Changes are that if youâ€™re reading this, you live in a city, or you commute to a city on a fairly regular basis in the line of your work. Chances are also pretty strong that youâ€™ve travelled to a couple of cities abroad, so you have some point of reference as to how SAâ€™s cities compare to world cities, in terms of their environment, their public transport and their offerings to citizens.
These are all factors that determine a cityâ€™s status as a global destination, but they also have an impact on investment potential, and on the value of property. Focusing on achieving world class competitiveness is on the cards for urban SA, with four leading cities (Johannesburg, Tshwane, Cape Town and Durban) having already identified city improvement districts with substantial success.
For example, according to Neil Fraser of Urban Inc, in 1998, R22,98m in inner city Johannesburg property changed hands. Last year that figure increased to R351,279m, showing not only an increased demand, but also a substantially increased value.
FNB economist and property specialist John Loos pointed out that property values in the inner city have grown exponentially since 1998 â€” Doornfontein by 500%, Braamfontein by 210%, Newtown by 200% and Village Main by 150%.
Much of this can be attributed to renovation and revitalisation projects taking place in the city, creating accessible accommodation for city workers.
According to Jason Brooks, a UK director of consulting firm WSP, more than 50% of the worldâ€™s population lives in cities, and in 20 years time, that figure is projected to be 75%. SA is certainly following this trend, with what he calls the â€œDick Whittingtonâ€ phenomenon, where the rural poor go to cities to seek their fortunes.
Brooks is adamant that the success of a city, particularly one such as Johannesburg, is going to centre around infrastructure planning considering population growth, even planning far beyond conservative projections.
Loos also highlighted the phenomenon of the CBD being a magnet for the poor, and emphasized the importance of building other nodes to take the pressure off these areas.
He pointed out that low income groups are adding increasing value to the economy now that their energy has been unleashed, and theyâ€™re making no small contribution to SAâ€™s projected 6% economy growth next year.
Of interest to residential developers in particular is the fact that although the population may be growing by 15%, the number of households has increased by 30%, with the average number of people in a household dropping.
This is a direct result of improved income and education, according to Loos, and the challenge for property owners and developers into the future is going to be to keep up with the demand from entry level property owners.
Loos also identified how the profile of urban residents is set to change, with the middle to upper income groups living in country residences and commuting to their city jobs, offering their children the benefits of a less urban existence.
Many of these business people have an apartment in the CBD for during the week, travelling home over weekends. Such an executive would demand a lock-up-and-go apartment at the heart of his or her business environment â€” along the lines of the soon to be handed-over Emperor on West Road South.
Another demographic is the young, working graduate or starter couple, who seek something a little less expensive, but who demand proximity to their urban work and play environments.
Developers increasingly need to consider the economic level below that in their CBD projects such as people who currently travel two to three hours a day from outlying areas, into the CBD for work, but who just canâ€™t afford to live closer to their jobs. It can be argued that the Gautrain will certainly relieve some of this pressure.
Gauteng MEC for Transport, Ignatius Jacobs is now focusing on alleviating environmental decay and social inequality through the implementation of an effective public transport system.
Government property management company Intersite has identified this as well, and has already developed several housing precincts around Metrorail station, an indication of things to come once the Gautrain is up and running.
Speakers at the convention agreed that for a city to truly work, it needs to be a safe place where peopleâ€™s needs are met â€” work, entertainment and social, retail, residential and itâ€™s making sure that the city is alive at all times that will ensure the success of any revitalisation.
This implies effective public transport that operates at all hours, combined with investment in retail, commercial and residential developments, as well as infrastructure. What needs to follow on residential developments in the inner city areas is social space.