REAL ESTATE DEVELOPMENT AND MANAGEMENT IN BORDER TOWNS

1. REAL ESTATE DEVELOPMENT AND MANAGEMENT IN BORDER TOWNS ZIRUP 2013 ANNUAL SCHOOL, BEITBRIDGE Audrey Kwangwama, Immediate Past President of The Real Estate Institute of Zimbabwe (REIZ)

2. What is land? • It is the surface of the earth • The source of all minerals, vegetable matter and animals • The foundation for social, political and economic activities • A commodity as well as a source of wealth (ULI 2007) Under all is land

3. Attributes of land • Each parcel of land is unique in its location and composition • Land is fixed • Land is durable • Land supply is finite – the need for efficient and effective management • Land is vital to people

4. Definition of real estate • “Land or resources embodied in land” (Jack Harvey 1992) • “The physical land and appurtenances affixed to the land” ( The Appraisal Institute 1992) • Real Property – All interests, benefits and rights inherent in the ownership of physical real estate

5. Government limitations to real estate • Taxation • Eminent Domain • Police Power • Escheat

6. Taxation • The right of government to raise revenue through assessment on valuable goods, products and rights • Border towns – payment of rates to local authorities

7. Eminent Domain • The right of government to take private property for public use upon payment of just compensation • Compulsory land acquisition for urban development • Allocation of acquired land to border towns for urban development

8. Police power • The right of government under which property is regulated to protect public safety, health, morals and general welfare: - Zoning ordinances - Use restrictions - Building codes - Air and land traffic regulations - Access rights -Health regulations

9. Escheat • The right of government that gives the state title ownership of a property when its owner dies without a will or any ascertainable heirs

10. Real Estate Development • Continual reconfiguration of the built environment to meet society’s needs ( Urban Land Institute 2007) - Construction of roads - Water reticulation and treatment plants - Sewer systems -Housing -Office buildings -Lifestyle centres

11. Real Estate Development & Management • Initiation and management of the creation, maintenance and eventual re-creation of spaces in which people live, work and play • Real estate development – starts with idea that comes to fruition when consumers, tenants or owner occupants occupy the bricks and mortar put in place by the development team

12. What is needed to transform a real estate idea into reality? • Land – availability for allocation to developers • Labour • Capital • Entrepreneurship • Effective management • Partnerships

13. The role of the public sector • Public sector always a partner in every deal • Real estate – a highly regulated process - property law - public infrastructure - financial market rules - zoning -building permits -endowment fees • All the above part of public sector realm

14. Real Estate Development Process • Inception of an idea • Refinement of an idea • Feasibility • Contract negotiation • Formal Commitment • Construction • Completion and formal opening • Property, asset and portfolio management

15. Commencement of construction • Infrastructure:- capacity of water and sewer treatment plants • Water and sewer reticulation - water and sewer mains • Onsite sewage and water reticulation • Roads • Certificate of Compliance – Sales through Cession • Enforcement of conditions in a development permit • Implications for the property industry

16. Completion and formal opening • Local authority approves occupancy • Connection of utilities – Where are they? • Sink boreholes, use generators for power, use private collectors of garbage- total building occupation costs become very expensive • Tenants move in – How do they move in when there is no water?

17. THE CASE OF KATIMA-MULILO, NAMIBIA • Katima Mulilo is the regional capital of the recently renamed Zambezi province in Namibia • Situated on the bank of the Zambezi River on the border with Zambia • Is the gateway into Central Southern Africa, occupying a unique position bordering Angola, Botswana, Zambia and Zimbabwe

18. POPULATION AND ECONOMIC ACTIVITY • Local population estimated at 28 200 during the 2011 Population and Housing Census • 60% of population lives in informal settlements which are currently being formalised • Economic activity mainly retail, industrial, Gvt/Parastatal, tourism and informal trading (dominated by food and alcohol trading) • Bulk of roads- gravel but well built

19. Municipal Status • KMTC elected for first time in 1992 • Town proclaimed in 1995 with an area of jurisdiction covering 2 969 ha • Second proclamation of 2008 added another 1 280 ha (though this is a GRN farm) • All operations governed by provisions of the Local Authorities Act, Chapter 23 of 1992 as amended

20. Planning legislation • Town Planning and layout design governed mainly by two pieces of legislation namely: • The Townships and Division of Land Ordinance No. 11 of 1963 – which deals with laws relating to the establishment of townships and controls the development and subdivision of land • The Town Planning Ordinance No. 18 of 1954 as amended, which makes provision for the preparation and carrying out of Town Planning Schemes and provides a framework within which such schemes are prepared

21. Planning Legislation cntd • For all Local Authorities which are not planning authorities, layout planning and township establishment is centrally approved by Ministry of Regional, Local Government, Housing and Rural Development (MRLGHRD) • Current setup is such that it takes anything up to three years to have any layout approved, surveyed and registered at the Deeds Office, thus creating a bottleneck in the land delivery process

22. Land Use Plan

23. Land alienation • All land sales or leases more than a year long have to be approved by MRLGHRD in terms of Sections 63(2) and 30(1)(t) of the Local Authorities Act, 23 of 1992 • This also creates bottlenecks in the land alienation system • Rate of land delivery far outweighed by demand

24. Impact of Rural Urban migration • Scenario aggravated by fact that Katima is the only proclaimed urban settlement in Zambezi Region, hence rural urban migration most pronounced here • Result is that more people live in informal settlements than in formal areas of the town

25. Opportunities in Khatima-Mlilo • Katima seen as sleeping giant just about to awaken • Strategic location on the gateway into Central Southern Africa • Demand for a dry land port for goods coming into and from the port of Walvis Bay • Demand for trucking facilities in town

26. Opportunities cntd • The Walvis Bay Corridor Group (WBCG) currently working on a Spatial Development Initiative (SDI) aimed at enhancing strategic linkages within a 100km radius of the Trans Zambezi Corridor, anchored in the town of Katima Mulilo • Katima also seen as providing an alternative, uncongested “waterfront” holiday resort besides Walvis Bay, Swakopmund etc

27. Opportunities Cntd • Existing and potential retail development have spheres of influence stretching across the border into Zambia • However the neighbouring countries also pose a serious competitive force in the tourism market • Katima currently a transit point to Kasane in Botswana and Victoria Falls in Zimbabwe

28. International Co-operation • Town stands to benefit from the Kavango-Zambezi Trans-Frontier Park (KAZA) jointly operated by Botswana, Namibia, Zambia and Zimbabwe • Tourism they key • Spatial development initiative – Victoria Falls, Livingstone, Kasane and Khatima Mlilo

29. Summary • Efficient land delivery system • Infrastructure – off-site and on-site • Partnerships – Public sector will always be a partner to the private sector • International Co-operation