Real Estate Investor Magazine South Africa December - January 2014 | Page 48

DEVELOPMENT

BY JONATHAN SMITH

Negotiating The Town Planning Minefield
The key to triumph is strategy

P

roperty developers rely on three foundation
legs in order to successfully develop fixed
property:

•

•

•

a growing economy which creates demand
(and subsequent take-up) of space;
successful interaction with the relevant local
authority (municipality) in order to obtain the
necessary development rights for a new fixed
property development;
the ability of construction companies to
soundly construct a proposed development
within the parameters of the financial
feasibility on which a project has been based
and implemented.

The first and third foundation legs mentioned
above are factors which can be determined and
controlled through mathematical models but
the second factor, that of interacting with and
obtaining the necessary consent of local authorities,
has become an extensive cause for concern over a
period of some ten years now.

Property development still prominent
Readers may know that there is still justification
across many property categories for new property
development throughout South Africa. For
example, although most urban areas are overshopped, rural areas and some of South Africa’s
smaller towns are somewhat under-shopped,
creating a plausible need for new shopping centres
sometimes as large as thirty thousand square
metres. Another example in this vein is that the
fairly recent transport infrastructure development
(including the Gautrain and the new airport on the
48

north coast of KwaZulu-Natal) have all established
development-friendly corridors conducive to
residential, retail and industrial development.
And, as these opportunities are exploited, so a
need for tertiary sector offices shall arise. South
Africa’s housing shortage is another sound reason
for (residential) property developers to consider
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