Western Cape Business News

Send  Share  RSS  Twitter  26 Jan 2009

DEVELOPMENT: Building Plan Shows Results


Recent Western Cape Business News

The third stage of the co-operation agreement signed three years ago between the City of Cape Town and three major banks - Absa, Nedbank and Standard Bank - to provide affordable housing for the middle income group, reached fruition Friday, 23 January 2009, when Standard Bank started the full development of the sites earmarked for two housing projects in Elsies River.

Councillor Dan Plato, the City’s Mayoral Committee Member for Housing, was present at an on-site ceremony to mark this milestone.

The City of Cape Town/Banks co-operation agreement was concluded on 16 May 2006. This was the first operational and tangible partnership between a local authority and the major national banks. The rationale underpinning the agreement is that the City allocates appropriate land to the banks to facilitate the development of affordable housing and the banks provide the finance and development expertise.

The key element of this initiative is to make affordable and aesthetically pleasing “gap” market housing a reality for many households earning R3500 – R10 000 per month.  

The new housing complex will be called Leo Mews as it is situated in Leonsdale in Elsies River.

Executive Mayor Helen Zille said: “The land will be transferred directly to the people buying the houses. The prospective owners will negotiate directly with the bank. This will keep the land price down and we will prioritise people who are on our housing lists and meet the income criteria.”

“One of the key drivers of Standard Bank’s approach to housing is that we are no longer merely providing finance, but doing whatever is required to produce housing opportunities to the Financial Services Charter [FSC] target market.

Our mandate is to not only address immediate housing challenges, but to build a future customer base and facilitate a sustainable environment in which all South Africans can prosper.

The partnership with the City of Cape Town is an example of the many partnerships that we hope to foster in the future,” says Kevin Duncan, Managing Director of Standard Bank’s Integrated Residential Developments Division (IRDev).

The Elsies River sites, located on 11th and 22nd Avenue, include only two of the tracts of the land allocated for affordable housing to the Standard Bank and the other partners

The environmentally friendly and efficient development of these sites will enhance the neighbourhood.

The site layout is based on medium density designs, off-street parking, security access and area greening (trees).

There are 125 units in 11th Avenue (primary target market: R3500 – R10 000 per month household income) and 75 units in 22nd Avenue.

David Williams, marketing manager for Bitol Ltd, developers of the Leo Mews complex in Elsies River, said: “It is a secure complex offering two bedroom apartments to households earning below R10 000 per month. This market forms part of the 2003 FSC, in which the banking sector committed to originating loans to low-income households totalling R42 billion over the five-year period.

It provides a housing product catering directly for this market as the demand for housing far exceeds supply in this segment. Traditionally, developers positioned themselves in the million rand plus market where the property boom experienced the best returns, but has subsequently deflated following the rise in interest rates and present economic climate.  The affordable market remains overlooked and has generated a pent up demand for housing products for new entrants into the home market and low-income earners.

“Apart from the selling price, this development would not be out of place in any affluent suburb of Cape Town. To further assist home owners in their day-to-day running costs, all units are provided with solar water heating systems as well as a grey water system to service the garden and landscaping in the development.  The development includes a water recovery system. It filters rain and grey water and then introduces it into the toilet system, saving on water usage and costs.”

The development of affordable housing under the City/Banks co-operation agreement is just one of the City’s housing delivery interventions. Others include: the development of social housing, upgrading informal settlements, the development of affordable housing by developers, the developing of subsidy (RDP) housing, the hostel re-development programme and emergency housing programmes.

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