Johannesburg Mayor Amos Masondo launched an Inner City Property Scheme (ICPS) on Wednesday, as component of a broader strategy to secure the city realises its goals of urban renewal and rejuvenation.
"The ICPS is an important initiative by the City of Johannesburg in partnership with the private sphere to address urban decline and speed the greening of the key business district," Masondo said at a media briefing.
The ICPS replaces the Johannesburg Better Buildings Programme, which focussed on turning "bad buildings" into "better buildings".
Masondo added that one of the concerns has been the way in which some of the residential buildings in the Johannesburg inner city had deteriorated over the years, showing signs and characteristics of urban decay.
In many instances, absentee owners have just abandoned the buildings without any further investing in the care and upkeep, he said.
"Sometimes buildings are only `taken over` and appropriated by organized groups and off into a havens for criminal activity, drug running and prostitution or worse."
In some cases, the city would expropriate the buildings.
The ICPS was developed to transfer expropriated properties into an interior city property portfolio in the work of passing these onto a new company.
Masondo said that broad-based black economic-empowerment (BBBEE) participants would give the controlling shares in the new company, of which the participating entities were selected through a request for proposal (RFP) process, and requisite to allow a minimum equity share of R5-million.
The new society will also raise debt capital from lenders and other providers of debt.
He hailed the ICPS as one of the most far-reaching BBBEE transactions yet introduced in South Africa.
The ICPS will also make a board of BBBEE service providers that will be responsible for restoration work. This will include among others: builders, carpenters, electricians, security companies, CCTV providers, landscapers and maintenance companies.
Participants in the system will be required, as far as possible, to get use of the services of businesses that are on the panel.
The city will be transferring 30 properties that are dilapidated, abandoned, illegally occupied or hijacked as good as vacant pieces of state into the new society through a developmental lease with an alternative to buy.
The city received 23 RFPs of which eight were chosen.
"We do not want short cuts. People must have as there is no way for incompetence and failure. This is not a money-making scheme for black people. We do not need this picture to be associated with the horror stories about BEE. We must just succeed," Masondo said.
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