Ecofriendly paint alternatives are an important aspect of Versus Paint’s offerings. The company has formulated wall coatings that considerably decrease the amount of damage done to the immediate environment and the environment as a whole. “I believe the true value of our profession can be measured in the kind of decisions we make,” says Mattheyse. “My wish for this industry is to base decisions on the concept of ‘mindful living is more green’.” Versus Paint’s commitment to the use of sustainable products has put it in good stead with many of South Africa’s developers and architects. As such, the company has been involved in several high-profile projects including Menlyn Park Shopping Centre, Dainfern Shopping Centre and Illovo Edge. A significant project undertaken by Versus was the refurbishment of Eastgate Shopping Centre in eastern Johannesburg. “The building was a bit of an old lady – but it was worth it to rehabilitate the existing structure rather than demolish it,” explains Mattheyse. The main concern of running the project was the challenge of working on many different façade materials of different ages. Versus undertook all the remedial work on the existing structure before it could be coated

people advertorial in profile

Mall of Africa

to give the entire building a new, fresh look. Mattheyse says that as fussy as it may seem, the Versus team is very particular about ensuring the surfaces to which coatings need to be applied are sound before any coating work is done. “Versus guarantees all its work, so getting the basics right is critical in order for the final coating to perform properly and look good.” Versus also just completed the exterior coatings on the newly opened Mall of Africa in Midrand, a large, highpressure project. The company applied about 25 000m² of coating to the structure in a fast-track timeline of approximately three months (compared to about 22 000m² at Eastgate, which had taken almost a year). “A new-build project is far easier to do compared to restoring a shopping centre while keeping it open for trade,” says Mattheyse. “While the company’s knowledge and expertise come to the fore in complicated situations,

Eastgate – Cinemas

it was exciting to be appointed to a high-profile project such as this one.” A third large shopping centre that Versus is currently working on is Menlyn Park in Pretoria. This shopping centre is undergoing a massive remodelling, and Versus has been applying coatings on parts of the interior – particularly the massive central atrium. Here, work has to be done at night because the centre must remain open to shoppers during the day. This has presented various logistical and staffing challenges, but Mattheyse’s team has risen to the challenge. Other significant projects include Menlyn Maine Projects Pretoria, Sage VIP, Nedbank, Pegasus, Maxwell Office Parks, Alexander Forbes, Sasol, Discovery (Current), Rosebank Towers and Nelson Mandela Children’s Hospital. Versus is well established in the South African market. Mattheyse says the next step is to expand further into other parts of Africa.

The company has already undertaken a few projects in Mozambique, Zambia and Swaziland (such as the MVAF Building and the New Swaziland Airport), and now works with a Swazi and Zambian company, which is licensed by Versus to apply its products. Members of the South African team interact regularly with these teams and are on site to help inspect the quality of substrates as well as the work itself, and to train the team over time. This is a model that the company would like to replicate in other countries, passing on skills and knowledge to local people while growing the Versus brand. “It takes time for people to understand that the coating is only as good as the hands that apply it and the surface onto which it is applied,” says Mattheyse. “It takes education in the market to get people to understand how important it is to have a good substrate for a coating which, while more expensive in the short term, will be cost effective and will perform well in the long term.”

Mall of Africa Food Court

+27 (0)11 885 3136 info@versuspaint.co.za www.versuspaint.co.za SOUTH AFRICAN PROPERTY REVIEW

Menlyn Maine

Menlyn Maine:

the country’s first “green city” precinct A R1,8-billion mixed-use development, Menlyn Maine district of Tshwane is the country’s first “green city” – and the precinct opened its doors to the public in September By Stanley Karombo

“Many of Central Square’s retailers and restaurants are like-minded in prioritising sustainability, including our large grocery stores Spar, Pick n Pay and Woolworths. With sustainability leaders coming together in a single green city, Central Square has become a very exciting platform for collaborative environmental innovation. This has exponential positive impacts”

SOUTH AFRICAN PROPERTY REVIEW

entral Square at Menlyn Maine introduces some of South Africa’s most environmentally friendly, customer-friendly and innovative shopping experiences. The new, vibrant mixed-use 65 000m² Central Square at the heart of the iconic 315 000m² Menlyn Maine is set to decentralise green city mega development. It is designed to have positive impacts on both the environment and the people who use it. Menlyn Maine is South Africa’s first green mixed-use city precinct. As a partner of the Clinton Climate Initiative, Menlyn Maine is one of 16 green cities being built in various countries, and the only one in Africa. In line with Menlyn Maine’s exceptional sustainability benchmarks, all buildings in

the precinct are set to have a 4-star rating by the Green Building Council of South Africa (GBCSA). The precinct is also targeting a LEED ND certification for the precinct. In an industry first for South Africa, Central Square at Menlyn Maine has achieved a Green Star SA Custom Mixed Use rating from the GBCSA. Central Square is co-owned by joint investors Menlyn Maine Investment Holdings and the Government Employees Pension Fund (GEPF), represented by the PIC. It will introduce a compelling offering of 30 000m² boutique-styled mall of exceptional, development with more than 50 hand-picked retailers, restaurants, and entertainment experiences – the perfect place for daily convenience shopping with a difference.

Menlyn Maine Many of Central Square’s tenants share its sustainability ethos. “Central Square’s retailers and restaurants are like-minded in prioritising sustainability, including our large grocery stores Spar, Pick n Pay and Woolworths,” Henk Boogertman, Architectural Director of Menlyn Maine Investment Holdings (Pty) Ltd told South African Property Review. “With sustainability leaders coming together in a single green city, Central Square has become a very exciting platform for collaborative environmental innovation. This has exponential positive impacts. People can shop, dine and unwind at Central Square with full confidence that, by choosing Menlyn Maine for everyday activities, they are being kinder to our fragile planet while enjoying a world-class experience. The design of Central Square articulates the Menlyn Maine vision to create a modern, new urban city precinct, where everything is right on one’s doorstep and people can live full, balanced, responsible and exciting lives in a safe, secure environment.” Central Square’s other in-store initiatives include collection points to recycle light bulbs, batteries, plastic bags and ink cartridges, and enterprising recycling initiatives, many of which will create opportunities for employment. The next major development for the node is the extension of Menlyn Park shopping centre, which will become the largest shopping centre in Africa, usurping Durban’s Gateway Theatre of Shopping. It will also be larger than its Gauteng neighbours, the

“Spirit of Tshwane” sculpture “Tshwane” is the local word for the Apies River. The river is symbolised by the flowing elements attached to the heads. The other meaning attached to the word is “We are one because we live together”. This is symbolised by the two main heads growing from each other. The heads are cracked open so there is a lot of space for light to come in. When light comes in, there is growth – hence the different small faces popping out of the cracks, representing the people of Tshwane. Anton Smit of Anton Smit Sculptors believes we need faith, hope and love, and we need to express them to one another, making them the basis of our national pride. On a lighter note, this is the “unbearable lightness of living in South Africa”: it’s so light you just want to stay here. The thought process is to create lightness. Smit wants people to identify with the piece and see humour and playfulness in it, as well as the diversity of our urban landscape.

iconic Sandton City and the recently opened Mall of Africa. Menlyn Park, owned by private company Pareto, is being extended by 50 000m² at a cost of R2-billion, including refurbishments of parts of the centre. The super-regional mall will measure 169 253m² by November, and contain about 500 stores.

Menlyn Maine will also be home to a residential quarter, offices, the Sun International Time Square casino, a park, a five-star hotel and an 8 000-seat multipurpose arena development. According to Boogertman, the rest of the precinct will take no more than five years to complete at a cost of about R10-billion.

SOUTH AFRICAN PROPERTY REVIEW

sustainability in focus

Focus on promoting sector, sustainable technology use The newly appointed Chairman of SAPOA’s Sustainability Committee, Josef Quraishi, is eager to promote the South African property sector locally and internationally, and to advance the use of sustainable technology within the sector By Stanley Karombo

Josef Quraishi, Chairman of SAPOA’s Sustainability Committee

“Water-supply shortages are currently dominating our attention, and it is the lack of another essential utility and natural resource that has reinforced the need for more efficient and effective design and development” 38

SOUTH AFRICAN PROPERTY REVIEW

ew regulations and their impact continue to be a focus for SAPOA’s Sustainability Committee. Regular engagement with government departments, state utilities and major municipalities provides the Committee with great insight ahead of policy decisions, says the Committee’s Chairman Josef Quraishi. “It also provides the opportunity to review, comment on, lobby (if necessary) and disseminate any aspect of legislation deemed to impact the South African property industry,” he says. Capitalising on an incredible network of professional members and industry leaders will also continue to prove key to the effectiveness of the Committee, providing a platform for the support and encouragement of education at all levels across South Africa. A notable comment made by the Dodge Data and Analytics survey highlighted how “one of South Africa’s biggest challenges is finding skilled/educated green professionals”. “Together with our members and our partners, we will resolve that challenge and endeavour to support a resilient South African property industry,” says Quraishi. Quraishi is Head of Sustainability for the Amdec Group, and with a Masters in Architecture and Sustainability laterals from the UK, he is also a technical adviser to the Green Building Council of South Africa.Holding a number of Green Star ratings in South Africa, he has also assisted in the development of the Multi-Unit Residential Tool and Socioeconomic category and has played a strategic role in the development and masterplanning of the sustainable precinct, Melrose Arch over

the past eight years. Having also held the title of Development Manager, Quraishi certainly has a very unique perspective of the private property sector. When asked about how sustainability has fared in the property sector over the past few years, he says that South Africa’s property industry has responded more positively to sustainability in the shortest period of time than possibly any other country to date. “If one uses the Green Building Council as a means to evaluate the quantum of formally certified green buildings, it is evident that since its introduction to South Africa in 2007, the Green Building Council of South Africa (GBCSA) has achieved in excess of 200 certified buildings and spaces,” he says. “In addition, there are many projects still in the registration process. “By using the GBC’s global method of certifying green buildings, South Africa is highlighted as certifying more green property in a shorter period of time than any other country to date.” According to Quraishi, it is also important to note that the property industry has made greater moves in developing sustainable property than that merely recorded (certified) by the GBCSA, whether it be in reference to new buildings or retrospectively to existing buildings. Quoting the “World Green Building Trends 2016 SmartMarket Report” published this year, he says South Africa is the country with the “highest green share of any country” and “with impressive growth expected”.

sustainability in focus “It is encouraging to see the commitment to green buildings made by the property industry in South Africa (both retroﬁts to existing buildings and new builds). It has been recognised by the World Green Building Trends 2016 SmartMarket Report, which predicts that ‘South Africa will be a leader in the global green market in the next three years’” Intriguingly, the Dodge Data and Analytics survey reported that one of the top three triggers for developing sustainable buildings in South Africa was the understanding that it is simply the “right thing to do”.

What is sustainability in property? “While ‘doing the right thing’ is certainly commendable, it is clear that economic forces determine sustainable development – and there are still many smaller pockets of the property industry that believe sustainable development comes with great (unnecessary) expense,” Quraishi says. He explains that the property industry as a whole has seen profitability and income generated by sustainable investment increase in a shorter period of time than ever before. A research by the MSCI and Independent Property Databank of South Africa notes how “green-certified” and more energy-efficient buildings are proven to be better investments, typically generating a higher income return and a higher capital value per square metre, with lower vacancy levels overall and a lower level of capital expenditure than a more “conventional” building. “Of course, as with most typical business models, the increase in market demand for ‘green’ space, together with environmental regulations, has led to greater development of a supply chain and increased awareness, education and understanding in the market, which in turn fuels demand for this type of space,” he says.

While this business chain ensures that sustainable initiatives become more cost-effective, when you combine this with vulnerable state power and water supply, tightening environmental legislation, tax incentives and a market that’s seeing progressive financial institutions offering preferential ‘green’ funding solutions, Quraishi says it becomes clear that any business in the property industry that finds reasons not to adapt to this sustainable environment will see its product become increasingly less desirable and its potential for greater profitability diminish.

Looking into the future While the concern over uninterrupted state energy supply has faded somewhat from the forefront of the media and the public mind, the impact it had on the property sector is still evident – and it’s an issue all sectors of the industry are seeking to avoid experiencing again. Whether it be as a result of risk mitigation or the security of avoiding unpredictable energy price spikes, industry leaders in South Africa have certainly learnt from any total dependency or previous complacency, Quraishi says. “Water-supply shortages are currently dominating our attention, and it is the lack of another essential utility and natural resource that has reinforced the need for more efficient and effective design and development,” he says. He notes that in terms of the greatest sustainable moves in the industry, “We should shortly witness a move towards more holistic property developments, and the rise of walkable mixed-use precincts that have the potential to maximise the efficiency of energy and water usage, rather than buildings in isolation.” When combining the (inevitable) introduction of energy performance certificates and carbon tax in South Africa, with legislation such as SANS 10400 XA, SANS 204 and guidelines such as the King III Report, there is unquestionably recognition in the industry that sustainable development in South Africa has to become the norm, not the exception, he says. “It is therefore encouraging to see the commitment to green buildings made by the property industry in South Africa (both retrofits to existing buildings and new builds),” he says. “It has been recognised by the World Green Building Trends 2016 SmartMarket Report, which predicts that ‘South Africa will be a leader in the global green market in the next three years’.” SOUTH AFRICAN PROPERTY REVIEW

SAPOA events An opportunity

I nnovatIve C orporateaward offiCe developm offICe

ents

PROPERTY DEVELOPMENT AWARDS FOR INNOVATIVE EXCELLENCE

not to be missed The SAPOA Property Development Awards for Innovative Excellence coffee table book 2017

2 0 1 6

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

2 0 1 6

Every year, buildings get smarter and more beautiful. SAPOA’s primary objective is to define excellence in property and recognise top-quality design and functionality as a benchmark for excellence. SAPOA awards for excellence 2016

award Ivehments refurbIs Innovat award vehments refurbIs InnovatI

e Park Lion Match OfficRoad, Durban

award hments Ive efurbIs Innovat r

pment l combination of park is a wonderfuOffice Park is a redevelo The now-26 000m²he Lion Match and se various other medical facilitieshas rejuvenated an old warehou office space, cafes, project that a new parking redevelopment included l commercial space. services. The space into refurbished in its according to provincia building, designed a heritage keeping site and is unique garage and a new The property is ents and in such, As requirem ks. AMAFA’s landmar andlineiconic heritage agency with views railway l architec e theture historica alongsid formed the basis have been design with the area. Nestled has building the newble fields,sustaina history rugby and of the ocean and of the project. contained a mixture a highlight of the project. d between property positione well000m² Park is 21 Officeoriginal The Lion MatchThe The year 2013 saw and major facilitiesl space. transport and industria , close tocial of commer into an urban Durban’s stadiums Mile”. pment of this space city’s redevelo the of the“Golden the tostart routes, and central

ent.

business environm

Surveyors JT Ross, MLC Quantity JT Ross Quantity surveyors Mechanical Project managers May Houseman & Associates s Dean Jay Architects Quantity Surveyors l engineers Hatch Goba, Developer JT Ross Architect consultants Dynamic surveyors JT Ross, MLC & Associates Structura s BFBA Consultants Fire Mechanical Goba, May Houseman managers JT Ross Quantity n Electrical engineer Civil engineers Hatch May Houseman & Associates Dean Jay Architects Project r JT Ross Constructio l engineers Hatch Goba, r JT Ross Architects Principal contracto nts Dynamic engineers BD&O, AECOM Fire Solutions, AECOM

Develope consulta & Associates Structura s BFBA Consultants Fire Goba, May Houseman Electrical engineer Civil engineers Hatch r JT Ross Construction Principal contracto engineers BD&O, AECOM Fire Solutions, AECOM

SAPOA awards

The SAPOA Property Development Awards for Innovative Excellence are widely respected within the commercial property design industry, illustrating various types of excellence, from the clarity of purpose in the brief to ingenuity of product, clever design solutions and delivery on time and within budget. 892 Umgeni

892 Umgeni

redevelopment Office Park is a he Lion Match warehouse rejuvenated an old project that has ed commercial space. space into refurbish is unique in its heritage site and The property is a As such, iconic landmarks. and ure historical architect formed the basis ble design have history and sustaina of the project. d a mixture property containe The original 21 000m² 2013 saw l space. The year industria and ial of commerc into an urban pment of this space the start of the redevelo ent. business environm

tion of ul combina SAPOA awards for excellence 2016 park is a wonderf The now-26 000m² and various other medical facilities office space, cafes, a new parking pment included al services. The redevelo according to provinci building, designed garage and a new in keeping and ents AMAFA’s requirem heritage agency line with views alongside the railway with the area. Nestled has been fields, the new building rugby and of the ocean a highlight of the project. ed between Park is well position The Lion Match Office t facilities and major s, close to transpor Durban’s stadium Mile”. to the city’s “Golden routes, and central

for excellence 2016

SAPOA awards

for excellence 2016

It is this recognition that owners, developers, architects and property practitioners strive for.

2016 rds for excellence

SAPOA awards

for excellence 2016

Cost: R15 000 excluding VAT (Includes design, photography and production) Deadline: 08 April 2017 Bookings: Jane Padayachee, Marketing Manager e: marketingmanager@sapoa.org.za t: +27 (0)11 883 0679

A SAPOA award is forever, much like the raw bricks and mortar that make up the timeless beauty of property. To be part of this amazing opportunity, partner with us by profiling your executives and/or team in our SAPOA Property Development Awards for Innovative Excellence Coffee-Table Book Volume 4

Volume 4 of this prestigious coffee table book will be given to each delegate attending the SAPOA Convention & Property Exhibition ● ●

20 - 22 June 2017 Cape Town International Convention Centre

SOUTH AFRICAN PROPERTY REVIEW

s●

monthly cou n Our

Th e WOR

erie

son thes world D eye ● L

by-country focu try-

Nordic delights The design of the Norwegian flag with the Scandinavian cross in the centre is similar to other Nordic flags. In the case of Norway, the cross is blue with white framing, placed on a red background. The cross is not isosceles and reaches the edges of the flag, and the shorter arm is located closer to the left side of the flag. The flag is similar to the Danish Danneborg, which reflects four centuries under Danish rule. On the other hand, the blue cross points to long-term ties with Sweden. The flag was designed in 1821 by Frederick Meltzer, but it was not adopted as a state flag until 1898. The colours of the flag that coincide with the French tricolour, and could be interpreted as an expression of the desire for independence that Norway did not reach until the beginning of the 20th century.

Key facts ▼ Country Norway ▼ Capital city Oslo ▼ Population 5 109 056 (2014) ▼ Total area 385 155km2 ▼ Formation 7 June 1905 ▼ Highest point Galdhøpiggen (2 469m) ▼ GDP US$388-billion (2015) ▼ Currency Norwegian Krone (NOK) ▼ Code NO (NOR) ▼ Calling code +47

After several downwards revisions, the 2015 Norwegian GDP growth ended at 1,5 %, which is close to the estimate in our previous report. Estimates for 2016 were also relatively unchanged at 1,8%. The oil industry is still shedding jobs, but with the exception of four counties, employment in Norway is still rising Compiled by Phil Ruimte

he Akershus Eiendom annual survey of relocating trends in the office market shows a similar pattern to previous years. It is, however, Oslo’s CBD that experienced a flight of tenants to fringe areas, mainly because of a lack of suitable space in the CBD. Office rents in most of Oslo are marginally lower at the start of 2016 compared to last year, and in the western fringe they are between 10 and 20% lower. The volume of new signed leases was almost unchanged for 2015 in comparison with 2014. The expected volume of new office buildings in Oslo for the years 2016 to 2017 is at a record low for a two-year period. Oslo office vacancy peaked at 8,5% in July 2015, and was at 7,5% in January 2016. This is the result of low net construction volumes, and a slow but steady growth in demand in the Oslo market. The 2015 transaction volume, at NOK118-billion, was an all-timehigh volume by almost 50%. Several factors contributed to the solid volume; not all are equally present going into 2016. Prime yield estimate was down to four percent. Low interest rates have persisted, but higher margins appear to make this the bottom yield level. In 2015, sales volumes were strong in the secondary cities of Stavanger, Bergen and Trondheim. The office leasing markets were weaker than Oslo’s (especially in fringe markets) because of supply and demand reasons. Norwegian consumer consumption has been stable throughout 2016, although consumer confidence is still pretty low.

Retail rents are mostly stable but the Oslo high-street top rent declined for the first time in seven years. The retail transaction market has been very active, and all types of retail property have been sold. A solid trend in hotel revenue continued throughout 2015 with a six percent year-onyear growth rate in volume of guest nights. The logistics leasing market has not been affected by the slowing economic growth, although some industrial properties in the western part of Norway are likely to have taken a hit. The demand for long-leased properties in the transaction market has been solid. The growth in residential sales and prices throughout 2015 appears to have slowed down. As of February this year, prices are marginally down from last January, and 4,4% higher than one year ago – a lower yearon-year growth than all of 2015. Oslo had 11% price growth for 2015, and most other cities noted growth of between five and 10%. Stavanger, however, saw a one percent decrease in prices.

Overview of Nordic countries’ (Norway, Sweden, Finland, Denmark) office markets H1 2016 showed a slightly inconsistent market situation in the Nordic countries, though with a few common factors. According to Fredrik Kolterjahn, Head of Research at JLL Sweden, investor interest in prime property has remained strong, which has continued to push yields downwards in several sub-markets. Long-term, stable revenues, for example from

SOUTH AFRICAN PROPERTY REVIEW

eye on the world public tenants, are highly valued in the market, especially in countries with uncertain economic prospects such as Denmark and Finland. The prevailing low-interest-rate environment in all the Nordic countries has ensured that property investment has remained relatively inexpensive, but the deteriorating financing situation is starting to impact the market, particularly in Norway. Demand for modern locations in the office rental market has also been robust. All the Swedish office rental markets have performed well, and the consistently high demand has resulted in rental growth and stable, low vacancy rates during the first half of the year. Activity has been particularly brisk in Stockholm, where prime rent has increased by 29% year-on-year. Prime Stockholm CBD office rent is SEK 5 800/m², although there have been a few examples of lettings achieved at rents significantly above this level, which bodes well for continued rental growth. In Copenhagen, demand for prime property has been buoyant, which has led to a reduction in the vacancy rate and rental growth during the period. However, it has proved difficult for secondary stock to attract tenants, which has led to additional investment, either in property renovation or office-tohousing conversion. The Oslo office rental market, which had been under severe pressure in the past year or so as a result of the oil crisis, appears to have

stabilised slightly. The vacancy rate in the worst-affected sub-markets fell during H1 2016, with the limited supply of new office space as one of the contributing factors in this trend. The weak Finnish economy has begun to recover, although this is not yet reflected in the Helsinki rental market, where most tenants have remained cautious about relocation. Prime rent in Helsinki has remained relatively stable as a result of a number of major renovation projects, but secondary space is struggling to compete in the market, and the vacancy rate has continued to rise. The prevailing low interest rate environment has fuelled the investment market for several years, with the low cost of borrowing a prerequisite for many of today’s real estate transactions.

Focus on Oslo The Oslo office building stock, including Lysaker/Fornebu, today stands at around 8,6million square metres. Of the total volume, roughly 3,3-million square metres are situated within the city centre. The city centre office areas are marked in the map as seven areas/ circles, from Solli Plass in the west to Bjørvika in the east. Since 2007, the city centre has seen major urban development. Two new neighbourhoods at the waterfront, Tjuvholmen and Bjørvika, have been redeveloped to become mixed residential and commercial areas.

Market indicators Market outlook Prime rents

Stable in the short term, with a moderate growth potential in the CBD by the end of 2016

Prime yields

Strong investor sentiment is applying downward pressure on prime yields in the medium term

Supply

Vacancy should continue to improve in light of the mere 75 000m² of anticipated new, albeit two-thirds pre-let, supply in H2 2016

Demand

Sustained demand and activity patterns expected in the short term

Prime office rents: June 2016 LOCATION Oslo

NKR SQUARE METRES YR

€ SQUARE METRES YR

US$ SQUARE FEET YR

GROWTH % 1YR 5YR CAGR

3 900

420

43,3

1,3

2,2

CURRENT Q

LAST Q

LAST Y

HIGH

10 YEAR LOW

4,35

6,75

Prime office yields: June 2016 LOCATION (FIGURES ARE NET, %) Oslo

With respect to the yield data provided, in light of the changing nature of the market and the costs implicit in any transaction, such as financing, these are very much a guide only to indicate the approximate trend and direction of prime initial yield levels, and should not be used as a comparable for any particular property or transaction without regard to the specifics of the property. Source:Cushman & Wakefield, Norway Office Market Snapshot, Q2 2016

SOUTH AFRICAN PROPERTY REVIEW

Bjørvika still has the potential for further large development projects, and in the longer term, Filipstad just west of Tjuvholmen will be available for massive commercial and residential development. Generally, Oslo has a great deal of urban sprawl, and the built-up area covers significant land areas compared to its population size. Most of the office building stock is concentrated in densely built areas, and this is visible in the map. Office zones outside the CBD are generally found along the outer ring road from Lysaker through Nydalen, Økern and Helsfyr-Bryn to Ryen. All areas have seen new development over the last 10 years, and Fornebu and Nydalen have seen the highest activity. The area between the CBD and the outer ring road (on the map seen as the inner city west, north and east) is mostly in use for residential, education and retail purposes. The west of Oslo contains high-end residential areas with low density. The northeastern corner is the core area in all of Norway for logistical purposes, with many distribution centres for retail, wholesale and third-party logistics companies. Eastern and southern areas mainly consist of residential areas with varying degrees of density. In most areas outside the major office hubs, we see slow but steady conversion of older office buildings into residential development projects because these are generally more profitable than refurbishment for continued office use. The overall vacancy rate in Oslo decreased slightly by 50bps because of a decline in the vacancy rate in the western fringe of Oslo, in Lysaker and Fornebu. It is expected to see a further vacancy rate decrease as a result of a limited amount of new build and a consistently high conversion rate of older, inefficient office space for other uses. Demand for office space stayed at a normal level during H1, although a number of major leases are due to expire in the next few years. It is expected that several of these tenants will take up new space during 2016. The investment volume for H1 has remained at a reasonable level compared to what one would consider a normal year, but it amounted to less than half the volume of H1 2015. Part of the reason for this has been the scarcity of available prime real estate, coupled with low numbers of major portfolio transactions so far during 2016. It has also been slightly harder to obtain financing, especially in the case of secondary properties. We are expecting the total transaction volume for 2016 to end in the region of NOK75-billion.

eye on the world

Several large tenants expected to sign during 2016 During H1 2016, a total of approximately 285 000m² of office space has been taken up in the Oslo region (including renegotiations), which is about the same as H2 2015 and slightly more than the equivalent period last year. So far during H1, three tenants have signed for new office space close to or larger than 10 000m² in area, and as we predicted in previous reports, we are expecting several more major tenants to take up new space during the remainder of 2016. The existing leases of numerous large tenants are due to expire in the next few years, and many are pursuing new space rather than renegotiating their current contracts. Expansion plans and/ or inefficient space usage are two of the common explanations for this trend.

Rents stabilising after a slight decline Rental levels in most sub-markets declined slightly during H2 2015, especially in the western fringe, but these have now stabilised and have remained unchanged during H1 2016. Prime rent has been stable at NOK4 200 per square metre per year as a result of scarcity of supply and a healthy demand for CBD office space. Going forward, we are expecting rents to remain stable in all submarkets, and the worst impacts of the oil downturn in the western fringe to recede. From a longer perspective, we believe that rents will actually increase in the next few

8% 7% 6% 5% 4% 3%

Yield (country average)

Yield (prime)

Rental growth (prime)

Rental growth (country average)

Jun ’06

Jun ’08

Jun ’10

years because of a scarcity of new space and a high rate of office space conversion to other uses, which will limit supply.

Investment market: slower, but still good The total transaction volume for H1 2016 ended at NOK26,6-billion, which is less than half the volume achieved during the equivalent period last year. However, the investment volume is still high compared to what one might consider a normal year. Interest rates have continued to fall during 2016, in line with the reduction of the Norwegian Central Bank’s key policy rate, which now stands at 0,5%, while the 10-year SWAP rate stands at 1,31% (1 July). The prime yield estimate has been reduced during Q1 2016 and now stands at four percent. Foreign investments in the Norwegian commercial real estate market were a major factor in the higher investment volume in 2015, but during H1 2016 foreign investments have only accounted for 15% of the transaction volume. This has mostly been because of the lack of prime properties, as well as the large number of portfolios acquired by foreign investors in 2015, which we have not seen so far this year. The largest transaction during H1 2016 has been Entra ASA’s acquisition of three properties at Skøyen for NOK2,5-billion from Norwegian Property ASA. The largest single-asset transaction has been the sale of Statoil’s regional HQ at Fornebu by Madison International Realty to a closed-end fund for approximately NOK3,9-billion. Due to the more stringent equity requirements of the Norwegian banks, we may experience a decline in the total transaction volume for 2016 compared to 2015, as financing has been more difficult to obtain. This is especially the case for secondary and/or smaller properties. Our estimate for the total 2016 transaction volume is approximately NOK75-billion.

Jun ’12

Jun ’14

Jun ’16

80% 60% 40% 20% 0% -20% -40%

Rental growth(y/y)

During H1 2016, the total vacancy rate in the Oslo office market has decreased by slightly more than 50bps to 7,5%, which is the equivalent of 640 000m² of vacant office space. Since our last report, vacancy rates in the CBD and Oslo outer city east/north/ south sub-markets have remained stable at six percent and 9,1% respectively, and the vacancy rate for the Oslo inner city submarket has decreased to 3,3%, down 50bps from H2 2015. Despite the turbulence in the outer city west because of the “oil crisis”, the vacancy rate has dropped from 12,7% to 10,2% during H1 2016. This has primarily been because of Moteforum (fashion arena) signing for approximately 9 000m² of space at Fornebu. There are currently only five premises larger than 10 000m² vacant in the Oslo market. We are expecting the overall vacancy rate to remain stable for the next year, after which it will decrease slightly for the next few years because of a limited supply of new build and growing demand for office space.

Recent performance

Yields

Limited amount of new build will reduce supply

A vacancy rate reduction is expected The total average vacancy rate in the Oslo office market has declined since H2 2015 and currently stands at 7,5%. As the Oslo labour force is expected to increase over the next few years, the Oslo vacancy rate has been forecast to decrease correspondingly. This will also be enabled by numerous office-to-residential conversions across the city. The trend in rental levels has remained flat in all rent segments. The mood in the market suggests an increase in rental levels for prime office locations and highquality, centrally located space. In contrast, the western fringe is still expected to decrease slightly. The total transaction volume for H1 2016 has not achieved the same heights as it did during the equivalent period in 2015, but volumes remain generally in line with those of 2014, which was the second-highest transaction volume on record. We are expecting another active year in the Norwegian investment market, and our forecast for the total transaction volume in 2016 is that it will finish at around NOK75-billion.

Investment focus Norwegian offices remain a top target for investors because of favourable financing conditions and low interest rates. Oslo is yet again the core market attracting many investors’; however, there are growing levels of activity in more second-tier cities. The wealth of capital targeting the market maintains a downward pressure on yields, although no significant hardening was seen in Q2. Investment volumes reached €552million during the second quarter, with Entra ASA’s purchase of Skøyen portfolio for €271million being the most notable deal. SOUTH AFRICAN PROPERTY REVIEW

SAPOA events

INSPIRING SOLUTIONS AND ENDURING LEGACIES

Building solutions that change lives, AECOM brings sustainablility to every building project. #improving communities #sustaining environments

AECOM is a premier, fully integrated professional and technical services firm with nearly 100,000 employees - including architects, engineers, designers, planners, scientists and management and construction services professionals - serving clients in over 150 countries around the world.

We believe that communities and cities are major keys to building a nation and can be extraordinary generators of economic, social, and environmental value. With a unique blend of global reach, local knowledge, innovation and technical excellence, AECOMâ&#x20AC;&#x2122;s customised and creative building solutions result in world-class commercial, retail, educational, governmental, healthcare, tourism, residential, high-rise, multi-use and sports buildings and complexes.

Ranked as the #1

general building firm by revenue in Engineering News -Record magazine. More information on AECOM and its services can be found at www.aecom.com Follow us on Twitter: @aecom

SOUTH AFRICAN PROPERTY REVIEW

people in profile

Onisms Manyewe Head of Energy Management Bidvest Facilities Management

Onisms Manyewe spearheads the identification, implementation and benefit tracking and reporting of energy management, clean energy and green buildings interventions, generating sustainable bottom-line value for Bidvest clients. He has a BSc Honours in electrical engineering from the University of Zimbabwe, and completed an Executive Development Programme in 2013 through Wits Business School. He is internationally certified with the Association of Energy Engineers as an Energy Manager and a Measurement and Verification Professional, and also accredited by the Green Building Council of South Africa as a Green Star SA Accredited Professional for Existing Buildings Performance. Prior to joining Bidvest Facilities Management in 2010, Manyewe was a Senior Consultant at Camco Clean Energy. “Being appointed as Head of Energy Management was a fitting achievement after 15 years of experience in energy efficiency, energy management, carbon management, renewable energy, climate change and green buildings, gained mainly in southern Africa, East Africa and Central Africa,” he says. “Successfully implementing carefully considered solutions that help our clients achieve sustainable bottom-line value truly inspires me. It involves lowering buildings’ operating and total life-cycle costs, optimising resource usage and enhancing operational efficiencies, and assisting our clients in achieving their sustainability goals and targets, which include reducing their carbon footprint and the operational environmental damage.”

+27 (0)12 641 8000 Onisms.Manyewe@bidvestfm.co.za www.bidvestfacilitiesmanagement.co.za SOUTH AFRICAN PROPERTY REVIEW

SAPOA events

ENVIRONMENT

TLG6710

real FROM POWERFUL PARTNERSHIPS COME POWERFUL SOLUTIONS

At Cliffe Dekker Hofmeyr, we believe in striking a balance between your business needs today and the future. Armed with extensive experience in mining, manufacturing, renewable energy and government, as well as a practical and responsive approach to problem solving, we provide legal opinion, advice and representation that ensures your business is legally aligned for a sustainable business future. Cliffe Dekker Hofmeyr. The environmental legal partner for your business in Africa.

cliffedekkerhofmeyr.com

SOUTH AFRICAN PROPERTY REVIEW

people in profile

Legally green: environmental law’s metamorphosis T

he order goes: environmental rights, then property rights. In the Constitution, that is: Section 24 followed by section 25. The highest law of our land affords the two equal weight but the reality is it has taken many years for environmental concerns to clamber up to property rights, and demand the airtime our Constitution and its progeny legislation promised. A handful of the country’s lawyers chose to specialise in environmental law long before the practice area held any real clout in the legal profession. Terry Winstanley was one of those trailblazers – or, rather, trail-conservers. Beginning her career in Durban, Winstanley established the first dedicated environmental and planning department in South Africa. After setting this precedent, she moved to Cape Town and took further strides in the field as founder of one of the country’s first boutique environmental law firms where she spent 11 successful years practising before joining Cliffe Dekker Hofmeyr (CDH) as a partner in 2008. Widely lauded in numerous accolades, including Best Lawyers and IFLR1000, she is one of only two South African lawyers ranked in Band One by Chambers Global. The prestigious publication’s editorial acknowledges that peers regard Winstanley as a “stalwart” and a “doyenne” in her field. Heading up CDH’s environmental practice, Winstanley works alongside Helen Dagut and Sandra Gore who each have more than 10 years of post-qualification experience, earning CDH’s environmental law practice a pedigree to which few others can lay claim. The transition from a small niche firm to forming an integral part of a full-service large corporate firm is not only true of Winstanley’s career but of environmental law practice in general. What caused this decided change? Necessity. Environmental law challenges increasingly underpin large-scale projects and agreements across a number of fields, including mining, construction, energy and property. Environmental experts

National Practice Head of Environmental Law at CDH, Terry Winstanley

Property owners increasingly recognise the need to call in those relatively few experts who have seen, dealt with and solved it all before, whether

act as gatekeepers to these projects’ success in that they are able to find viable solutions to intricate environmental issues, and navigate parties through red tape. The metamorphosis is also attributable to environmental law finally finding its teeth, shaking off its reputation of being all bark and no bite. Adding further impetus to the green legal movement is that industries are beginning to buy into it, not merely because they are legally obliged to do so but because they recognise sustainability’s financial and non-financial value. This last factor is particularly prevalent in the property market. Property owners increasingly recognise the need to call in those relatively few experts who have seen, dealt with and solved it all before, whether it be meeting onerous obligations to eradicate invasive alien plant species or attaining a specialist opinion on the Waste Act and its provisions relating to contaminated land – or any of a host of other environmental factors that impact landowners. “Treating environmental issues as secondary is a recipe for taking one step forward and two steps back,” says Terry “Environmental law should not be underestimated. Too often environmental lawyers are called in as ‘fixers’ when projects go awry or come to a complete standstill as a result of failure to adhere to obligations. Calling in expert advice from the outset saves time and, importantly, protects parties from the risk of hefty fines or imprisonment”.

it be meeting onerous obligations to eradicate invasive alien plant species or attaining a specialist opinion on the Waste Act and its provisions relating to contaminated land

t: +27 (0)21 481 6332 terry.winstanley@cdhlegal.com www.cliffedekkerhofmeyr.com SOUTH AFRICAN PROPERTY REVIEW

events

Getting on par at the SAPOA Western Cape golf day

FROM LEFT Merryck Griffiths, Dave Russell, Sander Schepens, Gareth Pritchard (Baker Street Properties)

FROM LEFT Partick Parring – PAR Brokers – Gavin Mitton Design Lab Architects

FROM LEFT Debbi de Waal (Indawo), Andrew Heiberg (CDH Legal), Charl Williams (CDH Legal), Gasant Orrie (CDH Legal), Anton du Plessis (Vineyard Estates), Dean Howarth (Indawo)

Gorgeous Greens and perfect weather lent itself to a great round of amateur golf at the King David Mowbray Golf Club in Cape Town. With more than 120 players on an 18-hole pitch, there would be a close call for top honours – but it was KBAC Flooring who clinched the first prize. Second prize was awarded to Bidvest Prestige, while Rabie Properties took third prize.

SOUTH AFRICAN PROPERTY REVIEW

Ivo Nestel (Broll Properties)

PROPERTY REVIEW - LogoTreatment.pdf

2016/08/25

11:31 AM

events

Abu Varachhia with Nazeem Khan

Marlon Parring with his caddy

FROM LEFT Richard Craddock, Caroline Coates, Jacque Shaban, Paul Hart-Davies, Lloyd Neuville and Dave Russell

FROM LEFT Caroline Coates, Andre Turnbull, June Hawkins, Marius Earle, Kevin Ward and Dave Russell

FROM LEFT Jason Elley, Miguel Rodrigues, Gareth Wobbe and Dave Russell

We’d like to thank our sponsors for their support in making the day a success: ● ● ● ● ● ● ● ● ● ●

Bidvest Prestige (sponsors of the Halfway House and HWH meals) Eris Properties (sponsors of prizes four to 10) Auric Auto BMW (sponsors of the putting green Indawo (Hole 1 sponsor) DoubleTree by Hilton Hotel (Hole 4 sponsor) STBB (Hole 6 sponsor) NMC (Hole 7 sponsor) Dulux (Hole 9 sponsor) CDH Legal (Hole 16 sponsor) Securitas (Hole 18 sponsor) SOUTH AFRICAN PROPERTY REVIEW

events

SAPOA Port Elizabeth holds a networking event

FROM LEFT Denzil October, Vani Rajahmani, guest speaker Sujit Bhagattjee (Transnet National Ports Authority), Brett Grant and Errol Ritson

Coane Starke

FROM LEFT Rob Edelson, Regional Chairman Mark Bakker and Richard Vimpany

Velda Derrocks

FROM LEFT Marius Jansen van Rensburg, Alon Rathbone and Jacques Bellingham

Cisca van der Walt with Tracey Smith

SOUTH AFRICAN PROPERTY REVIEW

SAPOA Port Elizabeth recently held a networking evening, which was proudly sponsored by Investec. Guest speaker Sujit Bhagattjee of the Transnet National Ports Authority presented an update on the progress of the port, which aims to reinvent itself into a “Smart Peoples Port Concept” project. Bhagattjee discussed the project background, the importance of the people’s port, the different phases

of development as well as the time frames for each phase. It was fitting that the Investec offices were used as the venue for the evening, as members were able to see exactly what the speaker was talking about. A word of thanks to our lucky-prize draw sponsors: ●● Transnet National Ports Authority ●● Investec ●● Angel Wings Ceramics

events

SAPOA KZN hosts annual networking evening A total of 102 members were at the Lion Match Office Park in Durban for the annual networking evening

Doug Ross of JT Ross addresses guests

Regional Chairman Edwin van Niekerk

The event was sponsored by JT Ross, Overall Winners at the SAPOA Property Development Awards for Innovative Excellence 2016. The iconic Lion Match Office Park, situated off Umgeni Road adjoining the Kings Park and Moses Mabhida stadiums, also won Overall Heritage Award and was joint winner in the Refurbishment Developments at the 50th Annual Convention. Regional Chairman Edwin van Niekerk highlighted the achievements of JT Ross as overall winners at the awards in June. He also highlighted SAPOAâ&#x20AC;&#x2122;s 50-year achievement as the representative body and official voice of the commercial and industrial property industry in South Africa. Delegates were entertained by magician and mentalist Larry Soffer, and were left amazed by his level of skills. A good time was had by all the guests.

FROM LEFT Ashok Hirjee, Vumi Nyamzana and Zithobie Jiji

FROM LEFT Mthulusi Msimang, Doug Ross and â&#x20AC;&#x2030;TC Chetty

Mentalist Larry Soffer entertains the guests

SOUTH AFRICAN PROPERTY REVIEW

events

SAPOA Limpopo’s breakfast seminar with JP Landman

FROM LEFT SAPOA CEO Neil Gopal, Executive Mayor of Polokwane Councillor Thembi Nkadimeng, and JP Landman

David Hlabyago

SAPOA Limpopo Regional Chairman Paul Altenroxel

SOUTH AFRICAN PROPERTY REVIEW

FROM LEFT Adriaan Callow (FNB), Mari Delport (Mall of the North) and Schalk van der Merwe (Prism Architects)

More than 80 delegates gathered at the Pietersburg Club in Polokwane last month for SAPOA Limpopo’s breakfast seminar with JP Landman. Limpopo Regional Council Chairman Paul Altenroxel welcomed the guests, who included Executive Mayor of Polokwane Councillor Thembi Nkadimeng and SAPOA Chief Executive Officer Neil Gopal, before Landman – an analyst of political and economic trends – updated the industry leaders on the country’s current political and economic standing at the event. We would like to thank the following sponsors for making the breakfast session possible: ●● First National Bank ●● Prism Architects ●● Mall of the North

career day

Exposing learners to the property industry Property professionals from public and private sector entities introduced learners to the property industry as part of the Property Sector Charter Council (PSCC) and Construction Sector Charter Council Career Week. More than 250 learners from various high schools around Johannesburg attended the annual event, with the aim of being introduced to a career in the property industry By Stanley Karombo and Maud Nale

Mandisa Fatyela Lindie of the Department of Public Works

rogramme director Portia Tau-Sekati, Chief Executive of the Property Sector Charter Council, encouraged the learners to use the career day as an opportunity to learn from the various resources at their disposal, in order to map out a bright future for themselves. “The purpose of this annual event is to show learners that there are many exciting opportunities in the property sector and that they can access them if they are in possession of the information to assist them in decisionmaking,” she said. Various property professionals, companies and industry bodies (including SAPOA) and government representatives addressed the high-school learners about the various career options in real estate.

Mamoloko Seabe from Eskom Real Estate

Among them was Mandisa Fatyela Lindie, Deputy Director General of Policy at the Department of Public Works. She outlined the core business of Public Works – as custodians of state immovable assets and provision of accommodation to government – and used the opportunity to encourage learners to pursue a career as a property professional in the public sector. SAPOA highlighted the SAPOA Bursary Fund as a study opportunity to qualifying learners. As a member-driven organisation, SAPOA is very passionate about the Bursary Fund, which is funded by member companies. To date, the fund has assisted a considerable number of students in pursuing various career opportunities in the built environment. Although there are very strict qualifying criteria to be considered for a bursary, SAPOA encourage’s students to make use of this once-in-a-lifetime opportunity. One of the students who attended the event, Noluthando Mfanekiso (17), said the career day has been a great eye-opener. “This great initiative has been very informative,” she said. “I would advise all students to attend such career days because they could meet their next employer here.” Property associations and institutions that also participated included the University of the Witwatersrand, the University of Johannesburg, Services SETA (SSETA), Estate Agency Affairs Board (EAAB), and the Council for the Built Environment (CBE).

Margie Campbell of the EAAB

Andre Kruger of the University of Johannesburg

Samuel Azasu of the University of the Witwatersrand

Portia Tau-Sekati of the Property Sector Charter Council

Dineo Molomo of SSETA

SOUTH AFRICAN PROPERTY REVIEW

advertorial

Glitz and Glamour as Akweni celebrates its 10-year milestone in style A

ny milestone deserves a toast, and to that effect Akweni celebrated its 10th anniversary with a gala dinner at the Radisson Blu Hotel in Sandton, Johannesburg on 6 October 2016. Themed “Breaking News”, it was a momentous occasion, with esteemed guests from various industries. The guest of honour was His Excellency Kwesi Ahwoi, Ghanaian High Commissioner to South Africa. Other dignitaries included diplomats from the Ghanaian High Commission, JHI Chief Executive Officer and SAPOA President Nomzamo Radebe, SACPCMP Registrar Nomvula Rakolote, and CEOs and various businesspeople from South Africa and Ghana. Guests were serenaded by a saxophonist as they arrived, and were treated to cocktails and mouthwatering canapés. The formalities of the evening started off on a high note with a stellar rendition of Ain’t No Mountain High Enough by the local band Cappuccinos. The lyrics expressed the sentiment of Akweni’s 10year journey and achievements. The contagious laughter and comedy of the larger-than-life MC Jason Goliath, kept the audience abuzz while guest speakers and the guest of honour congratulated Akweni on the hard work and good work ethic the organisation has displayed during its 10 years in business.

SOUTH AFRICAN PROPERTY REVIEW

Speaking at the dinner, Nomvula Rakolote praised Anthony Afordofe, Chief Executive Officer of Akweni, on the company’s decade of phenomenal growth and development. She quoted the words of Steve Jobs: “You can’t connect the dots looking forward, you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future”, emphasising the value of belief in one’s goals and pursuing one’s passion. These sentiments were echoed by a trailblazer in the built environment, SAPOA’s Nomzamo Radebe, who also congratulated Akweni on its great achievements. She urged the company to “continually adapt to what the market wants today, and even anticipate what it will want tomorrow. This means constantly reassessing what you do, and how you do it. This is where innovation plays a great role.” His Excellency Kwesi Ahwoi applauded Akweni and expressed his pride that, despite the odds, the company has worked hard over the past 10 years to satisfy its clients, expand its reach beyond South Africa and position itself as a market force in the provision of a wide array of services in the built environment. He concluded by providing a brief history of the bilateral

relations between Ghana and South Africa, and the significant role that Ghana had played in the liberation struggle of African states. The evening continued with a mesmerising showing of Akweni’s 10-year journey, taking the guests down the memory lane of a company that started off with a project worth R18 000 but today boasts a project pipeline portfolio worth R2-billion. The highlight of the video was the specialeffects unveiling of Akweni’s new logo and tag line – PASSION. PRECISION. VISION. – which reflect Akweni’s repositioning at the forefront of its peers through excellent service delivery. Akweni also launched its revamped website to complement the new look of the brand, and introduced its new business units which are designed to augment its existing project management service offering. These units include property development, construction, facilities management and logistics, and are aimed at diversifying Akweni’s operations in sub-Saharan Africa and, eventually, the exponential growth of the organisation. Afordofe said that the company stands tall with a sense of pride at having achieved this milestone. He thanked all Akweni clients, business partners and professional teams, as well as the Akweni staff who have made it possible for the business to grow in leaps and bounds. After all the formalities, the live band continued its electrifying performance of local and international hits while guests enjoyed a delicious three-course meal. Later, everyone took to the dance floor to celebrate the company’s achievements. Akweni has grown from strength to strength and will continue to accomplish significant gains, as Afordofe emphasised: “It is important to us as an organisation to have good associates, and partners who make our journey a success. We look forward to being accompanied by strong alliances in our growth for the next 10 years – and beyond.”

advertorial

Akweni Ghana MD Edward Wiafe and Akweni CEO Anthony Afordofe

JHI CEO and SAPOA President Nomzamo Radebe with Akweni CEO Anthony Afordofe

The Afordofe Family

Thami Mkhwanazi and Akweni Office Manager Nokuthula Mkhwanazi with Akweni Business Development Manager Liteboho Makhele and Koanya Makhele

Akweni CEO Anthony Afordofe and SACPCMP Registrar Nomvula Rakolote

Enumerate Quantity Surveyors

MC Jason Goliath entertaining guests

Akweni Ghana staff

Akweni Business Development Assistant Elzet Pienaar and Portfolio Manager Siphosethu Plata

MaDhlamini-Kumalo and Akweni CEO Anthony Afordofe

Richard Tainton (Volvo) with Akweni Technical and Development Manager Lynette Hewitt and RLB Pentadâ&#x20AC;&#x2122;s Andrew Mmbara

Cappucinos electrifying performance

Ghanaian High Commission delegation with Akweni CEO Anthony Afordofe

Akweni 10th Anniversary Table Setting

Johannesburg office +27 (0)11 486 3315 Ghana office +233 54 975 5381 litebohom@akweni.co.za www.akweni.co.za SOUTH AFRICAN PROPERTY REVIEW

off the wall

Powering up your ride The idea of using the sun’s energy as fuel is inherently appealing. However, many people have also raised valid questions about the usefulness of solar-powered cars as a reliable means of transportation Compiled by Phil Ruimte

he first solar cars made an appearance in the late 1970s. According to the Guinness Book of World Records, the first completely powered solar car was developed in 1984 by Greg Johanson and Joel Davidson. Solar cars use photovoltaic cells (PVCs) to convert the sun’s rays into electricity. In newer designs, the electricity is used in two ways. First, it powers the motor so the car will move. Second, some of the electricity is stored in a battery so the car will be able to function on cloudy days, at night, and in dark spaces such as parking garages.

The Sasol solar challenge The V&A Waterfront recently saw the completion of the 2016 Sasol Solar Challenge – 11 teams from around the world crossed the line. The Sasol Solar Challenge is a competition for teams to design, manage, build and drive solar-powered vehicles across South Africa. The eight-day event sees local and international solar-powered cars travel as far as they can on various roads and loops between Pretoria and Cape Town. Some teams travel distances of more than 4 000km. This year’s event began on 24 September and concluded on 1 October, traversing some of the world’s most beautiful and diverse landscapes, from desert and savannah to mountains and coastal forest. International teams are attracted to the challenge of competing in an event that covers 2 000km of varying road conditions, and drops nearly 2 000m in altitude. The Sasol Solar Challenge initiative is intended to encourage young people to

achieve success in “STEM” subjects – science, technology, engineering, maths. It helps educate young people in the principles of science, technology, engineering, innovation, teamwork and business, and promotes collaboration between students, industry and government. Students get an opportunity to practically apply the science and technology theory they’ve learnt at school or university, and South African students in particular get a chance to test their engineering skills against some of the best solar-car teams in the world. Dutch team Nuon won the Challenger class after completing 4 716km, breaking the fouryear-old record of 4 630km and beating Japanese team Tokai by 172km. With new regulations set for the global competition, all teams will use the South African event to build completely new vehicles for the 2017 challenge in Australia, which is shorter than the Sasol Solar Challenge. In South Africa, five teams held their own against tough international competition. North-West University came in fourth position with 3 524km under their belt, and highschool team Maragon Olympus came seventh, beating the University of Johannesburg by just 40km. For the Sasol Solar Challenge, a new record has been set – and teams are already planning their return in 2018 to improve on this year’s achievement.

Facts on solar-powered cars ● Solar cars have impressive speed and distance records. ● Toyota Prius is one of the most appreciated solar-powered car models at the moment. This vehicle features a solar roof that powers the car’s heating and cooling system. ● Solar-powered cars have higher limits of endurance than people commonly believe. ● Venturi Electric is the company that shocked the world in 2006 when it presented the first car powered by both solar and wind power. This vehicle is capable of travelling more than 48km/h. ● The fastest solar car in the world is believed to be the Holland Nuna 2. One of the most curious things about this vehicle is that it was actually built by Dutch students. ● The longest distance that has been travelled by a solar car in a day is 480km, over hilly terrain. ● Solar cars are environmentally friendly. This means that no matter how much you use them, you will never have to worry about the effects they will have on the environment.

For more information contact: Anzet du Plessis media@solarchallenge.org.za +27 (0)83 557 2322 www.solarchallenge.org.za

SOUTH AFRICAN PROPERTY REVIEW

SAPOA events

GREEN STARS FOR AFRICA

BROUGHT TO YOU BY WSP | PARSONS BRINCKERHOFF

With over 136 Green Stars achieved on more than 30 projects in Africa, WSP | Parsons Brinckerhoff are Africaâ&#x20AC;&#x2122;s leaders in green building and sustainability consulting. We are a founding member of the Green Building Council of South Africa, and have been part of driving the establishment of Green Building Councils in Namibia and Rwanda. Our people are passionate about green building design, helping our clients choose environmentally friendly solutions for their building projects. We strive to change the way the world is constructed, ensuring a sustainable future for our continent.

34 500

500

EMPLOYEES

OFFICES

COUNTRIES

Learn more about this and other projects on www.wsp-pb.co.za

SOUTH AFRICAN PROPERTY REVIEW

SAPOA events

Specialised Knowledge and Expertise 3

1 Medical facility for 200 Rivonia Road in Morningside, Johannesburg. Architects: Geyser Hahn Architects. 2 The Union office development for Eris Properties in Accra, Ghana. Architects: Boogertman + Partners. 3 & 4 Head office for Business Connexion for BCX HQ Offices Co-ownership JV in Centurion, Pretoria. Architects: Stauch Vorster International. QS services in JV.

Whilst timeously and adequately providing traditional quantity surveying services DelQS identified and developed certain services vital to the bottom line of investors • Elemental construction cost estimating • Financial viability analysis (in-house developed program : precise and logical in presentation) • Building contract expertise • Final settlement with contractors • Cost control and reporting (in-house developed program: proactive and audit trail) • Africa projects (expertise and track record) • Specialised developments (retail, hospitality, healthcare, student housing, etc)

QUANTITY SURVEYING

Nico Roos

Liza Botha

Wilco Lourens

Gerhard de Leeuw Akopo Africa

Corné de Leeuw

Christine Larson

SOUTH AFRICAN PROPERTY REVIEW

DISPUTE RESOLUTION

PROPERTY VALUATION