Investments valued at a staggering R1 billion have been pumped into Durban's inner-city Urban Development Zone (UDZ), arresting decay and contributing to the restoration of the city's high-profile business and residential status.

A number of investors, taking advantage of the Government's Urban Development Zone tax-break scheme, have linked with the eThekwini Municipality, which has released certain strategic land parcels for development, to effectively change the face of Durban's Central Business District (CBD). The legislation was introduced to regenerate the CBDs of South Africa's cities and calls are being made to extend the scheme's March 2009 cut-off to maximise the benefits of inner-city regeneration.

The eThekwini Municipality regards the investment turn-around in Durban as indicative of the success of the of the UDZ incentive scheme in the city. Head of eThekwini Municipality's Strategic Projects Unit (SPU), Ms Julie-May Ellingson, said of the scheme: "It has been a tremendous success in Durban to date, attracting some R1 billion in capital investment within the city's UDZ and this has had the effect of attracting further additional investment in areas outside the zone, supporting initiatives already in place, such as uShaka Marine and the booming Point Development."

Durban has emerged as a hub of investment activity, driven by the city's dedicated approach to CBD regeneration and its events-led strategy, geared toward attracting major sports and tourism events, improving inner-city transport systems and developing related infrastructure.

Ms Ellingson added: "The successful regeneration of Durban's CBD has been, and continues to be, a partnership between the private and public sectors and clearly indicates the confidence investors and developers have in our city."

Many investors are set to benefit from the incentive scheme, including leading financial institutions, such as ABSA, Standard Bank and Old Mutual Properties. Impressive building upgrades are being undertaken at a number of sites on West Street, the city's central arterial, including the re-development of retail space in both the Colonial Building the JBS Building. In addition, developers are benefiting from the strategic release of council-owned land, inclusive of Kingsmead Office Park, Hoy Park and areas close to Durban's international convention centre, opening the door to the emergence of a new business hub on the north-east fringes of the CBD. Inner-city regeneration has been greatly strengthened by ABSA's decision to retain its KwaZulu-Natal Regional Office in the city centre. The financial institution has committed an estimated R82 million to upgrading its 291 Smith Street premises.

Mr Alan Botha, KwaZulu-Natal Regional Manager for ABSA REAM Property Solutions, said: "The project commenced in January 2005. The final product will see ABSA Bank accommodated in an `A-Grade' ABSA Regional Office building. Not only will ABSA Bank be prominently and proudly visible in the CBD, but we will also be able to control such issues as rentals, security, maintenance and cleaning."

The upgrade included external building refurbishment, construction of a new parking garage, provision of additional floor space and foyer and office floor renovation. Critical to the city's regeneration is the transformation of the depressed Warwick Junction area. At the heart of the city's Warwick Junction Precinct Plan is a R400 million investment for constructing Warwick Mall, a private development, complimented by an eThekwini Municipality contribution of a comprehensive taxi rank. The project is to be developed by Warwick Mall (Pty) Ltd, a Durban-based Black empowerment company specialising in property. Company Chief Executive Officer, Mr Carlos Correia, said: "Warwick Mall, which will straddle the railway lines at Berea Station, is the catalyst for the entire precinct plan and introduces a vast new retail element to the Warwick Junction inter-modal transport node."

The 22 000 square metre mall is a bold and aesthetically pleasing use of space and will be conveniently located between the railway lines below and a 500-bay taxi rank above. eThekwini Mayor, Cllr Obed Mlaba, commented: "The time is right for investors to buy buildings in Albert Park and Warwick Triangle. I would like to see more buildings being sold to African people who, in spite of constituting 70% of the population, were sidelined from the economy."

A number of Black-owned development companies are successfully taking on the ambitious residential property upgrades of a number of the inner-city's most notorious buildings in the Warwick Triangle area, including Hampson Court and semi-detached housing in Bentley Road. Such re-development is creating new liveable space for, especially, students and family units. Meanwhile, another private small-scale investor has transformed an over-crowded slum close to the city's international convention centre into middle-market bed-and-breakfast accommodation aimed at the conference market generated by the adjacent ICC.

A further success is the JBS Building which had fallen into disrepair. The building has been renovated, bringing on stream retail space on the first two floors and attracting Mr Price as a retail tenant. Developer Mr Ivor Smith said: "The first four storeys will be commercial and the rest of the block will be renovated to house residential tenants. The first phase is complete."

A number of role-players in the UDZ scheme, from local government to developers, have, however, voiced concern that projects with lead times in excess of a year can no longer take advantage of the tax incentive currently on offer by Government. The present scheme expires in March next year. City representatives from across the country, National Treasury, the South African Revenue Services and SAPOA are meeting at the Inkosi Albert Luthuli ICC in Durban today to workshop the impact of the UDZ scheme to date and, critically, to discuss its future.

Ms Ellingson said: "We hope that recommendations generated at this workshop will result in an extension to the UDZ tax-break scheme expiry date, so allowing developers who have committed to enterprises in Durban, and cities around the country, to complete their projects and still qualify for the tax incentives for which the scheme provides and for which it was introduced."

For more images, copy of the workshop presentation or more information on the UDZ scheme, contact:

Ms Fikile Ndlovu
eThekwini Municipality
Strategic Projects Unit, Loram House, 70 Masabalala Yengwa Avenue,
Durban
Tel: 031 311 4731
Fax: 031 311 4727
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.