Cape Town revitalisation

CAPE TOWN - Eerste River, a suburb about 45km from Cape Town and bordering the Stellenbosch Winelands is to be the beneficiary of a R170m investment by the global private-equity firm, International Housing Solutions (IHS). About 441 new homes and 31 shops will be built in this fast growing suburb. The suburb's high employment rate means it is facing a housing shortage and with many of the residents in a position to rent or buy, IHS has chosen Eerste River to make its first foray into the Western Cape. The apartments will range in price from R250 000 to R499 000. There will also be 31 retail spaces.

IHS have partnered with Frans De Jongh of Jumbo properties on the project after identifying the demand for suitable housing in the area. IHS manages a R2bn fund and has funded more than 20 000 affordable units in the Gauteng region already. It focuses on primarily affordable housing projects and is responsible for the revitalisation of old derelict blocks, like the Greatermans and Stuttafords buildings in the Johannesburg CBD. It has also developed a number of Integrated Living Projects in Soweto, resulting in more than 11 000 new units being built. Their funding comes from both North American and Southern African organisations including Citibank, the Development Bank of SA and Overseas Private Investment Corporation (OPIC).

Soula Proxenos, managing partner of IHS says it "designs houses for people and communities for people. We like to do good but we do have a fiduciary responsibility to our shareholders." She also explained that particularly in the Johannesburg CBD, the properties were so cheap as to make conversions of bulk affordable housing relatively cheap to do.

Proxenos says that access to finance (or lack thereof) is driving consumers to rent and many of their projects are aimed at the rental market or the buy to let market.

While this is the funds first entry into the Cape market it recognises the housing backlog problem and hopes to close some more deals before the end of the year to facilitate development in the region. These include plans to build 3 000 units near Mitchells Plain, and a project to be built near the University of the Western Cape.

Also present at the media discussion was Mokena Makeka, who at 33 years old is fast making his name for himself as a designer/architect to watch out for. He is the man behind the redesign of Cape Town Station which forms part of the new public transport system. Makeka founded his own business after completing his studies and has already won numerous awards for his design work.

Makeka spoke about maximising Cape Town's space and explained that we do have space in the inner city, we just need to utilise it properly. He is also involved with a project currently under review which would sink Cape Town's city railway lines underground leaving the space above available for development. He explained that good developments need the right people, skills and decision makers to come together. He said that company's like IHS bridge the gap between the private sector and government and although he had just met Proxenos, don't bet against the two of them collaborating on projects sometime soon.

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