SPEECH BY THE CITY’S MAYORAL COMMITTEE MEMBER FOR TRANSPORT AND URBAN DEVELOPMENT, COUNCILLOR BRETT HERRON AT THE FOURTH ANNUAL AFFORDABLE HOUSING AFRICA CONFERENCE, 18 JULY 2017

Where people live matters.

This statement underpins the entire focus of the City of Cape Town’s Transport and Urban Development Authority (TDA).

Six months ago I assumed political responsibility for the oversight of the TDA. Today I am proud to discuss our first steps in creating new, affordable well-located housing opportunities for our residents that will begin to reverse the tragic spatial impacts of apartheid.

Apartheid spatial planning consigned the majority of Capetonians to settlements far away from work, where residents had access to limited services and opportunities.

Apart from creating a fragmented city, apartheid spatial planning was also characterised by little or no investment to stimulate economic activity in these settlements.

We must acknowledge that, to date, our efforts to radically transform Cape Town’s spatial reality to enable all of our residents to participate more equally in the local economy have fallen short.

The dire need for housing for Cape Town’s most vulnerable households is the single biggest challenge we are facing as a local government today.

We estimate that approximately 650 000 families earning less than R13 000 a month will rely on us for some kind of assistance for housing between now and 2032. This is partly as a result of unemployment, slow economic growth, and rapid urbanisation – Cape Town’s population has increased by 56% between 1996 and 2016. This trend is set to continue.

Furthermore, our task is exacerbated by the unprecedented growth in the property market in areas close to key nodes of employment, and along public transport routes.

The investment affirms that Cape Town is a city that works and that more and more South Africans opt to settle here. The flipside of the coin is, however, that inequality is worsened when these investments mostly benefit those who already have access to the free market economy and employment opportunities.

As much as we welcome the investment, there is an obligation on the City and on the private sector to ensure that the inner-city and other central business districts are accessible and affordable to those who are still living on the periphery. This obligation stems from the commitment that is required from all of us to make Cape Town an inclusive and liveable space where there is room for everyone, and where we share equal access to opportunities, regardless of race and income.

The City must also mitigate against the displacement of residents, especially tenants in rental properties, who have lived their entire lives in suburbs like Woodstock and Salt River where high-end developments are rising at a rapid pace because of the proximity to the Cape Town central business district (CBD).

When the Transport and Urban Development Authority was established on 1 January this year, we said that the City must turn a corner in our approach to affordable housing. We said that from now on we will leverage City-owned assets such as land and property to achieve spatial transformation to create an inclusive urban fabric.

We made a commitment to do everything within our means to expedite new housing developments that are inclusive and to ensure that housing opportunities for lower-income households are situated on well-located land, close to places of employment and social amenities.

Part of the undertaking is to, within our means, provide those who are facing emergency situations with safe, decent, and affordable temporary housing as close as possible to where they are working; or at least as close as possible to where they can get onto a bus, train or minibus-taxi.

Over the past few months we have been working to make this commitment a reality and today I can announce that we have identified 10 City-owned sites in the city centre, Salt River and Woodstock to be used for affordable housing opportunities for those who need it most.

Three of these sites have already been allocated to social housing institutions. The statutory land-use applications are under way and we expect construction to commence in due course:

  • Two erven along Pine Road and six erven along Dillon Lane. The Pine Road development will commence first, with the Dillon Lane development as the second phase. The proposed development will be between two and four storeys, with a mixture of studio, one-, and two-bedroom units. Together these two sites will provide approximately 240 social housing residential units, meaning it is State-subsidised rental housing for households with a monthly income of less than R15 000. Beneficiaries must be registered on the City’s housing database and willing and able to pay rent.
  • The development of the Salt River Market in Albert Road will provide a combination of approximately 476 affordable housing opportunities – from social housing (subsidised rental units for households with a monthly income of less than R15 000) to GAP rental housing (for households with a monthly income of between R3 500 and R20 000). Beneficiaries must be registered on the City’s housing database and willing and able to pay rent. Retail and office space will form part of the development to cross-subsidise the housing opportunities and to ensure its long-term financial sustainability

Furthermore, we intend to develop the City of Cape Town’s very first inner-city transitional housing project in Salt River, less than 5 km from the Cape Town CBD. More information about the development of this site will be available once we have acquired Council’s approval at the next Council meeting on 27 July 2017.

The proposed development of the Salt River site is only the first; there are more transitional housing projects in the pipeline – in Salt River, as well as in other areas in Cape Town. In fact, our officials are doing an audit of City-owned land parcels in Goodwood and Bellville. We will confirm the locations once we have established that the potential sites are suitable to include transitional housing.

Last year in the run-up to the local government elections we made a commitment to do everything within our power to expedite inclusionary housing developments and to ensure that housing opportunities for lower-income households are situated close to places of employment and social amenities.

Apart from sites intended for transitional housing and social housing mentioned above, we have also identified five City-owned land parcels for the development of affordable housing opportunities in Salt River, Woodstock, and the inner-city.

The manner in which we are approaching these developments represents a 180-degree change in how we will confront the urgent demand for affordable and inclusionary housing in future.

We are moving away from a piecemeal development approach towards a Precinct Development Approach which is to be applied first in these inner-city areas. This is a strategic change in line with the City’s transit-oriented development strategic framework that emphasises the need for densification and intensification in transit-accessible precincts – thus, well-located precincts that are close to public transport and employment opportunities.

Importantly, from now on the City will also apply an investment-like approach, where appropriate, in developing City-owned sites for housing opportunities.

This means we will, as is the case with the Foreshore Freeway Precinct, make City-owned land parcels available to prospective bidders from the private sector for development.

When it comes to inclusive and affordable housing, however, the TDA will employ other financial and related investment mechanisms to ensure that these housing opportunities are not outpriced and are integrated within the communities where they are located.

In so doing, the City is signalling that affordable housing is not merely the provision of units to lower-income households, but a long-term investment in our urban fabric and form.

We are committed to delivering high quality housing which will improve residents’ living standards. We will apply methodologies, typologies and architecture, as well as energy and water-saving design methods to enhance and rejuvenate our central business districts and suburbs which, in the end, must attract further investment from the private sector.

The prospectus for the development of the five sites in the city centre, Woodstock and Salt River will be issued within the next two months, save to say that it will encourage ‘tenure-blind’ affordable housing developments where the design of the overall development is integrated into the surrounding area and does not distinguish between the differences in income and tenure within the development.

We want these developments to offer a mixture of affordable housing typologies, including social housing, combined with market-related housing (for those who can pay).

In some instances, we would also encourage mixed-use developments – thus, a combination of residential and retail and commercial units so that the business units can cross-subsidise the affordable housing units, in so doing ensuring the long-term sustainability of the development.

The details of the sites and all of the other information that bidders may need in devising and submitting their proposals will be presented in the prospectus.

Again, once issued, the approach will mirror the one that we have followed in the proposed development of the Foreshore Freeway Precinct.

The precinct-led development in Woodstock and Salt River is a pivotal introduction to a customer-centric approach to housing delivery. It is a new way of doing business which we will apply in all of the other precincts where we intend to provide affordable and inclusionary housing on City-owned land.

The prospectus will be a public document so that all residents and interested and affected parties can have access to all of the available information.

Going hand-in-hand with this approach is the message that we need our residents, the private sector, and non-governmental organisations in the housing realm to support us.

To conclude, in 2016 Council adopted the City’s new Organisational Development and Transformation Plan which reoriented the administration to be more customer-centric. This chartered a new course for the City to apply a transformational, data-driven implementation agenda in the years ahead in addressing the socio-economic challenges and transport inefficiencies that are reflected in the built environment due to apartheid spatial planning.

To reiterate: we will, in line with our transit-oriented development strategic framework, identify housing opportunities closer to our MyCiTi stations and rail stations.

The City is also developing a strategy for the provision of housing opportunities in all of the central business districts – not only the Cape Town CBD, Salt River and Woodstock, but also in smaller inner-cities such as Bellville, Parow, Khayelitsha, Claremont, Mitchells Plain, Wynberg and Plumstead.

Not only will we identify suitable land, but also buildings within these CBDs that can be developed or converted into affordable rental accommodation.

Providing affordable housing opportunities closer to where people work or close to public transport is non-negotiable. In this way, we will create a more integrated and inclusive city where residents have equal access to opportunities.

As I have stated, where people live matters.

There are ample opportunities for affordable housing in many areas across the metro, and the development and availability of affordable rental accommodation in central areas of the city must play a key role in the future development of Cape Town.

Also, on 20 June 2017 the City announced that we are seeking more social housing partners to up-scale and expedite affordable housing opportunities on well-located land across Cape Town.

The City currently has partnership agreements with five social housing companies to develop and manage affordable rental housing stock for lower- and middle-income residents.

Given the acute demand for affordable housing, the City needs more social housing partners to help us up-scale and expedite the number of opportunities delivered in the short- to medium-term.

Releasing more of the City’s land for social housing development will provide us and our new social housing partners with the ideal opportunity to work together to increase the delivery of affordable housing opportunities.

The City is therefore seeking to enter into partnership agreements with more companies who are accredited with the Social Housing Regulatory Authority (SHRA) as stipulated by the Social Housing Act in order to increase the capacity and pace at which housing can be delivered.

We want to sign full partnership agreements with companies that are already experienced in developing and managing their own rental stock, but we are also looking for conditional partners who will be given capacity support to develop and manage their first projects. Once they have proven their ability to deliver, their agreements may be transitioned into full partnerships with the City.

Companies who are accredited with the SHRA and interested in entering into partnerships with the City have been requested to register on the City’s social housing database before the end of this month.

We want partners who are just as committed as we are to addressing the critical need for housing. They must be obsessive about delivery and quality, and they must be willing to serve the beneficiaries of these projects with passion.

This term of office is about implementation.

There is no room for delays, and so there can and will be no pause in the execution of service delivery.

We are determined and committed to make Cape Town an inclusive city.

We need a similar commitment from developers in the private sector to assist us in providing inclusionary housing on well-located land. I am eager to get their proposals on how they intend to do things differently going forward.

There are no quick fixes and change does not happen overnight, but this is a start.