Completion on the cards for Cape Town’s roads to nowhere The City of Cape Town wants to partner with the private sector to find a solution for the three abandoned highways leading into the inner city, which have been an eyesore for close to five decades.
prospective investors, or a consortium of companies, will soon have the opportunity to bid to be part of a new development that will help resolve the traffic congestion and provide affordable housing in close proximity to the Cape Town city centre. Cape Town mayor Patricia de Lille announced on Tuesday, 21 June that the City would make available 6ha of its own land to a successful bidder in the private sector in exchange for the completion or redesign of the unfinished highways as well as a housing scheme. The area for housing stretches from the Cape Town International Convention Centre to the unfinished bridges.
Construction of the highways on the western, central and eastern side of Cape Town’s foreshore started in the 1970s, but the project was abandoned after a while, mainly due to a lack of funds and because traffic congestion at the time was not nearly as severe, which didn’t warrant further investment.
Fast-forward 46 years and the situation is completely different – Cape Town has surpassed Johannesburg as the most congested city in South Africa and it ranked 47th in the world as far as traffic is concerned.
“When I became mayor I pledged to do something about the unfinished highways,” De Lille said. “Not only are they useless, other than for film shoots, they are also preventing the development of prime City-owned land that is locked in under and between the existing highways and the harbour.”
The City imagines the new development would leverage the City-owned land beneath the unfinished bridges and part of the conditions will be that it includes the funds to complete the unfinished bridges, alleviate congestion and provide affordable housing.
A number of urban planners are suggesting that housing projects should involve the development of unused urban spaces and mixed-income residential schemes rather than large developments on the city’s fringes.
Cape Town, like other metros in SA, is characterised by urban sprawl – new developments are often located on the outskirts of the city, which has a negative impact on the mobility of especially poorer people, who are dependent on public transport.
Statistics show that 95% of public transport users are in the low-medium income groups, and that average direct transport costs for low-income public transport users make up 45% of their monthly household income.
On 8 July, the City will officially issue a prospectus outlining all the necessary information for the prospective development. The public and interested parties will have access to the document and get to know the City’s expectations for the mixed development, called the Foreshore Freeway Precinct. Prospective bidders will have to present scale models of their designs, which would be on display in the City’s headquarters at the Civic Centre where the public would be able to view the designs. The bidding process will extend until at least December 2016. Brett Herron, mayoral committee member for transport, said a thorough public participation process would take place before the contract will be awarded to the successful bidder and another round of public participation will ensue before building starts. The question, though, is whether the City of Cape Town’s ambitious project would garner enough interest from prospective developers and construction firms, especially in light of low economic growth, high inflation and rising interest rates that make the private sector cautious about spending on new investments. But Christie Viljoen, economist at KPMG, is of the view that Cape Town wouldn’t struggle to get investment from the private sector. “Construction in the Cape Town city centre and the Western Cape as a whole is alive and well, and there would definitely be interested parties.” A consortium of companies with different skill sets would most probably undertake the development, says Viljoen, as opposed to one single developer. “In the end it would be a financial decision – would the yield from the housing project justify the spending on road infrastructure?” The project will need a developer and a financier to fund it, engineering and construction group Murray & Roberts told finweek by email. “Typically, a developer would undertake a feasibility study to assess whether the project makes financial sense to the extent that it would attract the necessary private investment.” It wouldn’t happen in the foreseeable future, either. “Public-private partnership projects typically take anything from 12 to 18 months before any construction can start and they are expensive to bid, as a lot of potentially abortive costs are incurred in upfront investigations and designs, which would not be recoverable if the project does not go ahead or is found not to be feasible,” Murray & Roberts said. “However, the project is a novel idea and the City should be praised for thinking outside the box.”
Construction on the highways in Cape Town’s city centre started almost five decades ago, but the project was abandoned due to a lack of funds.