Groundbreaking decision enables extension of development rights
The Western Cape Property Development Forum (WCPDF) this week learnt that the National Minister of Agriculture, Land Reform and Rural Development, Thoko Didiza, has extended an olive branch to property developers in the Western Cape. This is in response to ongoing calls to limit the red tape that has been stifling the property and construction industry and impacting severely on much-needed job creation.
In January this year, the Western Cape Government was informed that an exemption to the Spatial Land Use Management Act (SPLUMA) of 2013, has been granted – the Act being the one that most notably informs development rights countrywide. This Act has previously imposed a five-year restriction on the validity of land use rights for development. The exemption will now instead enable Western Cape municipalities to amend their own planning bylaws so as to permit the granting of development rights for a period of 10 years.
Calling Minister Didiza’s exemption a “defining move that will first and foremost stimulate much-needed investment”, Deon van Zyl, Chairperson of the Western Cape Property Development Forum (WCPDF) adds: “Following an era of bureaucratic red tape that has decimated not only the property development and construction industry but also the economy, the Minister’s decision represents a paradigm shift in government thinking and a true indication that government is now sincerely on a road to rebuild the nation.”
In the past, SPLUMA’s restrictions resulted in a “use it or lose it” situation with development rights lapsing within the five-year period. This resulted in developers having to reapply for rights from the start, with no guarantees of reapprovals, and at a time when other onerous conditions from heritage approvals to environmental impact assessments stretching the initial project development phases alone to eight years or more.
This expanded timespan was revealed last year in a research project (known as the Property Development Process Model), conducted in collaboration between the University of Cape Town’s Urban Real Estate Research Unit (URERU) and the WCPDF.
Explains Van Zyl: “With the obtaining of such rights being a high-risk, costly and time-consuming process to begin with, SPLUMA’s timeframe actively undermined new development applications on complex and long-term developments, both for the public and private sector alike.
“By allowing for an extended period of 10 years validity, Minister Didiza’s decision has given real support to an industry currently on its knees, and yet which is vital not only for private development but the creation of much needed government infrastructure.”
Van Zyl believes the move is the result of numerous industry bodies “having worked tirelessly” over the past few years with the Western Cape Government to lobby National Government. Along with WCPDF, these have included the South African Property Owners Association (SAPOA), the South African Association of Consulting Professional Planners (SAACPP), the Cape Institute of Architects and the Cape Chamber of Commerce and Industry.
Calling the move an unprecedented example for the property industry of co-operation between National and Western Cape Provincial Governments, Van Zyl further called on Western Cape Municipalities to adopt and incorporate the extended development rights period into their own respective bylaws without delay in order to support critical investment and economic growth into the region.
“National Government has shown its support to the industry by granting the Western Cape this time exemption,” notes Van Zyl. “This has now moved the challenge to municipalities to step up to the plate as soon as possible.”
In the meantime, notes Van Zyl: “The industry owes a huge measure of thanks not only to Minister Didiza but also to Western Cape MEC Anton Bredell and the various national and provincial officials who have worked behind the scenes to make this exemption a reality.
“This is an issue that has long been of great concern to the development industry and investors. It is a prime example of the type of collaboration between National and Regional government we now need to see to restore investment confidence back into the country, and place political gameplaying on the sidelines where it belongs as we recover.”