Property developers in the inner city of Johannesburg have urged government to extend the urban development zone (UDZ) tax incentive to more areas in the city and to extend the timeframes of the benefits, which are scheduled to come to an end in 2014.

Since the UDZ tax incentive was implemented in Johannesburg in 2004, some R8,9-billion in private sector investment has flowed into the inner city, with about 65 000 construction jobs created through the process – 30% of those jobs being permanent, explained City of Johannesburg spatial economic development deputy director Lebo Ramoreboli.

The City of Johannesburg’s economic development department expected at least R15-billion in private sector investment into the inner city by the end of the UDZ tax incentive window in 2014, with estimated 125 000 construction jobs created over the duration of the incentive.

Ramoreboli said that the City heeded the call of developers and was working with the National Treasury on the possible extension of the UDZ incentive timeframes, to further spur development in the inner city.

South Point Property Investments owner Robert Lowdon reiterated that the UDZ tax incentive was a very significant driver of investment into the inner city, and one which his company had taken advantage of.

South Point acquired its first buildings in Johannesburg in 2004, and now owns and operates numerous buildings, which were acquired as “underutilised and stressed” buildings and have since been refurbished.

The company invested some R700-million in the inner city, with its current property portfolio including 12 student accommodation facilities, three residential apartment blocks, six commercial office buildings, and the group’s first hotel, which was opened in October 2010.

South Point’s Lamunu Hotel consists of 60 rooms, conference facilities, a restaurant and bar, and an attractive outside area, where existing buildings were demolished to create open space for activities such as concerts, movie showings and sport viewing on a big screen.

Lowdon told Engineering News Online that construction took about nine months and the contractor was Akhane construction, with architectural work done by Lupini Architects, and interior decorating by Dakota Interiors.

The hotel is located in Braamfontein, where a City Improvement District (CID) to boost security and cleanliness in the area is in operation.

While Lowdon lauded the City of Joburg on the UDZ tax incentive, which has allowed the company to create viable precincts in the city, he also said that the City of Johannesburg could improve in the area of creating and maintaining public spaces in the city.

He added that there was a need for more street greening and visible signage for visitors to the city, as well as occasional permission to use streets as events space.

He conceded that safety and security still needed attention, because even though there was a significant CCTV surveillance system in place in the city, often cameras were not working. High levels of crime was one of the major reasons that people and businesses left the inner city, which led to its further degradation in the past.

Service delivery was another issue property developers raised, and it was noted that at times streetlights did not work, stormwater drains were blocked, street cleaning and refuse collection were poorly handled, and pavements were left in a bad state.

Affordable Housing Company (Afcho) CEO Renney Plit conceded that the level of frustration from the private sector in the inner city was at an all-time high, in particular owing to the recent billing crisis, which was still an issue.

Afhco and numerous other private sector developers such as the Jozi Housing company, and iThemba Properties, provided affordable housing in the city, catering for people earning between R3 000 and R10 000 a month.

Plit explained that Afhco had recently completed Lustre House, which consisted of 148 newly renovated flats, which went on the market in May. In just 11 days, 22 flats have been let – highlighting the need for accommodation of this sort in the city.

He stated that the city should properly cater for the indigent people in the city.

Plit further said that there was a desperate need for housing for people earning very little, as this category of people often fell foul to slumlords operating hijacked buildings, which were not properly maintained.

People could not be evicted from ‘bad buildings’ unless the city provided them with alternate accommodation, and thus there was a need to establish ‘decent facilities’ where people could be moved to so that bad buildings could be fixed.

City officials and private sector developers spoke openly and politely about the issues in the city, and City of Joburg officials said they would follow up on a number of the problems raised by businesses.

“The City must harness the skills, ability and passion of private developers and roll the boulders out of the way,” added Jozi Housing company CEO Sandy Barnes.

City of Johannesburg member of the mayoral committee responsible for economic development Oupa Monareng thanked investors for “putting your money where your mouths are”, and emphasised that partnerships were essential if the city was to achieve its goals.