SAPOA breakfast with Executive Mayor of Cape Town

Cape Town Executive Mayor Patricia de Lille

The Honourable Executive Mayor of Cape Town, Patricia de Lille, addressing the South African Property Owner’s Association at The River Club, Cape Town. Image Credit – SAPOA


On Friday 19 September, the South African Property Owners Association (SAPOA) hosted a talk by the Honourable Executive Mayor of the City of Cape Town, Ms Patricia de Lille, accompanied by Executive Deputy Mayor Ian Neilson at the River Club in Cape Town.

The Mayoral executive team addressed the property industry about key Economic Development factors that will have a significant influence on future property developments and associated strategies. Throughout the talk and during further discussions, the Mayor stressed the importance of a close collaboration between The City and the property industry in balancing socioeconomic needs with development needs, stating that “we are re-imagining Cape Town in order to create a city that works more efficiently and effectively, for all our residents.”

We have summarized the major talking points into four key themes:

  1. Achieving Sustainable Growth and Urbanization for Cape Town

  • The City of Cape Town has managed to maintain its status as the best performing metropolitan area in South Africa, despite the city having grown significantly over the past 10 years. Cape Town is in a strong financial position and enjoys a triple-A credit rating.
  • Concerns were expressed over the anticipated growth of the City. Currently, Cape Town is accommodating approximately 1 000 000 households, which is set to increase significantly over the next 10 to 15 years. It is therefore clear that the city’s current development model cannot be sustained, and that a focus is required on densification of new property developments.
  • In order to cope with the significant influx of new households, The Mayor team highlighted the significance of development projects that are inclusive of the City’s wider socioeconomic development strategy.
  • In order to fund future growth and developments in Cape Town, the Mayor is prioritizing a focus on Asset and Facilities management to raise revenue. The Mayor made it clear that National Government will not be investing further into the city, which means that an even closer relationship between the private and public sector needs to exist to ensure Cape Town’s long term sustainability.
  1. Tackling Infrastructure and Congestion

  • The City will focus significant time and resources on integrated transportation solutions over the next 5 years. Cape Town is currently rated as the most congested city in South Africa by TomTom.
  • The City has allocated R750 million to address congestion, drawing in the property industry and all other relevant stakeholders to achieve an integrated solution.
  • The Engineering faculty of the University of Cape Town has been approached to find an innovative solution to the incomplete highways in the CBD, with the objective to alleviate congestion in the CBD.
  • Transit-oriented development was noted throughout the Mayor’s talk. For developers, this implies that The City will favour developments on existing public transport infrastructure. Areas of particular focus include Bellville, Paardevlie, Athlone, Phillipi and Cape Town CBD. The Voortrekker Road Corridor will be of particular interest to the City, with the Mayor stating that “The City, in partnership with the Western Cape Government, has identified and prioritized a pipeline of properties that offer the potential for inclusive transit-oriented development. It is our hope that these properties are developed in partnership with the private sector.”
  • The further rollout of the MyCiTi bus network towards the South of the City is estimated to connect another significant population to quality public transportation. Investment into rail infrastructure was not addressed in the talk.
  • Congestion in Cape Town is fuelled by low density development implicating long distance travel. Therefore, the current trend of developments taking place on outlying areas of the Cape Metropole will be discouraged by local government.
  1. Developers to focus on High Density, Affordable Residential Property Solutions

  • A major implication for property developers is that The City will favour mixed-use developments and densification within already developed areas close to key transport corridors. Mr Neilson commented that “there will be densification from the CBD all the way to Kommetjie”.
  • Continued property development around the borders of the City (low density housing with long distance travel implications) is not in line with the Mayoral team’s strategy. The Mayor argues that this approach fuels congestion, stating that “We are going to prioritize the further investment into infrastructure within the existing footprint and, in particular, high density developments. We welcome SAPOA’s interest in researching inclusionary housing and how this can be a viable proposition for the private sector in Cape Town.”
  • With the average house price growth in Cape Town significantly higher year on year compared to the national average as confirmed by SAPOA, affordable housing was a significant topic of discussion. Property Developers are encouraged to find solutions to inclusive social housing closer to the CBD. SAPOA and The City will be taking on a joint research venture to assist developers within this regard.
  • The City is planning eight new large-scale housing projects which it anticipates to be constructed between 2016 and 2019 at an estimated cost of over R250 million.
  1. Diversification of Energy Resources and Renewable Energy

  • Local Government will place significant focus on reducing Cape Town’s dependence on the national power grid, long term sustainability and maintaining Cape Town’s status as one of the greenest cities in the world.
  • Currently, National Government is preventing The City from sourcing electricity from local or independent producers which will be contested in court. The Mayoral team will be focusing on securing more diverse and renewable sources of energy, arguing that it is a risk for The City to rely solely on the national power grid.
  • Further implications for property developers will be that Green building practices will be encouraged and more strictly enforced by The City of Cape Town.

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