Mercury: City threatens big land grab

Abahlali baseMjondolo has been demanding the expropriation of Tongaat-Hulett land since 2005. But nothing came of the city’s announcement of a big housing development just before the 2006 local government elections. And if this does happen there are no assurances that it won’t just be more top down planning that doesn’t meet people’s needs and is riddled with the politics of patronage at every level, including the allocation of the houses.

http://www.themercury.co.za/?fArticleId=4567545

Low-cost housing at umhlanga becomes election issue
City threatens big land grab

August 20, 2008 Edition 1

Matthew Savides

THE eThekwini Municipality yesterday threatened to expropriate 1 200ha of Tongaat-Hulett Developments-owned sugar cane fields to fast-track a massive low-income integrated housing development near Umhlanga.

It emerged from a report presented to the municipality’s executive committee, and elaborated upon at a subsequent ANC press conference, that councillors are frustrated by the pace of negotiations over the giant development.

However, a property specialist warned that rushing into building thousands of low-cost homes, ahead of the 2009 election and without the balance of “mixed usage”, could have disastrous results on the values of surrounding properties.

Housing committee chairman S’bu Gumede said that expropriating the land would be an option “in the next two or three months” if an agreement could not be reached with Tongaat-Hulett over the huge Cornubia development.

However, he stressed, expropriation was not the first choice.

The proposed development area – which could accommodate up to 75 000 building units as well as many other property uses – is bordered by the N2 highway to the east, the R102 to the west and the Ohlange River to the north.

It is also in close proximity to the Gateway shopping complex, Sibaya casino and King Shaka international airport.

A property specialist, who asked not to be named, said if properly planned and handled, the Cornubia development could become a model for integrated living between people of various race and income groups.

On the other hand, if the construction of 15 000 low-cost “Smarties box-type” homes was rushed through and not properly planned, it would become a financial and human disaster – resulting in the value of other properties in the suburb plunging by as much as 50%. The opposition DA cautioned that apparent fast-tracking of the development was an electioneering tactic.

Municipal manager Michael Sutcliffe described the area as “bigger than many towns”, and indicated that he felt a fully integrated plan was the best way to go.

This would see low, middle and high-income houses being coupled with industry, business, schools, clinics, parks and other public service infrastructure. This would assist in job-creation and ensure the project’s long-term sustainability.

Sutcliffe said expropriation was an option, but the municipality and Tongaat-Hulett were close to signing a memorandum of understanding that would see the development take off. The final agreement could be signed in the next few months.

The issue hit the headlines in 2005 when eThekwini Mayor Obed Mlaba announced the development, saying it would cost about R10 billion.

Mlaba said yesterday the matter had dragged on for many years and it was now time to secure the land to get the development off the ground.

At least 25 000 homes were planned for the site, which could yield as many as 73 000 units. Fifteen thousand of the homes would be reserved for people earning less that R1 500 a month, with the remainder for those earning between R1 500 and R3 500.

The report said Tongaat-Hulett was insisting the land be used for more than just housing, to make it sustainable.

Mlaba said expropriation was “not only an option, but a must” if the company did not agree with the municipality.

DA caucus leader John Steenhuisen said it was wrong to negotiate while threatening expropriation as this was in bad faith.

He said the threat should only be used if negotiations broke down completely. It could also damage the relationship between Tongaat-Hulett and the municipality, which had resulted in other major developments, including Durban’s Point precinct.

Sutcliffe said the DA was misreading the situation, saying expropriation was contained in the report as one of the options available.

“This is a programme that promises development, (which) will come either through negotiation, or through us buying the land, or through expropriation. All it is is a case of us not putting all our eggs in one basket.”

If expropriation took place, some of the land would be developed for low-cost housing and the remainder sent out for public tender.

In a January Business Report article, Tongaat-Hulett Developments executive Mike Deighton said land sales for the property would take place towards the end of 2009.

But Gumede said the council would not be held to Tongaat-Hulett’s timeframes.

He said when people asked the ANC about promises it made, the party would be able to show them the work being done on the site, a hint that elections were a factor.

According to sources close to the negotiations, one of the biggest areas of contention was the municipality’s insistence on having 15 000 low-cost houses.

Tongaat-Hulett was insisting on a fully integrated development comprising many different land uses, and to do this effectively it was necessary to decide on the number of low-cost houses as the development was planned in greater detail.

Unless this was done, the people who moved into the low-cost houses would not have any chance of economic upliftment. In essence, the development would amount to the creation of another poor, informal settlement in the mould of neighbouring Waterloo.

Also, developers who were responsible for the bigger, more lucrative developments would be prepared to cross-subsidise the cheaper housing forms and public service infrastructure because of the money they stood to make.

Apparently there was agreement in this regard from city officials, including Sutcliffe, but the political officials were so focused on the housing numbers issue that they were not prepared to budge to make the project sustainable.

Sutcliffe said the final layout would result in some areas being residential while others were more integrated.

“We will test out different models and see what works best. This is a huge piece of land, and there are a variety of options for use,” he said.

Sutcliffe said it was difficult to estimate when the development would begin because of all the options. He expected basic details to be finalised “in the next few weeks”.