Port Elizabeth's "slumlord", Irish developer Ken Denton, could lose his 175 properties if the Mandela Bay Development Agency (MBDA) succeeds in a bid to expropriate the buildings.
Denton refuses to repair his properties, which include office buildings, blocks of flats, shopping centres, land and even a school he bought in central Port Elizabeth in the 1990s. Consequently, some of his buildings have slid into what some municipal officials describe as slum conditions.
MBDA CEO Pierre Voges had not considered expropriation until he spoke to the FM. He has now instructed his lawyers to advise him on expropriating Denton's properties and prosecuting him for fire and health law infringements.
Denton did not respond to messages the FM left in his Dublin offices and on his cellphones. Voges says he received an SMS from Denton saying there was no legislation in SA to force him to do anything with his properties.
Many PE residents were impressed when Denton bought the properties, thinking the buying spree signalled a regeneration process. But Denton just bought and held, fixing up only when he could directly enhance his income.
When the MBDA was formed in 2003 to revitalise the CBD and the adjacent harbour area, it soon became clear that Denton was not an enthusiastic participant in its plans.
Phase one of the MBDA's R25 million upgrade plan for Govan Mbeki Avenue, which is in the heart of PE's CBD, includes the historic Market Square and Donkin Street. The only property not renovated on Market Square is Denton's 19th-century post office building, which is standing empty. "He has appointed an architect to make recommendations, but we see no sign of him actually doing something to the building," says Voges.
Using the municipality's eminent domain - the power to take private property against the will of its owner that is fundamental to all states - the MBDA can expropriate Denton's properties in the "public interest" as allowed by section 25 of the constitution's bill of rights. The section requires Denton to get "just and equitable" compensation (in effect, market value). The MBDA can then sell the properties or enter partnerships with developers who will upgrade them.
Some critics say expropriation should be limited to "public use" such as building roads or the Gautrain, not to sell to other private owners. But public use has been stretched in most countries to "public good", which includes selling to private developers if their projects are for wider benefit.
For instance, the British government is expropriating land for urban regeneration around the new Wembley soccer stadium in London and the 2012 Olympic Games site. Much of it will end up in private hands.
Financial Mail
Publisher: I-Net Bridge
Source: I-Net Bridge
