Joburg's R20-billion housing project expected to be a failure

The release of some 97 Joburg properties at a value of R20-billion, mostly in Orange Grove and Houghton, is set to be a failure.

So said chairperson of the Norwood/Orchards Residents’ Association, Brett McDougall, who added that some 26 of the properties on tender had been hijacked from the Joburg Property Company (JPC) last year. The properties had initially been purchased in 2014 for redevelopment along the Louis Botha Avenue Rea Vaya Corridor of Freedom and had been temporarily rented out until the city was ready to utilise them for community projects.

However, in a series of protests last year, which saw the burning of tyres and blocking of Louis Botha Avenue, many of the houses were raided, especially those with alleged illegal foreigners occupying them, who were thrown out. What is making the situation difficult, said McDougall, was that the city was imposing a condition in the release of the properties - the prospective purchasers would bear the onus of evicting the illegal occupiers.

“This will entail months, probably years, of legal action which will ultimately not be cost effective for prospective developers,” he said, adding he believed this would put buyers off. Residents in the area say the area looks like a “war zone, with illegal electricity connections, rubbish in the streets, and frequent battles between factions of hijackers”. Some of these properties, many of which are grouped into large portions of land, are being released across several regions, including Randburg, Rosebank, Houghton and Wynberg.

The aim is to establish mixed-use developments, affordable housing and student accommodation. Among the properties released will be one in Rosebank, which is experiencing a development boom similar to Sandton, and is earmarked for a R400m investment which will create 2000 jobs and will see a 12-storey mixed-use development with 250 residential units and a 600m² library.

At the official release last month, mayor Herman Mashaba said although the revitalisation of the Joburg inner city was crucial to economic growth, the development of areas around the city was equally important. “The development we are aiming for in the inner city must be transferred to other parts of Joburg. Areas such as Roodepoort and Randburg, which have declined as a direct consequence of neglect and a flight of capital, must be brought back to life through massive investment in infrastructure and properties for business opportunities.

“These developments will be of particular importance as they will include the recently-approved inclusionary housing policy, which requires developers to dedicate a percentage of new residential developments for affordable housing. This is an important step as the city seeks to address the spatial inequality associated with apartheid-era development planning.” Among these properties are various filling stations in Soweto and Denver, with expected investment value of approximately R100m.

However, three of the properties now up for tender include three petrol stations in Soweto that have been operating on their premises for 25 years. The business owners have repeatedly asked the council for long-term leases for these properties, and while promises were made, the business owners continue to pay their rent on a month-to-month basis. Fanny Mokoena, who owns an Engen garage in Meadowlands, is deeply concerned: “I have been told that my business is up for sale, without any consultation with me. It effectively means they’re putting my business up for tender. I can’t move a petrol station to another location. Also, what will happen to my employees? This just doesn’t make any sense at all.”

Mokoena said she had been attempting to get the title deeds for years: “I have been paying R15000 a month rent to the JPC - now they say the rent is going up to R39000, even going back on their promises of my first right of approval to purchase the land,” she said. The city did not respond to The Star’s queries.