/ 6 April 2011

Jo’burg launches inner-city property scheme

Johannesburg mayor Amos Masondo launched the Inner-City Property Scheme (ICPS) on Wednesday.

“The ICPS is an important initiative by the City of Johannesburg, in partnership with the private sector, to address urban decay and accelerate the rejuvenation of the CBD [central business district],” Masondo told journalists in Johannesburg.

” … The state and appearance of a CBD is an important barometer to determine the ability of a city to attract and retain investment.

“It is also a reflection of the extent of the advancement to commerce and overall economic development.”

The ICPS was replacing the Better Buildings Programme which had the objective of turning “bad” buildings into “better buildings”, he said.

However, the BBP was only moderately successful. This was because of the lengthy expropriation process, the screening of participants and the requirements to provide transitional housing to people who had been evicted, Masondo said.

The solution to this was the ICPS developed by the department of economic development, to transfer expropriated properties into an Inner City Property Portfolio.

He said Broad Base Black Economic Empowerment (BBBEE) participants would hold the controlling shares.

There were 30 buildings which would be refurbished.

Each BBBEE investor had to invest R5-million into the rejuvenation programme, he said.

A panel of BBBEE service providers would also be created and responsible for the rejuvenation of the buildings.

“This makes the Inner City Property Scheme one of the most far-reaching broadbased black economic empowerment transactions yet introduced in South Africa — and definitely the biggest in the property field.”

Masondo said the city would transfer properties that were dilapidated, abandoned, illegally occupied or hijacked as well as vacant pieces of land through a developmental lease with an option to buy.

Once the buildings were transferred they would be refurbished and brought in line with the building code of the city to turn them into viable and productive economic assets, he said. — Sapa