Resource information
Developers study the property market carefully and then, based on the property cycle, and risk and profit calculations, they acquire land and develop it, with a specific product in mind. Municipalities play a governance role, and are mandated to ensure that the development is in line with government policies and development plans for the area.
Deciding whether to submit land development applications to the municipality via the Ordinance route, or to the provincial government via the Development Facilitation Act 1995 (DFA) route, is pivotal in terms of what, how, when and where development will take place.
This case study draws on research that sought to understand the process of urban land development in practice, from the perspectives of developers and municipalities. The case study focuses on large development companies and consortia involved in different types of development, with specific reference to three development projects in Gauteng province (Waterberg Golf and Wildlife Estate, Cosmo City, Johannesburg and Jabulani Mall, Soweto)
Developing urban land is a complex process that depends on a variety of political, social and economic factors. Some of the key factors that influence decision-making in development projects are:
the level of political support for the project, for example there was strong political support for both Jabulani Mall and Cosmo City in Gauteng province
ability of the developer to sell the plan to the municipality as meeting broader social objectives
ability to mediate between the multiple agendas of stakeholders
the networks and relationships between municipalities, planning consultants, developers and other stakeholders
the ability to identify and move in on niche markets, in order not to miss out on a profitable venture
the availability of capital, which is a requirement in all development projects
ownership of and access to land
the development has to comply with government regulations relating to Environmental Impact Assessments and Social Impact Assessments and policies related to land use planning
Some of the recommendations the study proposes are:
municipalities should take initiative and make suggestions for how the development could be made more sustainable, inclusive and functional, to act more as development facilitators
planners should develop plans with municipal officials to ensure there is agreement as to how the plan could focus on inclusiveness, equity and sustainability
politicians should focus on developing and popularising municipalities’ policies rather than playing a major role in decision-making regarding development projects, since they often lack the technical knowledge to make informed decisions
