The gold mines are long exhausted but there is a new way to get rich in Johannesburg: property. An economic boom is transforming what was once South Africa’s byword for crime and decay into a vibrant metropolis.
Muggers and squatters in the notorious centre are making way for yuppies, loft apartments and renovated skyscrapers in what is one of the world’s fastest-growing property markets. By some estimates the value of real estate has risen 35-fold in six years, an extraordinary surge that outstrips growth rates in Manhattan, London or Sydney.
Some developments include platinum-plated taps, rooftop swimming pools and helipads. Popping up like toast around these luxury complexes are smart but relatively low-cost apartment blocks for a largely black middle class.
Scenes unimaginable a few years ago — BMWs parked in the street, people using cellphones in public — have become commonplace with the 80% reduction in recorded rates of violent crime, partly the result of the installation of closed-circuit television cameras and a new Metro police force.
”In the 1990s landlords were literally giving away properties. They wanted rid of them. Now it is the most important commercial sector in Africa,” said Gustav Holtzhausen, managing director of developer Circlevest Properties. ”I’ve never experienced or seen a mugging. If you walk through town you find the animosity is gone, the lawlessness is gone.”
Neil Fraser, an urban consultant credited with helping to spearhead the revival, said the key was making the city safer. ”Tackle the crime first and create a platform for investment.” A similar approach worked in Atlanta, Washington DC and Philadelphia, he said.
New apartments range from R535 000 to R2,1-million. Last November the maker of Dom Perignon champagne, Moët & Chandon, chose Johannesburg for the glitzy launch of its 1998 vintage.
The revival is the latest twist in the story of a city founded in 1886 when an Australian prospector, George Harrison, stumbled across the world’s richest gold-bearing reef on a patch of Transvaal farmland. The ensuing gold rush turned it into a boomtown uneasily shared by the British, Boers and Africans.
Colonial-era discrimination hardened after World War II into apartheid, which kept black people in townships outside the city centre, leaving it a commercial citadel and symbol of white might. When white minority rule weakened in the late 1980s, restrictions were lifted and hundreds of thousands of impoverished blacks flocked into the city seeking jobs and homes.
Rattled by the influx, many businesses and institutions such as the stock exchange fled to the northern suburbs. Police lost control, living conditions degraded and crime rocketed.
”The mid-90s were an absolute low point. A lot of people thought the city was in a tailspin from which it would never recover,” said Fraser.
Several factors turned the tide. A partnership between governments and those businesses that stayed installed closed-circuit cameras linked to rapid-response police units. Tax breaks and ”city safaris”, in which investors were bussed around various sites, encouraged them to take over and develop cheap properties for commuters considering moving back into the city.
From R107 per square metre in 2000 real estate has risen to R3 700, and is predicted to continue rising to R37 000, said Holtzhausen. A turnaround that will be fuelled by a new train link to Pretoria and the hosting of the football World Cup in 2010.
The jewels are the new Nelson Mandela bridge, the revamped Constitution Hill and the districts of Newtown and Braamfontein, home to museums, theatres, jazz clubs and restaurants.
Jacques du Toit, a property economist with Absa bank, said that regeneration had yet to reach rundown districts: ”There is still a long way to go. It is only starting to pick up momentum. In five or 10 years, you’ll see the difference.”
Critics complain that the price for gentrification is paid by evicted squatters. Last month a Johannesburg court ruled such evictions were illegal unless the authorities provided alternative accommodation. Some warned it would hinder renovations but Tshepo Nkosi, spokesperson for the Johannesburg Development Association, said the ruling was humane and sensible. ”It just means we will have to stretch our resources.”
On a tour of the city centre Nkosi pointed out initiatives aimed at integrating the poor and working class: public toilets and bathhouses, roofs for markets, paving and lighting designed for pedestrians. ”We’re not a pretty city, we’re not Durban or Cape Town, but we can still persuade tourists to spend an extra day or two here,” he said.
Guide books no longer warn readers to steer clear. ”If you want to see the real South Africa — and try to understand it — Joburg has to be on your itinerary,” says the latest edition of Lonely Planet.
Backstory
Johannesburg is still sometimes called by its Zulu name, Egoli, which means ”place of gold”. Forty percent of the world’s gold has been found in or around the city. About 3,2-million people live there, accounting for 7,2% of South Africa’s population, and it produces one-sixth of the country’s wealth. Soweto, the former township 16km from the city centre, now attracts more tourists than the Kruger national park. But for all Johannesburg’s ritzy development and booming property prices, not everyone is cashing in. There are 200 000 shacks in the city with between 250 000 and 300 000 people on the housing waiting list. – Guardian Unlimited Â