Joburg’s in­ner city land au­dit, hi­jacked build­ings to be con­verted into low-cost flats

The Star Early Edition - - NEWS - Roy Cokayne

THE CITY OF Jo­han­nes­burg is to launch an ini­tia­tive to con­vert hi­jacked build­ings into low-cost res­i­den­tial rental stock.

City of Jo­han­nes­burg Mayor Her­man Mashaba con­firmed last week that the city was con­duct­ing an ex­ten­sive land au­dit of the in­ner city to iden­tify and pri­ori­tise hi­jacked build­ings that could be con­verted into rental stock.

Mashaba said th­ese build­ings would be made avail­able to the pri­vate sec­tor for devel­op­ment, with the city of­fer­ing in­cen­tives to pro­mote the devel­op­ment of res­i­den­tial rental stock. This formed part of a new plan launched by the city to re­claim the in­ner city that was fo­cused on ad­dress­ing the prob­lem of hi­jacked build­ings, Mashaba told a chief ex­ec­u­tive Global Awards din­ner in Kemp­ton Park.

The ini­tia­tive has been wel­comed by Ind­lu­place, the first res­i­den­tial-fo­cused real es­tate in­vest­ment trust to list on the JSE, and Oc­todec, which has con­verted many of­fice build­ings into res­i­den­tial apart­ments in Jo­han­nes­burg and Pre­to­ria.

Back­log

Mashaba said the city had a hous­ing back­log of more than 300 000 units, and 158 000 peo­ple were on the wait­ing list for free hous­ing. There was a net mi­gra­tion of 3 000 peo­ple a month into Jo­han­nes­burg.

“The devel­op­ment of the in­ner city rep­re­sents a great eco­nomic op­por­tu­nity for pri­vate-sec­tor in­vestors… and has the po­ten­tial to boost both eco­nomic growth and job cre­ation,” Mashaba said.

He said pro­pos­als to de­velop hi­jacked build­ings would be is­sued in a trans­par­ent and open sys­tem and would be avail­able to any­one who met all the re­quire­ments. Th­ese re­quire­ments re­lated to how much money would be in­vested, the num­ber of res­i­den­tial units that would be built, the num­ber of peo­ple who would be em­ployed and trained dur­ing the con­struc­tion phase, and the rentals that would be charged.

Mashaba said 18 per­cent of the city’s cap­i­tal ex­pen­di­ture was al­lo­cated to the in­ner city, which demon­strated that it was se­ri­ous about re­claim­ing the in­ner city.

Re­de­vel­op­ment

Jef­frey Wap­nick, the man­ag­ing direc­tor of Oc­todec, wel­comed the en­gage­ment with the City of Jo­han­nes­burg with a view to un­der­stand­ing its pro­pos­als for the re­de­vel­op­ment of hi­jacked build­ings in the cen­tral busi­ness dis­trict (CBD).

“We are al­ready en­trenched in the Jo­han­nes­burg CBD and are will­ing to con­sider fur­ther in­vest­ment on the ba­sis that we are able to strike a bal­ance be­tween cater­ing for the needs of the com­mu­ni­ties in which we op­er­ate by pro­vid­ing well­priced qual­ity ac­com­mo­da­tion, yet still pro­vid­ing rea­son­able re­turns to share­hold­ers.

Ind­lu­place chief ex­ec­u­tive Carel de Wit said his com­pany was al­ready in­vested in the in­ner city, and al­most 2 500 fam­i­lies had their homes in the 25 build­ings it owned there.

“Mak­ing the city your home re­quires more than the ren­o­va­tion and up­grad­ing of build­ings. One of the great­est chal­lenges is to make rent­ing or own­ing af­ford­able. The city will have to look to deal­ing with the cost of rates and util­i­ties – elec­tric­ity in par­tic­u­lar – the cost of which have es­ca­lated much higher than in­fla­tion and now con­sti­tute a large per­cent­age of the monthly cost of ac­com­mo­da­tion,” he said.

PHOTO: NOKUTHULA MBATHA

Jo­han­nes­burg Mayor Her­man Mashaba says the re­de­vel­op­ment of the in­ner city rep­re­sents a great op­por­tu­nity for in­vestors.

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