Cape Town to release another inner city property for social housing
25 May 2023
The City of Cape Town is set to release its New Market Street property
for social housing development following City Council approval today, 25 May
2023. In an address to City Council, Cape Town Mayor
Geordin Hill-Lewis announced that the 10 300 square metre property will
yield 200 social housing units and over 300 gap and market units on the verge
of Cape Town’s CBD in Woodstock. The City is also adopting guidelines to
maximise social housing outputs on the properties it releases.
'New Market Street is close to all the amenities one could possibly hope for in central Cape Town. While the original feasibility study foresaw 165 social units in a mixed-use development, our more recent analysis is enabling us to maximise the social housing yield to 200 units. This will be cross-subsidised by retail space, and over 300 gap and market rental units. We have also rezoned the property to shorten development timeframes post the release.
'We pledged faster land release for more affordable housing, and in the year this priority project has been running, we have approved five inner city land parcels at varying land release stages, totalling over 1 300 social housing units, through this Council,' said Mayor Hill-Lewis.
Properties reaching critical land release milestones under the Mayoral Priority Programme for Affordable Housing Land Release include:
- Newmarket Street (Cape Town) – 200 social housing units
- Salt River Market (Salt River) – 215 social housing units
- Pickwick (Salt River) – 600 social housing units
- Fruit and Veg (CBD) – 180 social housing units
- Earl Street (Woodstock) – 160 social housing units
Mayor Hill-Lewis said the future of affordable housing is all about private sector delivery, with the state playing an enabling role through subsidies, bulk services, and discounted land for viable affordable housing development.
'Put simply, the City discounts land we release to enable social housing institutions and private developers to run viable projects. Projects generally need to be mixed-use to be viable, with some retail space and market residential units cross-subsidising the social housing units on the site,' said the Mayor.
Earlier in May, tenants started to move in to the City's well-located 204-unit Maitland Mews social housing development.
'It was a pleasure to have the National Minister of Human Settlements, most of the nine provincial housing MECs, and several of the MayCo members from other Metros there to see the project and welcome the first tenants.
'Sometimes one assumes that what we are doing here in Cape Town is the norm, and one only finds out by chance that it is in fact not being done elsewhere.
'For example, when we were welcoming residents to their Maitland Mews apartments, it came out in our discussions with our national colleagues that only we in Cape Town are offering rates discounts for social housing projects in perpetuity, to help keep rents down forever. Only Cape Town is offering free water to those social housing units. And now today we will also have clear and transparent guidelines for how we discount the land for those social housing projects,' said Mayor Hill-Lewis.
Land release guidelines to maximise social housing
The City Council agenda also included guidelines for the discounting of public land to help maximise the number of affordable housing units on the land it releases.
'In the past, many of the City's land release efforts have been stalled by a lack of clear, institutionalised guidelines for how to discount our land for social and affordable housing.
'With these path-breaking guidelines, we are enabling accelerated city land release for more affordable housing, in line with our pledge. The guidelines will provide market clarity on what factors the City will consider in discounting the land we release.
'Our clear purpose in releasing land for affordable housing is not to maximise the City's gain from the land sale. Rather, the purpose is squarely and explicitly to maximise the number of affordable units delivered.
'This will guide our decisions on land release and, importantly, do so legally and constitutionally,' said Mayor Hill-Lewis.
The City's Mayoral Committee Member for Economic Growth, Alderman James Vos, said factors the City would take into account in discounting land for social housing release include, inter alia, the market value of the erf, need for affordable housing in the area, how many units the project can yield, and overall project feasibility.
'We worked incredibly hard to get these guidelines drawn up, with an important goal in mind: to let the private sector get on with the business of affordable housing delivery. With these guidelines, property by property, project by project, we can deliver more affordable housing units close to economic opportunities,' said Alderman Vos.
End
Published by:
City of Cape Town, Media Office
