Property & Wealth

Land restitution also adds value to mainstream market

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The policy of land restitution to deal with past injustices is a very emotional issue, but at times it also adds a fresh layer of value to South Africa’s mainstream real estate market. (Read more)prov

This was well illustrated recently in the Western Cape, which seems to be well ahead of other provinces in settling land restitution claims.

The Africa Property News recently reminded its readers that in 1972 approximately 400 (then called Coloured) families were forcibly removed from an 84-hectare piece of land in Milnerton, adjacent to the N7 highway in Cape Town. These families were subsequently resettled in Atlantis and across the Cape Flats.

This sad event from history, however, recently turned into a story with a happy ending.

The land in question occupies a prime position in the fast-expanding and lucrative Cape Town real estate market and became the subject of a successful land restitution claim by the some 5 000 descendants, spanning five generations, of the families originally removed from the land and resettled in much less well-placed land.

In December 2014 they finally had the land transferred back to them – following a landmark land restitution settlement – into a community trust, the Richmond Park Communal Property Association. Significantly, the property had bulk development rights.

It comes as no surprise, then, that the Communal Property Association decided to lease their prize asset to a consortium of developers headed up by Atterbury Properties (part-owned by the listed Attacq property fund) in association with two local community developers, Bethel Property and Qubic 3 Dimensional Property.

While Atterbury is the main shareholder, the Communal Property Association also has a direct 25% interest in the consortium, aptly named the Richmond Park Development Company.

The consortium’s ultimate aim is to develop a multimillion rand business park and mixed-use building project, consisting of commercial, retail, light industrial, retail and warehousing properties.

The upshot is that over the next five to10 years, the developers are committed to invest $365 million (that's ZAR R5 billion!) in this mega-development, which will add significant value to the industrial hub of Milnerton, to the profits of the consortium and ultimately, to the well-being of the originally displaced community.

This news comes hard on the heels of the Land Restitution figures recently released in the Annual Report of the Commission on the Restitution of Land Rights, which confirmed that the Western Cape has the country's highest number of total settled land claims – 192 claims to a value of R1.5 billion.

It is heart-warming to see that land restitution is not only succeeding in redressing the injustices and wrongs of the past, but is also directly contributing to the growth of the economy and the creation of many, many sustainable jobs in an area where and at a time when they are sorely needed.

by Eve van Basten

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