Khayelitsha Business District - National Treasury 4-5 Mar 2010/Khayelitsha... · Property Management City of Cape Town Khayelitsha Business District Planning for the Operation, Management

4 March 2010

André HumanActing Manager: Development

Property ManagementCity of Cape Town

Khayelitsha Business District Planning for the Operation, Management and Maintenance of

Township Nodes

Khayelitsha Business District (KBD)

Introduction- Initiated in 2000

- Aim to establish a vibrant, sustainable mix-use business district.

- Limited commercial, industrial, entertainment, public facilities and services in Khayelitsha

- One of the poorest suburbs in South Africa

Introduction

- 67% in informal dwellings- Ave. household income - <R 1500 pm- 10% of income on transport- Employed base very small - Security – branded as the most dangerous township in

South Africa


Location (Khayelitsha)

- South of N2 between CBD and Somerset-West.

- Predominately poor area –Mitchells Plain, Delft, Gugulethu, etc.



Location (Khayelitsha BD site)

- Central location- Surrounded by residential - Next to station- 73 ha vacant land - Accessible rail and road


Land rights:

- Spatial framework - Special CBD zone - EIA scoping

In 2001 declared anchor project for National Urban Renewal Programme (URP)


Public participation process:

- Funding from DBSA launched intensive Public Participation Process

- Various community, social structures and organisations were consulted (internal and external)

- Stakeholders’ Framework Agreement - development to create real benefits to the community ito equity, employment and decision-making

- City identified and approved 9 principles for the KBD development

Khayelitsha Business District (KBD)Principles:

- Flexible, innovative and integrated approach.- Sustainable business district which is entrepreneurial,

market driven- Community buy-in and commitment - Community participation, involvement and

empowerment- Community upliftment- Collective responsibility by all stakeholders- Partnerships to be formed- Culturally and socially acceptable- Stimulate tourism development


Challenges for realising the vision:

- Vision proved to be challenge.- Financial institutions regarded Khayelitsha as a

investment risk.- Private sector perceived community involvement as an

additional burden- Private sector had little knowledge of market - Opportunist trying to take over process. - No example / model to work from.


Developing and Marketing of the vision and principles:

- Various workshops to develop concept model- Undertook comprehensive market research (funded by

DBSA) - Marketing of model to private sector organisations

(financial institutions, developers, etc)


Realising the vision:

City and RMB entered into “Cooperation and Collaboration” agreement to deliver:

i) Development Planii) Financial planiii) Institutional Framework


KBD development plan

- To create a better balance between private and public facilities.

- To increase the residential component within the KBD.- To increase range of public facilities.- To concentrate private investments along pedestrian

routes- To intensify land-use (sport stadium and gardens)


KBD development plan

Provides for mix use development:

retailpublic officesprivate officessport facilitiestransport facilitiesresidentialopen spacespedestrian walkways

Khayelitsha Business District (KBD)KBD financial plan (2003)

Note:•Loan funding•Principle of bare dominium of certain buildings to reside with community•Public sector investment ito facilities

R 415 million TOTALR 55 millionEquity

Bulk services & infrastructure, upgrading of electricity, hard and soft landscaping (excl public buildings)

R 90 millionPublic sector

Retail centre, 1 000 residential units, service station, municipal offices

R 265 million *Private sector


KBD Institutional Framework

- Trust to represent community in the developments - Ensure level of decision-making and financial stake for

the community in the development. - Secure the land for the development.- Ability to deliver the developments.- May legally take up loan funding and contract with third

parties. - Sufficiently control by the City and the financiers.

Khayelitsha Business District (KBD)KBD Institutional Framework

Khayelitsha Community Trust - established in Dec 2003 with its main objective to uplift the community of Khayelitsha.

Functions in terms of the Deed of Trust:- Acquire and procure the KBD land (Land Availability Agreement)

- Establish an entity(ies) to develop the land (KManco)- Procure public and community facilities- Promote and facilitate the development- Secure the management of the KBD area- Introduce an empowerment strategy- Raise funds to achieve development - Distribute surplus income to other development projects.

City of Cape Town

Khayelitsha CommunityTrust(KCT)

RMB

Khayelitsha ManagementCompany (Pty) Ltd

(KMANCO)

KBDRetail

Community of

Khayelitsha

Loan facility agreements

Future GrowthFuture GrowthRetail Development agreement

WBHO

Construction Agreement

Retail asset management agreement

SECURITY

CLEANSING

PROMOTION

MAINTENACE

Sale Agreement

Retail land lease agreement

Retail head lease agreement

KBD INSTITUTIONAL FRAMEWORK RETAIL CENTRE

City of Cape Town


Financiers


(KMANCO)

KBDRetail KBD

OfficesKBD

Service station

KBD Housing

Community of

Khayelitsha

Shareholding Management

Property Management

Governance

Budget & Project support

Land availability & Service delivery agreement

Loan funding agreements

KBD INSTITUTIONAL FRAMEWORK

Operational agreements

City of Cape Town


RMB


(KMANCO)

KBDRetail

Community of

Khayelitsha

Loan facility agreements

Future GrowthFuture GrowthRetail Development agreement

WBHO

Construction Agreement

Retail asset management agreement

SECURITY

CLEANSING

PROMOTION

MAINTENACE

Sale Agreement

Retail land lease agreement

Retail head lease agreement

INCOME

KBD INSTITUTIONAL FRAMEWORK RETAIL CENTRE: Income Flow

Khayelitsha Business District (KBD)KBD Development 2002

Road infrastructure and Bulk services

for 50% of the property


Completion of Home Affairs building

70% of services & road infrastructure;

Phase 1 of taxi rank

KBD Development 2005

Khayelitsha Business District (KBD)KBD Development 2003-2004 Cricket oval

Magistrate offices

Social Services

Khayelitsha Business District (KBD)KBD Development 2006/7 (Completion of 20 000m² retail centre)

Khayelitsha Business District (KBD)KBD Development 2009

Hard and soft landscaping

Khayelitsha Business District (KBD)KBD Development (Current projects)

R 112 million, 230 bed regional hospital

R 20 million multi-purpose centre.

Khayelitsha Business District (KBD)KBD Development (Current projects)Residential development

Khayelitsha Business District (KBD)KBD Project:Lost momentum (07-09) due to various factors:

1) Restructuring of municipalities:● Redeployment and breakdown of project office● Integration of budgets.

2) Municipal elections - Political mandate (project, municipal offices)

3) Systems Amendment Act: KCT became municipal entity (compliance, MFMA, new trustees)

4) Economic down-swing (budgets, housing, 2010 focus)


Hospital under construction

Home Affairs Bldg

Social Welfare Bldg

Retail centre

Bus & Taxi facility

Multi-purpose Centre

Magistrate offices

Show village

Cricket oval & swimming pool

Proposed residential

Site for municipal offices

Khayelitsha Business District (KBD)KBD Project: Strategic workshop

1) Capacity of KCT

2) Roles & Responsibilities

3) Communication

4) KBD management

Khayelitsha Business District (KBD)KBD Project:

In 2008, Strategic workshop by KCT,the City and other role players on the current and future development of the KBD.

Khayelitsha Business District (KBD)KBD Project: Strategic workshop

1) Capacity of KCT

2) Roles & Responsibilities

3) Communication

4) KBD management

Khayelitsha Business District (KBD)KBD Project: KBD Management

Number of different role players involved

Various City departments / Future Growth Centre Manager

Coordination, duplication and

KCT ideal position for KBD management responsibility

City of Cape Town


KBD Area Management

(Sect 21)

Community of

Khayelitsha

SECURITY

CLEANSING

PROMOTION

MAINTENACE

Service Level Agreement

KBD AREA MANAGEMENT MODEL

Service Level Agreement

INFORMAL TRADE

INCOME

PRIVATE & PUBLIC

BUILDINGS

Rates

% of rates

% OF LEASE INCOME

COMMERCIAL

LICENCES & FEES VPUU initiative


INTEGRATED APPROACH- Security- Informal trading- Cleansing- Landscape maintenance- Parking- Marketing

KBD Project: KBD Management

QUESTIONS?

Thank you!

Documents

Khayelitsha Business District - National Treasury 4-5 Mar 2010/Khayelitsha... · Property Management City of Cape Town Khayelitsha Business District Planning for the Operation, Management