Real Estate Investor Magazine South Africa July 2013 | Page 47

COMMERCIAL

ABOVE LEFT: Greatermans Department Store Before Refurbishment
in shocking condition, which became hijacked
after we gave notice to the residents to vacate
so that the building could be refurbished. We
have been involved in court battles trying to
obtain an eviction, for about four years. Besides
the holding cost on the investment value, other
costs such as legal fees, security costs and
Council charges build up very quickly.”
“The courts have ruled that the City Council is
responsible to provide alternate accommodation
to the low-income occupants, but they fail to
do so, and the process drags on. While Council
has hardly delivered to this market sector
despite being told to do so by the Courts, it has
also unfairly become the burden of the Joburg
Council and the Joburg ratepayers to foot the
bill for the huge urbanisation taking place in
the country, and also the huge migration from
Africa into Joburg, both legal and illegal. Joburg
inner city is seen as a place of opportunity to
make money, and trade in the city is massive,”
explains Renney.
Along with these problems come the very
visible problems faced in the inner city of
service delivery and the billing system of the
Johannesburg City Council. A city, which is
dirty, poorly maintained and mismanaged,
creates a poor environment for investment.
Any capital interventions by the Council tend
to deteriorate, as there are simply no on-going
maintenance plans. Despite service delivery
protests and this issue becoming a hot news
www.reimag.co.za

ABOVE RIGHT: After Refurbishment

topic as residents become fed up with the lack of
service delivery, will this bring about change?

towards public transport, bicycle routes and
pedestrian walkways”.

Johannesburg Executive Mayor Clr Mpho
Parks Tau said in his State of the Cit y
Address that in the 2013/2014 financial year
alone, the City would spend R7.3 billion on
infrastructure, a 37% increase compared with
the current year’s infrastructure spend of
R4.6 billion. Expenditure on the maintenance
of the current infrastructure would be increased
from 2.5% to more than 7% of the city’s annual
budget, he said.

The Executive Mayor said the new spatial
master plan would “transform apartheid
settlement patterns and build and vibrant
middle-class environment, where everyone
can feel safe”. Despite the vow to clean up the
crime and grime, it still remains to be seen
whether this will be implemented effectively
and maintained, after all it doesn’t matter what
plans are implemented if there is little or no
follow through.

T he massive in f rast r uc t u re spend ing
w i l l resu lt in Johannesburg competing
favourably with other major cities on the
African continent, where seven of the world’s
fastest growing economies are found. Of the
R7. 3 bi l l ion t h at wou ld b e s p ent on
infrastructure in the 2013/2014 financial year,
which starts on July 1, R450 million would be
channelled into the inner city to address issues
such as crime and grime, poor urbanisation,
overcrowding and safety.

Despite these challenges there is still a lot
of positivity surrounding the CBD and the
inner city as developers continue to change
the face of the inner city and provide much
needed affordable housing. The urbanisation of
Johannesburg’s CBD has had a positive effect
on the city, it has become the permanent abode
of hundred of thousands of residents and their
children. The slogan “Live Play Work Shop”
defines the city. There is also the hope that
government and council will become more
engaged and work together with developers and
each other to see real change happen. Renney
says: “The City is changing and redeveloping
at a rapid pace, despite the lack of Government
and Council assistance. Imagine what could be
achieved if these two public bodies performed.”

A s pa r t of t he 10 -yea r R 110 bi l l ion
infrastructure expenditure programme, the
city is to introduce a high-density residential
development – described as the new “Corridors
of Freedom” – that would not only change
Johannesburg’s urban landscape, complete with
new transport arteries, but would also represent
“a decisive move away from private vehicle use

RESOURCES
AFHCO
July 2013 SA Real Estate Investor

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