COMMERCIAL PROPERTY SECTOR

Transcription

1 Mpumaanga 2017 THE ROLE AND IMPACT of the COMMERCIAL PROPERTY SECTOR THE ECONOMIC VALUE of the COMMERCIAL PRIVATE PROPERTY SECTOR APPLICATION PROCESSING REPORT Siyabuswa KwaMhanga Emaaheni Lydenburg Sabie Hazyview White River Dustroom Nespruit Befast Emgwenya Barberton emanzana Caroina Sabi Park Skukuza Maroth Park Maeane Komatipoort Jeppes Reef Betha Evander Secunda Embaenhe Breyten Ermeo Amsterdam Standerton Daggakraa Piet Retief Voksrust Wakkerstroom

2 THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR Forward Roe and Vaue Anaysis Contents Mr. X.G.S Sithoe Chief Executive Officer MEGA s roe as a deveopment finance institution is to stimuate the growth and deveopment of the Mpumaanga economy by attracting and faciitating investment in the province. At its core, the strategy cas for MEGA to be a n investment-centric institution, faciitating high impact investments in the province through partnership. MEGA has been specificay mandated to stimuate growth in various sectors of the provincia economy and therefore provides opportunities to the residents of Mpumaanga through the funding of projects, promotion of Sma, Medium, and Micro Enterprises (SMME s), Cooperatives (Co-ops) and other businesses thereby contributing to the constitutiona imperative in Section 22 of the Constitution, which stipuates that citizens have a right to choose their trade, occupation or profession freey whie aso focusing on economic activity. Our Origins MEGA was formed in terms of the MEGA Act No. 1, of 2010, to provide funding to and promote foreign trade and investment in Mpumaanga, for the benefit of Historicay Disadvantaged Individuas (HDIs). The entity itsef was borne of a merger of three bodies: The Mpumaanga Economic Growth Agency (the former MEGA), responsibe for funding sma, medium and micro-enterprises and promoting trade and investment; the Mpumaanga Agricutura Deveopment Corporation, responsibe for financing and growing agricutura projects; and; the Mpumaanga Housing Finance Company, which financed housing. MEGA is now responsibe for funding SMMEs; agro projects and farming; and housing; and for promoting trade and investment in Mpumaanga. Further, the Agency invests in strategic projects that require an equity partner, ike Tekwane Citrus, Nkomati Anthracite, Loopspruit Wine Estate and Highved Fruit Packers a of which have benefited from MEGA s experience in commerciaising start-ups. Why MEGA? MEGA offers expertise on Mpumaanga s economy and investment potentia. MEGA s investment opportunities are packaged for a high probabiity of success. MEGA enjoys aiances and reationships with investors and other stakehoders. MEGA provides innovative soutions accompanied by a high eve of service. Our vision is to be a capabe, credibe and resiient institution that stimuates growth and deveopment in Mpumaanga, to reduce unempoyment, poverty and inequaity. Our primary mission is to foster the sustainabe growth and deveopment of Mpumaanga s economy by attracting, faciitating and maximizing investment. MEGA HEAD OFFICE ABSA Square Buiding, 20 Pau Kruger Street, Mbombea, 1200, Mpumaanga, South Africa Posta Address: PO Box 5838, Mbombea, 1200 t: f: e: info@mega.gov.za Section 1: Introduction Study Area Research Approach Report Outine 5 Section 2: Defining the Commercia Private Property Sector Property Components The Commercia Private Property Sector and its Reated Economic Sectors Reationship between the Private and Pubic Property Sectors 8 Section 3: Current Economic Vaue Economic Quantification: Approach Economic Quantification Projections Economic Performance and Main Representative Sectors Overa Economic Performance Sectora Composition in Context to Property Representative Sectors The Construction Sector The Business and Finance Sector Vaue in terms of GDP (Gross Domestic Product) Vaue in terms of Sustained Jobs Vaue in terms of Tax Revenue Generated 18 Section 4: Overview of the Economic Vaue of Commercia Private Property 19 List of Diagrams Diagram 1: Private Commercia Property Impacting Factors 5 Diagram 2: Report Outine 5 Diagram 3: Property Components of the Pubic and Private Sectors 7 Diagram 4: Reationship Scenarios between Private and Pubic Sectors 9 List of Figures Figure 1: Primary Economic Sectors 11 Figure 2: Cycica Economic Performance ( ) 12 Figure 3: Mpumaanga Province Sectora Contribution 13 Figure 4: Sectora Composition of the Reevant Economies, Figure 5: Composition of the Nationa Construction Sector, Figure 6: Composition of the Nationa Business and Finance Sector, Figure 7: Cycica Growth of the Construction Sector, Figure 8: Cycica Growth of the Business and Finance Sector, List of Tabes Tabe 1: Overa Projected Economic Vaue 12 Tabe 2: Construction Sector GDP Vaues, Tabe 3: Business and Finance Sector GDP Vaues, Tabe 4: GDP Output-Commercia Private Property Sector Tabe 5: Jobs sustained by the Private Property Sector 17 Tabe 6: Tax Revenue 18 2 Mpumaanga Province Mpumaanga Province

3 Appication Processing Anaysis Contents Section 1: Introduction Study Area Research Approach Purpose of this report Research Limitations Report Outine 24 Section 2: The Reguatory Environment Understanding the Spatia Panning and Land Use Management Act 16 of Nationa Legisative Framework Provincia Legisative Framework Municipa Legisative Framework 29 Section 3: Land Deveopment Appications Types of Deveopment Appications Buiding Pan Appications Land Use Management Appications Reguatory Entity Responsibiities Reguatory Transformations 34 Section 4: Deveopment Panning and Appication Administration Processes Land Use Management Appications SPLUMA appication processes Township Estabishment Scheme Amendment (Rezoning) Subdivision and Consoidation Buiding Pan Appications 40 List of Figures Figure 1: Mpumaanga Province: Buiding Pans Passed 42 Figure 2: CoM Commercia LUM Appications 44 Figure 3: CoM Buiding Pan Appications 45 Figure 4: Tota economic injection 53 List of Tabes Tabe 1: CoM Township Appication Process 38 Tabe 2: CoM Scheme Amendment/Rezoning Appication Process 39 Tabe 3: CoM Subdivision/Consoidation Appication Process 40 Tabe 4: Rezoning Appication Sampe 44 Tabe 5: Township Estabishment Appication Sampe 45 Tabe 6: Primary Appication Processing Deays 49 Tabe 7: Property deveopment variabe assumptions 53 Tabe 8: Comprehensive overview of economic impact 54 List of Maps Map 1: Mpumaanga Province 22 Map 2: The Goden Triange, Mbombea 30 Map 3: LED opportunities, CoM 31 Section 5: Appication Tracking Anaysis Land Use Management Appication Tracking Buiding Pan Appication Tracking Pubic Sector Inputs on Appication Deays 45 Section 6: Private Sector Perspectives Approach Key Limitations Private Sector Inputs on Appication Deays 47 Section 7: Recommendations 49 Appication Administration 49 Capacity Issues 50 Communication 50 Technica Issues 51 Section 8: Economic Impact of Appication Deays Approach Quantifying the Economic Impact of Property Deveopment The Financia Impact of Deays in Processing of Deveopment Appications 54 Section 9: Concusion 55 2 Mpumaanga Province Mpumaanga Province

4 THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR Section 1 Introduction In its commitment to activey advance the commercia property interests within the property industry, the South African Property Owners Association (SAPOA) commissioned the services of Urban-Econ to embark on an anaysis of the commercia private property industry in the Mpumaanga Province, with specific reference to the City of Mbombea Loca Municipaity. The anaysis of the commercia private property sector in the City of Mbombea forms part of a series of comparabe reports formery pubished by SAPOA. These incude anaysis of the roe and vaue of the commercia private property sector in the Western Cape (2010), Kwa-Zuu Nata (2015), and the Gauteng Province (2016). This report is the first component of the The Roe and Impact of the Commercia Property Sector in the Mpumaanga Province anaysis. The overa objective of the first component is to provide context in terms of the economic contribution and scope of the commercia private property sector in the Mpumaanga Province. The second component of the anaysis suppements the first through anaysing deveopment appication case studies as a means of inking processing timeframes to economic performance. The purpose of the first component of the study is to quantify the commercia private property industry in terms of its vaue for the provincia economy. This wi assist in deveoping a comprehensive understanding of the roe and vaue that the private property sector pays in the economic deveopment within the Province. n 1.2 Research Approach The purpose of this section is to define the methodoogy utiised to measure the economic vaue of the private commercia property sector within the City of Mbombea and the Mpumaanga Province. It is widey recognised that a economic activity typicay takes pace in a specific space or area, as such, a economic activities are reated to property either directy or indirecty. To measure the economic vaue of the private commercia property sector the reevant activities within the sector needs to be identified and evauated per specific anaysis factors. For this report, ony propertycentred economic activities with a direct impact on the oca, provincia and nationa economies are evauated in ine with generic economic impact practices. The directy impacting factors anaysed, as iustrated in Diagram 1, are Gross Domestic Product (GDP), direct empoyment and tax revenue by the private commercia property sector in the Mpumaanga Province. It is understood that The Roe and Impact of the Commercia Property sector in the Mpumaanga Province study wi be used to obtain vauabe information regarding the civic administration of property deveopment within the study area to quantify the distinct roe that the pubic and private sectors pay in property deveopment, particuary in terms of timeframes. Through quantifying the economic vaue of the sector and appying the findings to estimated appication processing timeframes, one can determine whether possibe processing deays by the pubic sector or private sector might have any impact on the provincia economy. It is important to note that the report does not represent an asset audit of the commercia private property industry. It presents a statistica evauation of the tota contribution that the private commercia property sector makes to the provincia economy in terms of the GDP, empoyment and tax revenue. GROSS DOMESTIC PRODUCT (GDP) DIRECT EMPLOYMENT A quantitative measure that incudes a pubic and private consumption, investments and net exports to measure the size of the nationa economy as we as representing the market vaue of a specific economic sector, such as the commercia property sector A persons that are empoyed on an annua basis within the commercia property sector City of Mbombea Loca Municipaity Gert Sibande District Municipaity Nkangaa District Municipaity Ehanzeni District Municipaity Siyabuswa KwaMhanga Emaaheni Betha Evander Secunda Embaenhe Standerton Lydenburg Dustroom Befast Emgwenya emanzana Caroina Breyten Ermeo Daggakraa Amsterdam Piet Retief Sabie Hazyview White River Nespruit Barberton Sabi Park Skukuza Maeane Jeppes Reef Komatipoort n 1.1 Study Area The Mpumaanga Province is famous for being one of the most beautifu and dynamic provinces in South Africa. The province is situated in the north-eastern parts of South Africa and borders the south of the Limpopo Province, east of the Gauteng Province and North of Kwa-Zuu Nata. In addition, the Mpumaanga Province borders neighbouring countries Swaziand and Mozambique east of the Province. The capita city of the Mpumaanga Province is Mbombea, formery known as Nespruit, ocated within the Mbombea Loca Municipaity. As of August 2016, the Mbombea Loca Municipaity is named the City of Mbombea due to the amagamation of the Mbombea Loca Municipaity and the Umjindi Loca Municipaity. TAX REVENUE (COMMERCIAL PROPERTY SECTOR) n 1.3 Report Outine This report defines the economic vaue of the commercia private property sector as per the various components of property construction and property management. In addition, it iustrates the vaue of commercia property construction and management based on job creation, economic production and tax revenue generated. The report outine is iustrated in Diagram 2. A coected revenues from taxed income and profits within the commercia property sector Diagram 1: Private Commercia Property Impacting Factors Defining the Commercia Private Property Sector Private property is defined as part of the property 2 components of a arger economy in order to identify the reevant economic sectors representing the private property sector Section Section Current Economic Vaue 3 This section incudes an anaysis that iustrates the existing vaue of the private property sector in terms of economic production and growth, job creation and tax revenue generated. Section Synopsis 4 Summary of the findings of the aforementioned anaysis presenting the vaue of the private property industry in Mpumaanga, with specific reference to the City of Mbombea Diagram 2: Report Outine Voksrust Wakkerstroom 4 Mpumaanga Province Mpumaanga Province

5 THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR Section 2 Defining the Commercia Private Property Sector In basic terms, commercia property is defined as property that is used for purposes of gaining monetary vaue. Before we can anayse the economic vaue of the commercia property sector it is vita that its roe is ceary defined within the arger economy. Typicay, commercia property incudes a variety of deveopment types such as retai, offices, industria, and arge scae residentia deveopments. The activities within the commercia property sector is grouped into either property construction activities or property management activities. These have been criticay anaysed to identify the primary and secondary sectors and in which markets these activities operate. When anaysing the components or activities of the commercia property market it shoud be noted that it is a market that is incessanty poignant and argey dependent on the interactions between the various stakehoders and roe-payers operating in the sector. As with any economy, the two main roe-payers are the pubic and private sectors. aong with supporting infrastructure such as ibraries, administration offices and other socia faciities. The pubic sector therefore empoys contractors and professionas from the private sector to undertake the construction of primary and supporting infrastructure. The pubic sector does not have any construction impementing bodies in the state, as such the private sector pays a dua roe in terms of property construction. Private contractors are responsibe for both privatey driven and pubic property construction activities. The responsibiities of the private sector in terms of property management mainy reates to activities such as saes and operation of privatey owned and. Diagram 3 cassifies a the components of property based on its reevance to the pubic and private sectors. COMMERCIAL PROPERTY SECTOR Diagram 3: Property Components of the Pubic and Private Sectors The successfu growth and deveopment of the commercia private property sector is highy dependent on the productive interaction and reationship between the private and pubic sectors. It is vita that both sectors aspire to estabish a good reationship that transates into outcomes based interactions that wi benefit both entities. The private sector comprises of organisations that are privatey owned. In property deveopment, the private sector is the primary impementing agent. Private deveopers acquire and and take on the construction and operation processes of commercia property deveopment. The primary objective of the private sector is to generate profit and reduce deveopment timeframes PRIVATE SECTOR CONSTRUCTION Construction of privatey owned, income generating property entities i.e. Asset Hoder Private contractors (for private and pubic sector) i.e. Buiders Professiona Services (for private and pubic sector) MANAGEMENT Operation i.e. Ceaners Saes i.e. Rea Estate agents Leasing i.e. Rea Estate agents i.e. Engineers The pubic sector performs an administrative and guiding roe in the commercia property market. Pubic sector entities take part in the deveopment appication processes through scrutinising appications and ensuring that the deveopment is in ine with the reguatory frameworks and poicy guideines of the municipa entity. PUBLIC SECTOR Financing of primary infrastructure i.e. Pubic Works Financing of supporting infrastructure i.e. Pubic Works Reguation i.e. Panning and Buiding Contro Administration i.e. Panning and Buiding Contro n 2:1 Property Components The commercia private property sector has a variety of components that form part of the arger economic profie of the Mpumaanga Province. The primary components of the commercia private property sector are construction and management. The subcomponents of construction incude the construction of privatey owned and income generating property entities, aong with the recruitment of private contractors and other professiona services required. In terms of property management, it is mainy the private sector s responsibiity to exchange private and by controing the saes and easing of property entities. In addition, the operation of property incuding maintenance, ceaning and security are aso the responsibiity of the private sector. These components are divided between the pubic and private sectors each with its own roe and responsibiities in terms of property deveopment and management. The pubic sector typicay pays the roe of the financier in property construction as we as the administrator in property management and deveopment appication processes. The construction responsibiities of the pubic sector mainy incudes the financing of primary roads and services, n 2.2 The Commercia Private Property Sector and its Reated Economic Sectors Commercia activities associated with the private property sector are reated to the appicabe economic sectors as per the Standard Industria Cassification (SIC) as utiised by Statistics South Africa. This is done to identify reevant sectors that make up the industry and utimatey contribute to its vaue. Most of the components within the commercia private property sector reate to the construction activities sub-sector, as defined by the SIC, comprising of major activities such as site preparation, buiding construction, buiding instaation, buiding competion and renting of buiding equipment. Hence, the economic construction sector presents the main indicator for performance and measurement of such activities. Nonetheess, the professiona services components incude architectura, engineering and other technica activities, which are categorised within the business and finance sector of the SIC. Commercia private property management pertains to a rea estate activities with owned or eased properties as we as per fee or contract basis. Rea estate activities aso form part of the business and finance sector as cassified within the SIC. 6 Mpumaanga Province Mpumaanga Province

6 THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR Construction of privatey owned, income generating property entities Private contractors Persona Services PRIVATE PROPERTY CONSTRUCTION Site preparation Buiding of compete constructions or parts thereof; civi engineering Buiding instaation Buiding competion Renting of construction or demoition equipment with operators Architectura, engineering and other technica activities PRIVATE PROPERTY MANAGEMENT Construction activities Other business activities CONSTRUCTION ACTIVITIES BUSINESS AND FINANCE SECTOR The first scenario pots the deveopment of a privatey owned mixed use deveopment in which private contractors and professionas are responsibe for the construction and preparation of speciaised appications to submit to oca authorities for approva, after which property management is totay within the competence of the private sector. The scenario highights the important reguatory and administrative roe that the pubic sector pays in private deveopment. The second scenario shows the deveopment of government administration offices in addition to supposed infrastructure upgrades to the surrounding roads. It emphasises the pubic sector s roe in terms of financia provision for construction with a construction activities as we as construction of major buk services that are outsourced to the private sector. The two scenarios assist with expaining the roe and vaue of the private sector in terms of the construction of pubic sector deveopments. In addition, it aso iustrates the importance of the pubic sector administration and reguation of private commercia property deveopments. To faciitate successfu and sustainabe property deveopment, it is imperative that both the pubic and private property sectors execute their roes and functions in a cooperative manner. Operation Saes Leasing Rea estate activities with owned or eased property Rea estate activities on a fee or contract basis Rea estate activities BUSINESS AND FINANCE SECTOR SCENARIO 1 Construction and operation of a mixed use deveopment comprising of residentia, commercia and retai components SCENARIO 2 Construc)on and opera)on of government administra)on offices with surrounding road infrastructure upgrades Diagram 4: Reationship Scenarios between Private and Pubic Sectors Property Components Major Activities (SIC) Sub and Main Economic Sectors (SIC) CONSTRUCTION RESPONSIBILITIES PUBLIC SECTOR PRIVATE SECTOR CONSTRUCTION RESPONSIBILITIES PUBLIC SECTOR PRIVATE SECTOR PUBLIC SECTOR DEVELOPMENT ADMINISTRATION POLICY AND STRATEGY FORMULATION PROPERTY DEVELOPMENT VISION n 2.3 Reationship between the Private and Pubic Property Sectors Naturay, the reationship between the pubic and private sector in the Mpumaanga Province has a significant roe and impact on property deveopment within the province. Aside from the fact that the pubic sector deas with the administrative processing of deveopment appications, its roe aso transcends into providing guidance to the private sector through the impementation of poicy and strategic panning initiatives. PRIVATE SECTOR PRO-DEVELOPMENT PROPERTY INVESTMENT DEVELOPMENT IMPLIMENTATION Therefore, the pubic sector s roe is to ensure that the deveopment goas and visions are transpired to the private sector as a means of ensuring cooperative property deveopment. Aternativey, the roe of the private sector in terms of property deveopment is primariy pro-deveopment and investment driven. The private sector identifies deveopment opportunities within the province and is utimatey responsibe for the impementation of property deveopment. Centra to the reationship is the submission and processing of deveopment appications otherwise known as and use management appications. Prior to any property deveopment, private deveopers must, by aw, obtain written permission from the municipa entity before deveopment can commence. As a means of iustrating the reationship between the two entities, Diagram 4, indicates two scenarios of private and pubic sector reationship. *NONE *Physica construction *Preparations of buiding pans and and use management appications for approva MANAGEMENT RESPONSIBILITIES PUBLIC SECTOR *Approva of buiding pans and and use management appications PRIVATE SECTOR *Saes and easing of residentia, commercia and retai space *Buiding maintenance/ceaning/ security *Financing of construction (outsourced to private sector by pubic works) *Physica construction *Preparations of buiding pans and and use management appications for approva MANAGEMENT RESPONSIBILITIES PUBLIC SECTOR *Approva of buiding pans and and use management appications PRIVATE SECTOR *Maintenance of deveopment What s happening in Mbombea? Makro Nespruit opened in 2011 in Mbombea s fastest growing area, Riverside. Riverside is ocated aong the R40 regiona road toward White River. Various ight industria, as we as commercia faciities have opened in the Riverside area. Riverside faciitates rapid economic growth within Mbombea as various retai, industria, warehousing, ight industria and commercia office deveopments have been deveoped in the past five years. These new deveopments are a near the existing Riverside deveopments such as the Riverside Shopping Centre and the Grove Shopping Centre. Various deveopments are sti panned within Riverside and Riverside Industria. There are currenty sti 30 to 35 hectares of deveopabe and avaiabe within Riverside Phase 2 and 140 hectares avaiabe within Riverside Phase 3, which is currenty being panned. 8 Mpumaanga Province Mpumaanga Province

7 THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR Section 3 Current Economic Vaue Ecconomic Indicator Projection Period Reason for Projections Assumption The foowing section intends to quantify the vaue of the commercia private property sector in the Mpumaanga Province, with specific reference to the City of Mbombea. The economic vaue refers to the contributions made towards GDP, empoyment and tax revenue by the commercia private property sector. Nationa GDP 2016 The nationa GDP is presented in an annua buetin reeased by Statistics South Africa; with the atest reease indicating the GDP up to To present the 2016 GDP a five-year average growth rate was derived and appied to the 2015 figure. Economic performance in 2016 is on par with the trends observed for the previous five years ( ) The vaue of the commercia private property sector is measured by anaysing the economic contribution made by the reevant economic sub-sectors and reating the findings to the tota GDP output of the focus areas. Additionay, captured findings incude information regarding the empoyment sustained and tax generated by the commercia private property sector. n 3.1 Economic Quantification: Approach The quantification approach iustrates the methodoogy used to determine the current economic vaue of the commercia private property sector in terms of construction and management of buidings. The quantification approach was adapted per the foowing data imitations: Avaiabiity of recent statistica reeases: The most recent pubished economic figures for the identified geographic eves are ony avaiabe up to Projections, based on historic statistica trends therefore had to be made to acquire 2016 figures. Avaiabiity of detaied economic statistics: Comprehensive composition breakdowns are ony avaiabe on nationa eve. A economic vaues provided are based on constant prices, with 2010 being the basic year. The methodoogy was deveoped based on a uniform distribution anaysis technique, which coates projections based on the 2015 economic performance with the composition of reevant nationa economic sectors to present up-to-date statistics for the Mpumaanga Province and the City of Mbombea. A five-year average annua growth rate was cacuated and utiised to acquire the estimated 2016 economic performance figures. The approach consists of the foowing components: Economic performance projections and cycica anaysis Identification of the main economic roepaying sectors in the commercia private property sector in the Mpumaanga Province Quantification of the economic vaue of the commercia private property sector as derived from the main roe-paying economic sectors. It is important to note that the most recent avaiabe statistics were utiised for projection purposes. Pubished data sources are presented uness otherwise indicated. n Economic Quantification Projections The economic contribution made by the private property sector is quantified by anaysing the composition of the various economic sectors namey construction, finance and business. Economic quantification of the commercia private property sector is given in terms of the vaue of the foowing indicators: GDP generated Jobs sustained Tax revenue generated As part of the anaysis of the vaue of the commercia private property sector, the foowing projections are appied to the GDP figures: Provincia GDP 2016 Loca GDP 2016 The provincia GDP is presented in an annua buetin reeased by Statistics South Africa, therefore the atest reease indicates the GDP up to To present the 2016 GDP a five-year average growth rate was derived and appied to the 2015 figure. The atest oca GDP figures are avaiabe up to 2015, as presented by Quantec Easydata s Standardised Regiona dataset, which is derived from empoyment and economic performance variabes as pubished by Statistics South Africa. To present the 2016 GDP a five-year average growth rate was derived and appied to the 2015 figures. The foowing projections are made for the empoyment and tax data gaps: Provincia economic performance in 2016 remained in ine with the performance achieved over the ast five years ( ) Loca economic performance in 2016 remained in ine with the performance achieved in the ast five years ( ) Ecconomic Indicator Projection Period Reason for Projections Assumption Nationa, Provincia and Loca Empoyment Vaue Nationa, Provincia and Loca Tax Revenue n 3.2 Economic Performance and Main Representative Sectors In cacuating the overa vaue of the commercia private property sector, severa direct and indirect infuences are considered. The overa economic performance in South Africa is measured by the growth and performance if its primary economic sectors. These incude, agricuture, forestry and fishing; mining and quarrying; manufacturing; Eectricity, Gas and Water; Construction; Whoesae, Retai and Trade; Empoyment vaue is presented in an annua buetin reeased by Statistics South Africa; with the atest reease indicating empoyment figures up to To present the 2016 empoyment vaue a five-year average growth rate was derived and appied to the 2015 figure. The atest annua tax revenue figures are avaiabe up to 2015, as presented by Quantec Easydata s Standardised Regiona dataset. To present the 2016 Tax Revenue generated a five-year average growth rate was derived and appied to the 2015 figures. Empoyment per industry figures in 2016 is on par with the trends observed for the previous five years ( ) Tax revenue generated in 2016 remained in ine with the performance achieved over the ast five years ( ) Agricuture, Forestry and Fishing Mining and Quarrying Manufacturing Eectricity, Gas and Water Construction Whoesae, retai and Trade Transport, storage and communication Finance, insurance, rea estate and business Community, socia and persona services Figure 1: Genera government Primary Economic Sectors 10 Mpumaanga Province Mpumaanga Province

8 THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR 4,0% 3,0% 2,0% 1,0% 0,0% -1,0% -2,0% ,3% -1,4% -1,3% Figure 2: Cycica Economic Performance ( ) Source: Quantec Easydata Standardised Regiona and Statistics South Africa Data 2016 Tabe 1: Overa Projected Economic Vaue Economy 2,5% 2,9% 3,5% 2,2% 2,4% 2,1% 2,1% 2,0% 2,1% 2,1% 1,7% 1,9% Mpumaanga Province City of Mbombea South Africa Transport, Storage and Communication; Finance, Insurance, Rea Estate and Business services; Community, Socia and Persona Services; and Genera Government. The primary economic sectors in South Africa are iustrated in Figure 1. n Overa Economic Performance The overa performance and growth of the primary economic sectors in South Africa serve as a potentia representation for the performance of the property industry. Figure 2 iustrates the combined economic performance of South Africa. Based on the cycica economic performances of the identified economies it is evident that that a of them have experienced reativey stabe growth patterns during the anaysis period with a sight dip between 2010 and Athough the nationa economy increased to 3.5% during 2010, it is evident that the Province as we as the oca municipaity s economic growth decined from 2.5% and 2.1% to 2.1% and 2.0%, respectivey. In terms of provincia economic growth, it is noticeabe that the provincia economic performance has remained beow the nationa average between , nevertheess an above average growth is evident in 2013 with an average of 3.1%. The provincia growth rate has decined since Economy 1,9% 3,1% 2,4% 2016 GDP (Rand Miions, Constant 2010 prices) 1,4% 1,4% 1,5% 1,5% 0,6% 0,6% 2014 from 3.1% to 0.6%. As the Mpumaanga provincia economy is dominated by the mining sector, the nationa mining strikes that occurred in 2014 have evidenty resuted in a severe economic impact on the province. Athough the provincia growth rate has decined since 2014, the City of Mbombea economic growth rate remained reativey stabe and on par with nationa trends. The average economic growth rate in the Mpumaanga Province is estimated at 2.08%, sighty higher than that of the City of Mbombea with an average growth rate of 1.9%. Both the provincia and oca annua economic growth rates are just beow the nationa average of 2.39%. Based on statistica projections, the Mpumaanga provincia economy contributes just over 7% to the nationa GDP, with a tota contribution of roughy R209 biion. The tota vaue of the City of Mbombea s economic contribution is projected at R 34 biion, and constitutes roughy 16.42% and 1.19% to the provincia and nationa economies respectivey. Figure 3 indicates the provincia sectora contribution of each of the economic sectors in the Mpumaanga Province. The primary contributing sectors in the Mpumaanga Province is the Mining and Quarrying sector which contributes a quarter (25%) to the provincia economy. Subsequenty, the Whoesae, Retai trade, catering and accommodation sector Share of Nationa Economy South Africa % Mpumaanga Province % City of Mbombea % contributes 15% to the provincia economy, foowed by the manufacturing sector with a 14% contribution. n Sectora Composition in Context to Property Representative Sectors Any economic activity must take pace in a specific area, thus a economic activities are reated to property either directy or indirecty. However, for this study ony property-centred economic activities with a more direct impact are evauated. Figure 4 compares the sectora contribution of South Africa, Mpumaanga Province, and the City of Mbombea Loca Municipaity. Focus shoud be paced on the contribution of the construction, and business finance sectors as these sectors encompass the property market activities. The nationa construction sector contributes approximatey 3.9% to the nationa economy, aong with the suppementary business and finance sector which contributes a portion of 22.2%. In terms of the provincia economy it is evident that the construction sector contributes to roughy 3% of the provincia economy, reativey on par with that of the nationa contribution. Aternativey, the business and finance sector within the province contributes to 13% of the provincia economy, significanty ower than the nationa average. 4,0% 3,0% 2,0% 1,0% 0,0% -1,0% -2,0% 2,5% Genera government 4% Community, socia and persona services 12% Finance, insurance, rea estate and business services 13% Transport, storage and communication 6% Whoesae and retai trade, catering and accommodation 15% Construction 3% Eectricity, gas and water 5% Manufacturing 14% Mining and quarrying 25% Agricuture, forestry and shing 3% 0% 5% 10% 15% 20% 25% 30% 2,1% 2,1% 2,0% 2,1% 2,1% 1,7% 1,9% Figure 3: Mpumaanga Province Sectora Contribution Source: Quantec Easydata Standardised Regiona and Statistics South Africa Data ,3% -1,4% -1,3% 2,9% 3,5% Furthermore, the construction, and business and finance sector within the City of Mbombea has a very simiar contribution as that of the nationa share with approximatey 3.84% in the construction sector and 21.88% in the business and finance sector. It shoud be noted that ony a portion of the business and finance sector forms part of the commercia private property sector, whereas the entire construction sector contributes to its performance directy. An in-depth anaysis of the main economic sub-sectors is required in order to acquire a better understanding of the economic vaue of the private property sector. As indicated, there are certain data imitations that necessitate the assumption that the composition of each of the main roe-paying economic sectors are uniform for the nationa, provincia, and oca economies, considering that simiar activities within the sectors reate to simiar contributing sub-sectors. This assumption is made since the data pertaining to the 2,2% Mpumaanga Province City of Mbombea South Africa 2,4% 1,9% 3,1% 2,4% Figure 4: Sectora Composition of the Reevant Economies, 2016 Source: Quantec Easydata Standardised Regiona and Statistics South Africa Data ,4% 1,4% 1,5% 1,5% 0,6% 0,6% 12 Mpumaanga Province Mpumaanga Province

9 THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR 42% 10% 29% 8% 6% 8% 2% Site preparation Figure 5: Composition of the Nationa Construction Sector, 2016 Source: Statistics South Africa Pubication: The Construction Industry, 2016 Figure 6: Composition of the Nationa Business and Finance Sector, 2010 Source: Statistics South Africa Pubication: Rea estate, activities auxiiary to financia intermediation and business services industry, ,8% Buiding of compete constructions or parts thereof Buiding of civi enginering structures 15% economic sectora composition is ony provided on a nationa eve. Figure 4 and Figure 5 iustrates the nationa composition of both the construction sector as we as the business and finance as provided in the most recent statistica pubications of South Africa. In terms of the composition of the nationa construction sector it is evident that the buiding of civi engineering services, as we as the buiding of compete constructions or parts thereof take up the argest portion of the construction sector with 42% and 29% respectivey, and totaing to 71%. The remaining activities incude buiding instaations (15%), buiding competion (8%), renting of construction or demoition 9,9% 8% Buiding instaation Buiding competion Renting of construction or demoition equipment with operators 16,7% equipment (5%), and asty site preparation (2%). As indicated, the rea estate activities make up 18.8% of the sector in the nationa market, foowed by ega bookkeeping and business management activities with 16.7%. n The Construction Sector Figure 7 indicates the comparative cycica performance of the construction sector in South Africa, the Mpumaanga Province, as we as the City of Mbombea Loca Municipaity. Economic growth within the construction sector has foowed a simiar growth path across a three economies. Evidenty, the construction sector in the Mpumaanga Province and City 8,9% 5% 38,6% 4% 2% 0% -2% CONSTRUCTION SECTOR ANNUAL GROWTH 1% % -1% South Africa Mpumaanga Province City of Mbombea SOUTH AFRICA 2.4% MPUMALANGA PROVINCE 2.4% CITY OF MBOMBELA 1.2% of Mbombea has experienced higher growth than the nationa average since The five-year average nationa growth rate in the construction sector is estimated at 2.4%, which equas the provincia growth rate of 2.4% per annum. The average construction growth rate in the City of Mbombea is estimated at 1.2% per annum. Tabe 2 represents the projected vaue of the construction sector for the reevant study areas in Projections indicate that the 3% 2% Mpumaanga provincia construction sector contributes approximatey 6.4% to the nationa construction sector s vaue of R 112 biion. In terms of the oca construction sector contribution, it is evident that the City of Mbombea has a contribution of 1.2% to the nationa construction sector and an 18.4% contribution to the provincia construction sector vaued at R1.3 biion. The construction sector contributions made by the Mpumaanga province suggest that the vaue of the oca construction sector performs a key roe in nationa economic growth as it takes up a sizeabe portion of the nationa construction sector. n The Business and Finance Sector Figure 8 iustrates the cycica growth performance of the reevant business and finance sectors. It is evident that the provincia business and finance sector has argey experienced higher growth patterns when compared to the nationa business and finance sector 3% 3% Figure 7: Cycica Growth of the Construction Sector, Source: Quantec Easydata Standardised Regiona and Statistics South Africa Data 2016 Rea estate activities 2,6% Renting of machinery/ equipment as we as persona and househod goods Computer and reated activities 2,2% Research and deveopment Lega, bookkeeping and business management activities Architectura, engineering and other technica activities 2,4% Advertising Other business activities Economy 2016 GDP (Rand Miions, Constant 2010 prices) Share of Nationa Construction Sector Share of Provincia Construction Sector South Africa % n/a Mpumaanga Province % 100% City of Mbombea % 18.4% Tabe 2: Construction Sector GDP Vaues,2016 Source: Quantec Easydata Standardised Regiona and Statistics South Africa Data Mpumaanga Province Mpumaanga Province

10 THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR 5% 5% Main Sector Sub-Sector Major Activities 2016 GDP Vaue (Rand Miions, constant 2010 prices) 4% 4% South Africa Mpumaanga Province City of Mbombea Loca Municipaity 4% 3% 3% 2% 2% 1% 1% 0% 1% 2% 3% 1% 1% 3% 3% CONSTRUCTION MANAGEMENT Construction Construction Activities Site preparation Construction Construction Construction Construction Business and Finance Business and Finance Construction Activities Buiding of compete constructions or parts thereof (excuding civi engineering) Construction Activities Buiding instaation Construction Activities Buiding competion Construction Activities Other business activities Rea estate activities Renting of construction or demoition equipment with operators Architectura, engineering and other technica services Rea estate activities with owned or eased properties and on a fee or contract basis Tota commercia private property construction South Africa Mpumaanga Province City of Mbombea Tota commercia private property management Tota commercia private property sector Figure 8: Cycica Growth of the Business and Finance Sector, Source: Quantec Easydata Standardised Regiona and Statistics South Africa Data 2016 BUSINESS AND FINANCE SECTOR ANNUAL GROWTH SOUTH AFRICA 2.8% MPUMALANGA PROVINCE 2.5% CITY OF MBOMBELA 2.3% Tabe 3: Business and Finance Sector GDP Vaues, 2016 Source: Quantec Easydata Standardised Regiona and Statistics South Africa Data 2016 growth rates. The City of Mbombea s business and finance sector significanty decreased between 2011 and 2013, however has experienced an upward improvement since then. Both the provincia and oca sectors have remained reativey on par with the recent nationa growth rate signifying reativey stabe economic growth. The five-year average growth rate of the business and finance sector in South Africa is estimated at 2.8%, which is sighty higher than the provincia growth rate of 2.5%. The average growth rate in the City of Mbombea s business and finance sector is cacuated at 2.3% per annum. Tabe 3 presents the projected vaue of the business and finance sector for the reevant study areas in Projections indicate that the Mpumaanga provincia business and finance sector contributes approximatey 4.1% to the nationa business and finance sector with a vaue of R26 biion. In terms of the oca construction sector contribution, it is evident that the City of Mbombea contributes 1.2% to the nationa business and finance sector, Economy 2016 GDP (Rand Miions, Constant 2010 prices) and approximatey 28.1% to the provincia business and finance sector. n 3.3 Vaue in terms of GDP (Gross Domestic Product) The vaue of the commercia private property sector, in terms of GDP output, is measured by appying the nationa GDP distribution to the Mpumaanga province as we as the City of Mbombea for It is assumed that the composition of the reevant sectors within the provincia and oca economies are in accordance with the nationa economy. Tabe 4 provides the resutant cacuated GDP output of the commercia private property sector. In 2016, the private property sector contributed approximatey R 237 biion to the Nationa GDP of creating a share contribution of 8.2%. On a provincia eve, it is evident that the private property sector contributed approximatey R 13 biion in Furthermore, the City of Mbombea contributed approximatey R2.8 biion Share of Nationa Business and Finance Sector Share of Provincia Business and Finance Sector South Africa % n/a Mpumaanga Province % 100% City of Mbombea % 28.1% Share of own tota economy 8.2% 6.2% 8.3% Share of tota nationa economy 8.2% 0.45% 0.10% n 3.4 Vaue in terms of Sustained Jobs The number of jobs sustained by the construction and management of commercia private property is derived from the nationa empoyment distribution per major activity, which is appied to the tota empoyment of the reevant regions. It is therefore assumed that the distribution of empoyment in the reevant sectors within the provincia and CONSTRUCTION MANAGEMENT Main Sector Sub-Sector Major Activities oca economies are in accordance with the composition of the nationa empoyment market. This is due to the fact that data pertaining to the detaied distribution of empoyment per major economic activity is ony avaiabe on a nationa eve. Tabe 5 presents the vaue in terms of jobs sustained by the private property sector within the nationa, provincia and oca economies. South Africa Tabe 4: GDP Output-Commercia Private Property Sector 2016 Source: Quantec Easydata Standardised Regiona and Statistics South Africa Data 2016 Tabe 5: Jobs sustained by the Private Property Sector Source: Quantec Easydata Standardised Regiona and Statistics South Africa Data Empoyment Mpumaanga Province City of Mbombea Loca Municipaity Construction Construction Activities Site preparation Construction Construction Construction Construction Business and Finance Business and Finance Construction Activities Buiding of compete constructions or parts thereof (excuding civi engineering) Construction Activities Buiding instaation Construction Activities Buiding competion Construction Activities Other business activities Rea estate activities Renting of construction or demoition equipment with operators Architectura, engineering and other technica services Rea estate activities with owned or eased properties and on a fee or contract basis Tota commercia private property construction Tota commercia private property management Tota commercia private property sector Share of own tota economy 9.39% 11.48% 11.19% Share of tota nationa economy 9.39% 0.8% 0.2% 16 Mpumaanga Province Mpumaanga Province

11 THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR Tabe 6: Tax Revenue Source: Quantec Easydata Standardised Regiona and Statistics South Africa Data 2016 CONSTRUCTION MANAGEMENT The commercia private property sector empoys roughy 1.5 miion peope in South Africa, accounting for 9.4% of a the jobs within the country. The Mpumaanga Province contributes approximatey 0.8% of the nationa abour force and 11.5% of its own economy. In the City of Mbombea approximatey peope are empoyed within the commercia private property sector contributing to 11.1% of its own economy. n 3.5 Vaue in terms of Tax Revenue Generated Tax revenue generated on production activities that are reated to the commercia private property sector indicates the contribution made to state revenue by this sector. Tax revenue is a function of income generated and is therefore estimated by cacuating the nationa proportion of production for each reevant activity and equating it to tota tax received by the construction, and business and finance sectors of the Mpumaanga Main Sector Sub-Sector Major Activities Province and the City of Mbombea in This cacuation is based on the assumption that the GDP composition of the reevant sectors within the provincia and oca economies are in accordance with the nationa economy, which in turn presents the eve of tax revenue generated by the SARS. Kindy note that the tax cacuations present tax income of SARS and not the oca municipa tax revenue. Tabe 6 indicates the tax revenue cacuations for the nationa, provincia and oca economies. The private property sector contributes approximatey 12% of tax revenue generated within the nationa economy (R 8.3 biion). In terms of the private property sector of the Mpumaanga Province, it is evident that the private property sector contributes to 9.5% (R 425 miion) of a tax revenue generated in the province. In addition, the private property sector in the City of Mbombea has a oca tax revenue contribution of 12.53% (R 11 miion) Tax Revenue (Rand Miions, constant 2010 prices) South Africa Mpumaanga Province City of Mbombea Loca Municipaity Construction Construction Activities Site preparation Construction Construction Construction Construction Business and Finance Business and Finance Construction Activities Buiding of compete constructions or parts thereof (excuding civi engineering) Construction Activities Buiding instaation Construction Activities Buiding competion Construction Activities Other business activities Rea estate activities Renting of construction or demoition equipment with operators Architectura, engineering and other technica services Rea estate activities with owned or eased properties and on a fee or contract basis Tota commercia private property construction Tota commercia private property management Tota commercia private property sector Share of own tota economy 12.00% 9.50% 12.53% Share of tota nationa economy 12.00% 0.61% 0.14% Overview of the Economic Vaue of Commercia Private Property Commercia private property is essentiay defined as and or buidings that beong to a private individua or company/group of individuas, rather than the government. In other words, the property owned by non-governmenta entities. Private commercia property for the purpose of this report, specificay incude retai, office, industria buidings as we as arge-scae residentia property deveopments and does not refer to individua private residences. The commercia private property construction performance is derived from the construction activities sub-sector comprising 57% of the construction main sector, with 8.9% of the business and finance sector aso represented in the form of speciaised services. The rea estate activities of commercia private property management highights the business and finance sector as its main economic roe-payer with 18.8% of the main sector comprising of commercia private property management reated services. The estimated vaue of the commercia private property sector is summarised as foows: Gross Domestic Product - The private property sector contributes approximatey R 237 biion to the nationa economy (8.2%), with construction contributing approximatey R 152 biion and property management R 84 biion. In terms of the Mpumaanga Province it is evident that approximatey 6.2% (R 14 biion) consists of private property sector activities of which R 9 biion is attributed to property construction and R 3.9 biion to property management activities. On the other hand, the private property sector in the City of Mbombea contributes approximatey 8.3% (R 2.8 biion) to the oca economy of which R1.8 biion is attributed to property construction and R 1 biion to property management activities. Jobs sustained Private property sustains roughy 1.5 miion jobs within the nationa economy of which 94% (1.4 miion jobs) is within the property construction sub-sector and the remaining 6% ( jobs) in the property management sub-sector. The jobs sustained within the private property sector takes up approximatey 9.4% of the nationa empoyment eve. On a provincia eve it is evident that the private property sector in the Mpumaanga Province empoys roughy peope of which 96% ( jobs) is attributed to property construction and 4% (5001 jobs) to property management activities. The City of Mbombea has roughy peope empoyed in the private property sector of which 95% ( jobs) is within property construction and 5% (1 216 jobs) is occupied in the property management sub-sector. Tax generated The Nationa private property sector generated R8.3 biion for the tax fiscus during 2016, of which 41% (R3.4 biion) was generated from property construction and 59% (R4.9 biion) from property management activities. In terms of the provincia tax generated it is evident that the private property sector has contributed roughy R425 miion of which 44% (R185 miion) was from property construction and 56% (R 240 miion) from property management activities. Furthermore, the tax generated in the City of Mbombea in 2016 was R 101 miion with 40.5% (R 41 miion) from property construction and 59.5% (R 60 miion) from property management. Section 4 18 Mpumaanga Province Mpumaanga Province

12 THE ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR What s happening in Mbombea? Severa prominent commercia deveopments are panned in the Riverside area of Mbombea. The Riverside Park - Ext 24 project is a 74-ha mixed-use deveopment, incuding retai, whoesae, accommodation, motor deaer, business, and office functions. Incuded in the confirmed anchor tenants incude severa arge retaiers and motor deaers. The township appication of this project has been approved and wi form part of the arger Riverside Precinct in Mbombea. An additiona commercia investment is the Riverside Commercia Park - Ext 12, a 12-ha deveopment marketed as visibe and accessibe to transient consumers. Zonings associated with this deveopment incude motor deaers, manufacturing, and retai. Aso, incuded in the Riverside Precinct is the Riverside Office Park, which offers m2 office space with sectiona tite ownership, centray ocated in Riverside, with state-of-the art design aspects, with good access to retai and restaurant faciities in the Riverside Ma. Mpumaanga 2017 ECONOMIC VALUE OF THE COMMERCIAL PRIVATE PROPERTY SECTOR THE ROLE AND IMPACT of the COMMERCIAL PROPERTY SECTOR APPLICATION PROCESSING REPORT Siyabuswa KwaMhanga Emaaheni Lydenburg Sabie Hazyview White River Dustroom Nespruit Befast Emgwenya Barberton emanzana Caroina Sabi Park Skukuza Maroth Park Maeane Komatipoort Jeppes Reef Betha Evander Secunda Embaenhe Breyten Ermeo Amsterdam Standerton Daggakraa Piet Retief 20 Mpumaanga Province Voksrust Wakkerstroom Mpumaanga Province

13 Siyabuswa KwaMhanga Emaaheni Betha Evander Secunda Embaenhe Standerton Section 1 Map 1: Mpumaanga Province City of Mbombea Loca Municipaity Gert Sibande District Municipaity Nkangaa District Municipaity Ehanzeni District Municipaity Voksrust Dustroom Befast Breyten Caroina Ermeo Daggakraa Wakkerstroom Introduction The purpose of this report is to investigate the second component of the The Roe and Impact of the Commercia Private Property Sector in the Mpumaanga Province study. The first component contextuaises the size and quantity of the private property sector in the Mpumaanga Province to provide a foundation for the importance of the industry and specificay the vaue that it hods within the arger economy. Essentiay the purpose of this section of the report is to suppement the first component of the study by anaysing the deveopment appication processes of the City of Mbombea Loca Municipaity (CoM). Moreover, this report intends to provide a perspective on existing administrative processes, highighting certain areas of concern and possibe improvements where required. The anaysis of the commercia private property sector in the City of Mbombea forms part of a series of comparabe reports formery pubished by SAPOA. These incude the anaysis of the roe and vaue of the commercia private property sector in the Western Cape (2010), Kwa-Zuu Nata (2015), and the Gauteng Province (2016). n 1.1 Study Area The Mpumaanga Province is famous for being one of the most beautifu and dynamic provinces in South Africa. The province is situated in the North-eastern parts of South Africa and borders the south of the Limpopo Province, east of the Gauteng Province and North of Kwa- Zuu Nata. In addition, the Mpumaanga Province borders neighbouring countries Lydenburg Emgwenya emanzana Amsterdam Piet Retief Sabie Hazyview Sabi Park Skukuza White River Maeane Nespruit Komatipoort Jeppes Reef Barberton Swaziand and Mozambique east of the Province. The capita city of the Mpumaanga Province is Mbombea, formery known as Nespruit, ocated within the Mbombea Loca Municipaity. As of August 2016, the Mbombea Loca Municipaity is named the City of Mbombea due to the amagamation of the Mbombea Loca Municipaity and the Umjindi Loca Municipaity. n 1.2 Research Approach The genera research approach intends to carify the methodoogy and approach utiised to measure the performance of the appication administration processes within the reevant departments of the CoM. The private commercia property sector comprises of various construction and property management activities as identified in Section 2 of the first component of this study. As indicated, the commercia private property sector consists of construction activities aong with property management activities. Various administrative processes are invoved within the vaue chain of each of these activities. For this study, it is impractica to measure administration efficiency within the entire deveopment cyce. Therefore, this report identifies the administration of deveopment appications incuding buiding pans and Land Use Management (LUM) appications as the centra component of the deveopment ifecyce from an administrative point of view. Administration of the reevant deveopment appications are deat with in this report taking into consideration that this is a municipa function. Appication processing proficiency is measured by utiising appication tracking case studies provided by the private and pubic sector respectivey, in addition an overa assessment of the municipa deveopment appication database. However, to provide context, it is important to firsty provide carity on the reguatory environment in which the appication processes function, aong with the genera timeframes prescribed for administration. After forming an understanding of the reguations and processes invoved in buiding pan and LUM appication administration, the appication tracking anaysis is initiated by identifying a sampe of appications provided by the private and pubic sector thereafter identifying any deaying factors experienced by the private sector respondents on the one side as we as the municipa respondents on the other. As per the Spatia Panning and Land Use Management Act 16 of 2013 (SPLUMA) 1, effective from 1 Juy 2015, a oca municipaities are now responsibe for the contro and reguation of the use of and within their respective municipa areas. As such, a buiding pan and LUM appications are deat with primariy at municipa eve. Departments and government entities consuted during the research process Statistics South Africa City of Mbombea Loca Municipaity Mpumaanga Province n 1.3 Purpose of this report Utimatey the purpose of this report is to utiise existing appication tracking scenarios as toos to measure the turnaround times of the deveopment appications in terms of timeframes prescribed by the reevant reguatory entity. It shoud be noted that this report does not represent an audit of a deveopment appications administered by the CoM but rather, an evauation of appication tracking case studies provided by both the pubic and private sectors. This report was compied after a time of fundamenta change in deveopment panning egisation. Therefore, not ony does this report seek to identify factors infuencing the deveopment appication processes and timeframes, but it aso intends to recognise the reevance of the transformed egisation. Furthermore, it is understood that the The Roe and Impact of the Commercia Private Property Sector in the Mpumaanga Province study wi be utiised to obtain vauabe information regarding the civic administration of property deveopment within the identified study area to quantify the distinct roes that the pubic and private sector pay in property deveopment, particuary in terms of timeframes. Through quantifying the economic vaue of the commercia private property sector and determining the estimated appication timeframes, the study provides insight on the eve of impact that the deveopment appication administration tempo has on the provincia and oca economy. n 1.4 Research Limitations Due to the quaitative and quantitative research methodoogy, certain imitations were noted during the research process. It is important that the imitations are stated and recognised in the report to ensure that there is a contextua understanding of the resuts. The basic imitations to the research are: Primary data sources were argey reiant on verba communications by various government officias and private property professionas. For the sake of objectivity, a detrimenta remarks have been excuded in the research. The captured information provides a mutisided perspective based on the highest possibe representation of the private and pubic sector respondents. It shoud be noted that the response received from the appication tracking questionnaires that were distributed to the private sector was insufficient, however a significant number of interviews were competed as a means of obtaining the required information. A the imitations are addressed through the provision of a wide variety of case studies. The imitations are therefore, mitigated as far as possibe to ensure that the report contains accurate resuts. 1 The SPLUMA came into operation on the 1st of Juy 2015, resuting in a number of LUM changes in the appication process. 22 Mpumaanga Province Mpumaanga Province

14 n 1.5 Report Outine The report firsty investigates the poicy and egisative environment in which deveopment processes operate and secondy identifies the various appication administration processes with regard to property deveopment appications. Furthermore, it determines the appication administration efficiency and provides a number of recommendations and guideines in terms of improving the existing administrative functions of the CoM. The foowing sections are incuded in this report: The Reguatory Environment To be abe to recognise and anayse the tempo and proficiency of the appication administration processes within the CoM, it is important to obtain an understanding of the egisative environment that infuences the appication processes. This section of the report therefore provides a perspective on the reevant nationa, provincia, and oca egisation and poicies in order to gain context and background, aong with forming a basis from which appication processes can be examined. Section 2 Section 2 Section 3 Reguatory Environment The reguatory and egisative environment in which appication processing functions is outined. Land Deveopment Appications and Reguatory Entity Responsibiities This section incudes an anaysis of the types of deveopment appications and the reguatory responsibiities of the municipaity in terms of appication processing. Section 6 Section 7 Private Sector Perspectives The purpose of this section is to outine the municipa performance based on the experiences of the private sector in terms of LUM and buiding pan appication submissions. Recommendations This section summarises the key probems and chaenges identi ed in the anaysis and utimatey provides recommendations based on the issues identi ed in the preceding sections. The ega framework under which municipa spatia panning functions in South Africa has, since the 1994 eections, changed significanty. Prior to 1994, panning was essentiay reguated according to the division of and through impementing racia segregation known as apartheid. As such, South Africa had distinct panning egisations for the then four Provinces as we as for the former back homeands. Athough much of the Apartheid panning egisation remained unchanged subsequent to the 1994 democratic eections, new egisation was adopted as a means of reversing or mitigating the spatia injustices of the Apartheid panning administration. One of which was the Deveopment Faciitation Act No 67 of 1995 (DFA). Section 4 Section 5 Deveopment Panning Appication Process This section provides a summary of the deveopment panning appication processes in terms of each phase of the appication and the reevant timeframes. Appication Tracking Anaysis An overview of the number of appications processed as we as the e ciency rate. Appications are reviewed and assessed in order to determine the pressing chaenges and shortcomings. Section 8 Section 9 The Economic Impact of Appication Deays A variabes are processed into the economic impact assessment mode in order to determine the potentia nancia osses associated with appication deays. An overview of some Concusion and Fina Remarks na deductions and remarks based on the anaysis conducted. The DFA was empoyed as an interim measure to dea with the spatia issues as a resut of the apartheid egacy. It shoud be noted that the DFA was, at the time, the ony egisation that specificay deat with spatia deveopment principes and and use management. During 2010, the DFA chapters that deat with LUM were deemed unconstitutiona and were subsequenty repeaed aong with a number of other panning reated egisation that operated parae with the DFA. As a means of providing a singe egisative, integrated panning system for the entire country the department of Rura Deveopment and Land Reform (DRDLR) introduced the Spatia Panning and Land Use Management Act No 16 of 2013 (SPLUMA). Essentiay, SPLUMA was introduced as a egisative instrument to repace the DFA in terms of reguating spatia panning and and use management in South Africa. The ega basis for the origin of SPLUMA was prompted by the constitutiona court 2 in which it found that, unike the reguations stipuated in the DFA, municipa panning is the excusive function of a municipa government in terms of LUM. SPLUMA was impemented on the 1st of Juy 2015 aong with additiona egisation intended to utimatey provide a patform for sustainabe and resiient deveopment panning in South Africa. n 2.1 Understanding the Spatia Panning and Land Use Management Act 16 of 2013 The purpose of the Spatia Panning and Land Use Management Act No 16 of 2013 is to essentiay provide for a uniformed spatia panning system in South Africa that aow municipaities to have the majority of contro in and use management and deveopment processes. The enactment of SPLUMA has a significant roe in terms of the socioeconomic context of South Africa. Apart from the provision of comprehensive and sustainabe panning systems, the purpose outined in SPLUMA is motivated by a strong need for socia and economic incusion. As 2 Constitutiona court of South Africa: City of Johannesburg Metropoitan Municipaity v Gauteng Deveopment Tribuna and Others CCT89/09 18 June 2010 What s happening in Mbombea? The construction of the Mpumaanga High Court in Mbombea started in 2013 and is schedued for competion in The five-story court buiding, which has five crimina courtrooms and six for civi cases, is deveoped at an estimated cost of R800 miion. The addition of the new High Court deveopment within Mbombea faciitates an injection for oca economic growth and empoyment opportunities as the High Court serves the entire Mpumaanga Province. 24 Mpumaanga Province Mpumaanga Province

15 SPLUMA Purpose of the act > To provide a framework for spa0a panning and and use management in South Africa that provides for incusive, deveopmenta, equitabe and efficient spa0a panning at the different spheres of government. OBJECTIVES of the Act: ü Provide for a uniform, effec1ve and comprehensive system. ü Ensures that spa1a panning promotes socia and economic incusion. ü Provide for deveopment principes, norms and standards. ü Provide for sustainabe and efficient use of and. ü Provide for coopera1ve government and intergovernmenta rea1ons. ü To redress the imbaances of the past and to ensure that there is equity. GOOD ADMINISTRATION SPATIAL SUSTAINABILITY SPATIAL RESILIENCE SPATIAL PLANNING AND LAND USE MANAGEMENT ACT NO 16 OF 2013 Sec1on 2(2) : No other egisa1on may prescribe an aterna1ve or parae mechanism, measure, ins1tu1on or system on spa1a panning, and use, and use management and and deveopment in any way inconsistent with the Act. This makes SPLUMA the most reevant and important piece of egisa<on in spa<a panning. CATEGORIES OF SPATIAL PLANNING Municipa Provincia Nationa Support and Monitor other spheres and priori<se na<ona interests. Contro and reguate the use of and through IDP s, Land use Scheme s and SDF s. Monitor compiance by municipai<es with SPLUMA Compie, approve and review Provincia SDF and other poicies. Making and review of na<ona poicies designed to monitor other spheres Compie, approve and review Na<ona SDF. Support and Monitor provincia and municipa ac<vi<es and priori<se provincia interests. Municipa differen<a<on each municipaity is unique. ALIGNMENT OF AUTHORISATION PROCESSES on poicies and egisa0on impac0ng on and deveopment appica0ons and decision making processes. MUNICIPALITIES AS AUTHORITIES OF FIRST INSTANCE. Reitera0on of the soe mandate of municipai0es where municipa panning is concerned. ESTABLISHMENT OF MUNICIPAL PLANNING TRIBUNALS AND APPEALS STRUCTURES by municipai0es to process and deveopment appica0ons. PREPARATION OF RESPECTIVE SDF S by a three spheres of government, based on norms and standards guided by deveopment principes. DEVELOPMENT OF A LAND USE SCHEME Singe and incusive for the en0re municipaity with emphasis on municipa differen0a0on. STRENGTHENED INTERGOVERNMENTAL SUPPORT through enforcement, compiance and monitoring processes. NEW DEVELOPMENT APPLICATIONS made in terms of SPLUMA and municipa by-aws. Legisation repeaed by SPLUMA Remova of Restric<ons Act 84 of 1967 Physica Panning Act 88 of 1967 Less Forma Township Estabishment Act 113 of 1991 Physica Panning Act 125 of 1991 Deveopment Faciita<on Act No 67 of 1995 a) Who can appea? Any person whose rights are affected by the municipa tribuna decision b) What can be appeaed? Appea against (i) En<re decision, (ii) Condi<ons, (iii) Appea based on process review appica<on, and (iv) faiure to make a decision c) How does one go about a_aining intervener status? Submit a pe<<on to the MPT with an affidavit proving that no cousions are evident. d) When granted intervener status, pe<<on to intervene is odged. When is intervener status granted to objector? When an appica<on is submi_ed an interested person can at any point in <me, but shoud appy within 7 days of becoming aware of proceedings, be granted intervener status by the tribuna or authorized officia. e) Theore<cay, how ong does the appea process take? Appeas are to be odged within 21 days of decision. Pre-hearing process shoud be competed within 150 days of no<ce to appea. Appea is submi_ed within 14days ader compe<on of pre-hearing process. FREQUENLTY ASKED QUESTIONS 1. What happens to pending od order Ordinance appica1ons now that SPLUMA has been enacted as of 1 Juy 2015? Depending on which phase the appica<on is in, the municipaity can either process the appica<on in terms of the od egisa<on and transi<ona measures, or request that a new appica<on be odged. 2. What happens to the former Deveopment Faciita1on Act appica1ons that have not been finaised by the province? The Gauteng Province is categorising a DFA appica<ons into their respec<ve municipaity and these wi then be handed over to the municipaity to process. 3. Can the municipaity accept deveopment appica1ons in terms of the od Ordinances subsequent to the 1st of Juy 2015? The od ordinance remains in opera<on un< the municipa by-aws have been adopted. However, deveopment appica<ons sha be odged in terms of the od Ordinance AND in accordance with SPLUMA. Created by : Urban-Econ Deveopment Economists a resut, many of the poverty stricken and previousy excuded areas shoud have the opportunity to improve socio-economic conditions and utimatey contribute towards the nationa economy. In addition, the enforcement of the sustainabe and efficient use of and through cooperative governance utimatey resuts in enhanced opportunities and potentia for increased economic investment. The purpose of SPLUMA outines the intentions of nationa, provincia and oca government to provide a socio-economic environment that is refective of a democratic society. n 2.2 Nationa Legisative Framework The egisative framework under which deveopment panning on a nationa scae functions is based on the foowing: Constitution of RSA No 108 of 1996 > In terms of municipa panning the roe of the Constitution of RSA is that of assigning municipa panning responsibiities to municipaities in terms of Section 156 of the Constitution of RSA read with Part B of Schedue 4, in terms of which municipaities have both executive authority and a right to administer to the extent set out in Section Municipa panning is therefore the constitutiona responsibiity of oca and metropoitan municipaities. Municipa Systems Act No 32 of 2000 > Requires that oca government prepare Integrated Deveopment Pans (IDP s). The IDP is a comprehensive pan that shoud refect, among other, the ong term municipa deveopment vision within its area of jurisdiction, identify areas of highest need for basic municipa services, as we as the municipa deveopment strategies accompanied by a detaied financia pan. In addition, it is required that a IDP s incude a Spatia Deveopment Framework (SDF) which incudes the basic guideines for a and use system within the municipaity. Deveopment Faciitation Act no 16 of 1995 > Prior to its repea, the DFA intended to faciitate and speed up the impementation of the reconstruction and deveopment programmes and projects in reation to and, aong with providing genera principes governing and deveopment throughout South Africa. After the DFA was repeaed, a appications in were submitted in terms of the Town Panning and Townships Ordinance No 15 of 1986 unti the municipa by-aws (as stipuated by SPLUMA) are in pace. Spatia Panning and Land Use Management Act 16 of 2013 > The mandate for nationa government as stipuated by SPLUMA indicates that nationa government shoud provide support and assistance to municipaities as we as monitor the compiance of municipaities and provinces to SPLUMA. In addition, SPLUMA stipuates that a nationa SDF shoud be deveoped in order to guide deveopment in a of the provinces. Nationa Buiding Reguations and Buiding Standards Act No 103 of 1977 > Essentiay impemented for the purpose of buiding contro, prescribing buiding standards and other reated matters. A proposed buiding pans are submitted in ine with this Act. Additiona Acts that have reevance to deveopment panning > South African Nationa Road Agency Limited and Nationa Roads Act No 7 of 1998 Restitution of Land Rights Act No 22 of 1994 Restitution of Land Rights Amendment Act 48 of 2003 Restitution of Land Rights Amendment Act 15 of Housing Act No 107 of 1997 Land Survey Act No 8 of 1997 Loca Government Municipa Property Rates Act No 6 of 2004 Subdivision of Agricutura Land Act No 70 of 1970 Nationa Economic Poicies > The Nationa Deveopment Pan (NDP) 2030 highights, among other, the need for the improvement of oca township economies and empoyment creation, 3 SALGA-South African Loca Government Association Mpumaanga Province Mpumaanga Province

16 investing in infrastructure and environmenta sustainabiity, panning for an incusive rura economy, and buiding a capabe and deveopmenta state. A summary of the directives announced in the NDP incudes, among others, the reversing of urban spraw; sustainabe human settements; new urban deveopment around transport and economic nodes; creating township economic hubs; integrating townships into the wider economy; informa settement upgrades; quaity design of pubic space; and redirecting state-funding from nonstrategic investments towards more vauabe investments. with Schoos w growth path: ACCORD 3 LoCaL procurement accord THE NEW GROWTH PATH: FRAMEWORK higher education higher education & training & training Department: Department: Higher Education and Training Higher Education and Training REPUBLIC OF SOUTH AFRICA REPUBLIC OF SOUTH AFRICA 2011/11/19 4:18 PM The New Growth Path (NGP) 2011 advocates the creation of jobs argey in the private sector and highights the need to address unempoyment, poverty and inequaity. Furthermore, the NGP sets a target of creating five miion jobs by This target is projected to reduce unempoyment from 25% to 15%. ENVIRONMENTAL RELATED LEGISLATION On a nationa eve there are aso a number of environmenta reated poicies and egisations that infuence LUM and buiding pan appications, which are isted as foows: Nationa Environmenta Management Act (NEMA) 107 of 1998 and associated Acts > athough primariy reated to environmenta matters, NEMA aso contains certain principes reating directy to panning where the environment may be affected. The Act requires sustainabe deveopment, i.e. where there is an integration of socia, economic and environmenta factors in the panning, impementation and evauation of decisions, so as to ensure that deveopment serves both present and future generations. The Act provides for the estabishment of reguations and isting activities that require a suitabe eve of environmenta assessment. Furthermore, it indicates the extent of such an assessment and ensures that an integrated environmenta management approach is foowed. 28 Mpumaanga Province Other specific environmenta management Acts that were promugated to dea with specific methods of environmenta management are isted beow: NEMA: Protected Areas Act No 57 of NEMA: Biodiversity Act No 10 of NEMA: Air Quaity Act No 39 of NEMA: Integrated Coasta Management Act No 24 of NEMA: Waste Act No 59 of n 2.3 Provincia Legisative Framework The mandate of the Mpumaanga provincia government ies first and foremost in the Constitution of RSA in which it states that the Premier performs executive, poicy, egisative, intergovernmenta and ceremonia functions in the province. Furthermore, the provincia government must be capacitated and positioned to effectivey provide eadership, oversee functiona administration processes, and provide ong term panning and poicy coordination. The egisative framework under which deveopment panning on a provincia scae operates is based on the foowing: Spatia Panning and Land Use Management Act 16 of 2013 > the mandate for provincia government is to essentiay provide support to municipaities as we as assist in any and deveopment disputes. Furthermore, SPLUMA stipuates that provincia government shoud strengthen the capacity of municipaities to impement an effective system of LUM. SPLUMA came into effect on the 1st Juy Importanty, SPLUMA does not have the ega right to repea any provincia panning egisation or nationa panning egisation that was assigned to the provincia sphere. Any provisions in provincia egisation that are inconsistent with SPLUMA wi however be of no effect. Mpumaanga Town Panning and Land Reated Laws Repea Bi 2016 > In response to SPLUMA, the provincia government introduced the Town Panning and Land Reated Laws Repea Bi to manage the transition from the former panning dispensation to the new panning dispensation namey SPLUMA. Among other, the Bi seeks to repea the foowing acts: Transvaa Town Panning and Townships Ordinance, No 15 of 1986; Division of Land Ordinance, No 20 of 1986 Remova of Restrictions Act, No 84 of 1967 Physica Panning Act, No 88 of 1967 Reguations Reating to Township Estabishment and Land Use Government, 1986 Less Forma Township Estabishment Act, No 113 of 1991 Mpumaanga Panning Bi 2013 > The Bi provides for the panning and impementation of a uniformed and deveopment and and use management system. The intention of the Bi is to guide deveopment through the provincia and municipa spatia deveopment frameworks as we as the procedures, processes and formats of and appications. Importanty, the Bi provides for the support to municipaities and to promote the integration of provincia poicies and frameworks with nationa and municipa pans. The Bi guides the process to be foowed in the appication for deveopment and ceary states that the onus ies soey with the municipaity in terms of the approva or rejection of a appications. Provincia Spatia and Economic Poicies > The Mpumaanga Economic Growth and Deveopment Path 2011 aims towards a more equitabe and incusive economy. The poicy emphasises the economic chaenges experienced by the province incuding the decine in mining jobs, manufacturing jobs, and empoyment growth in the tertiary sectors. Furthermore, it intends to improve and strengthen the provincia economy by providing bod and effective strategies to achieve an equitabe economy. The poicy defines a set of principes for unocking economic and empoyment growth. These incude Broad Based Back Economic Empowerment, strategic procurement that benefits SMME s, and abour and skis deveopment. In addition, the province wi form incusive and shared economic growth by focussing on cost reductions in business. The province, aong with the municipaities, wi acquire strategic and and rezone it as a too to foster economic deveopment. The Mpumaanga Dept. of Economic Deveopment and Tourism Strategic Pan provides a framework to consoidate efforts on provincia priorities in a matters affecting the provincia economy. The overarching vision of the pan is to drive economic growth that creates decent empoyment and promote sustainabe deveopment through partnership. The strategic pan highights, among other, the importance of job creation and seizing potentia for new economies. Importanty, the pan highights the need to form strong partnerships with the private sector. The Mpumaanga Vision 2030 expresses the key priorities, objectives and targets of the province. The overa objectives of the vision is to faciitate decision making and prioritisation to foster informed decisions and trade-offs. The key outcome of the vision is to promote empoyment and economic growth within the province. The target set forth by the Mpumaanga Province incudes reaching a tota of 1.2 miion additiona jobs with an unempoyment rate of 6% and an average GDP growth above 5%. n 2.4 Municipa Legisative Framework Prior to the promugation of SPLUMA, the egisative framework in which deveopment panning operated was based on the former town panning schemes as stipuated by pre-spluma egisation as we as the Town Panning and Townships Ordinance No 15 of Essentiay, the Town Panning and Townships Ordinance intended to contro panning in the province. The Ordinance stipuates specific guideines DraftMpumaangaEconomicGrowth& DeveopmentPath Towardsamoreequitabeandincusiveeconomy February2011 Mpumaanga Province

17 Map 2: The Goden Triange, Mbombea about deveopment panning appication processes and the roe that provincia and oca government pay. The foowing egisation appies to the CoM: Spatia Panning and Land Use Management Act 16 of 2013 > the mandate for oca government is to fundamentay pace deveopment panning processes in the domain of the oca municipaity. As a means of providing a uniformed deveopment appication approach, SPLUMA stipuates that each municipaity is responsibe for the estabishment of a municipa panning tribuna or any other authority to mandate and deveopment decisions. SPLUMA indicates that oca municipaities must deveop an SDF, IDP, and and use scheme. According to SPLUMA, each municipaity shoud aso deveop municipa panning by-aws that are in ine with the reguations stipuated in the Act. Municipa Spatia and Economic Poicies > The objective of the Mbombea Loca Municipaity Spatia Deveopment Framework ( ) is to present a strategic roadmap guiding decision-making associated with the deveopment of and within the municipaity. This incudes the conception of principes and directives regarding spatia deveopment to direct pubic and private sector investment. The Mbombea SDF highight severa key spatia strategies as a means of ensuring the reaisation of its spatia vision. These strategies refect the unique context of the oca municipaity, and are adapted to foster economic growth as per the needs of the community. Strategies incude the foowing: The creation of a Municipa Open Space System (MOSS); Protection of prime agricuture and; Prioritise and reform; Deveop rura-based tourism; Deveopment of an integrated movement system; Pan compact urban growth; and Prioritising deveopment in Economic Opportunity Zones. Utimatey, the primary objective of the SDF is to ensure responsibe deveopment that prioritises the economic and socia empowerment of the community, whie retaining environmenta sustainabiity. The Mbombea Loca Economic Deveopment Strategy (2015) serves to highight potentia projects to unock economic growth within CoM, with specific reference to empoyment creation and SMME empowerment. The LED Strategy highight the critica economic sectors that wi catayse oca economic growth over the ong term, incuding agricuture, trade, manufacturing, tourism, and construction. Together in partnership, stimuating economic deveopment by providing efficient service deivery, meeting the needs of oca communities, and creating an enabing environment for business deveopment, economic growth and empoyment creation Mbombea LED Strategy As per the mandate of the municipaity, the Strategy envisions oca economic growth and deveopment in accordance with the foowing objectives: Land Deveopment Appications n 3.1 Types of Deveopment Appications There are two distinct categories of deveopment appications that are addressed in this report. These are buiding pan appications and Land Use Management (LUM) appications. Typicay, buiding pan appications have to adhere to a specific set of standards, whereas LUM appications tend to be more compex. n Buiding Pan Appications The purpose of a buiding pan appication is to permit the new construction of buidings in order to compy with the minimum construction standards and specifications, as specified in the Nationa Buiding Reguations and Buiding Standards Act No. 103 of According to the Act, any new or additiona ateration to the existing structure of a An efficient and enabing municipaity with exceptiona infrastructure; An incusive municipa economy; An innovative and technoogicay advanced municipaity; An education and skis deveopment orientated municipaity; and An environmentay friendy and tourism centred municipaity. buiding is to be approved by the CoM. The Act requires that any buiding pan appication must satisfy both the requirements of the Act and any other appicabe aws pertaining to issues reating to the environment, heritage, panning etc. According to the Act buiding pan appications incude - the ateration, conversion, extension, rebuiding, re-erection, subdivision of or addition to, or repair of any part of the structura system of any buiding. n Land Use Management Appications LUM is the egisative mechanism through which new deveopment is approved and managed, and is therefore an impementation too for municipa spatia deveopment frameworks. Depending on how it is impemented, LUM can be utiised as Map 3: LED opportunities, CoM Section 3 30 Mpumaanga Province Mpumaanga Province

18 an effective supporting mechanism for growth management. The types of LUM appications that exist as per SPLUMA, are summarised in the foowing section. A LUM appications are carried out in terms of the Spatia Panning and Land Use Management Act 16 of SPLUMA divides and deveopment and and use appications into category 1 and 2 appications. The foowing category 1 and 2 appications can be made at CoM: Category 1 Appications A category 1 appications and a opposed category 2 appications must be referred to the Municipa Panning Tribuna The estabishment of a township or the extension of the boundaries of a township. The amendment of an existing scheme or and use scheme by the rezoning of and. The remova, amendment, or suspension of a restrictive or obsoete condition, servitude or reservation against the tite of the and. The amendment or canceation in whoe or in part of a genera pan of a township. The subdivision 4 and consoidation 5 of any and other than a subdivision or consoidation which is provided for as a category 2 appication. Permanent Cosure of a pubic pace. Any consent or approva required in terms of a condition of tite, a condition of estabishment of a township or condition of an existing scheme or and use scheme. Any consent 6 or approva provided for in a provincia aw. Some of the above mentioned and use appications are defined as foows: The estabishment of a township or the extension of the boundaries of a township The estabishment of a township is where and is subdivided into individua and parces or erven for various and uses incuding roads and pubic paces (open space). The amendment of an existing scheme or and use scheme by the rezoning of and (Rezoning) zoning assigns certain rights to a property (it normay specifies what the free entry, consent and prohibited and uses are and sets out the imitations and buk factors for the zone). The initia zoning is normay undertaken by the municipaity when a scheme is prepared and an appicant wi then seek to amend the scheme and/ or rezone the and in question. Cases may however exist where properties fa outside a scheme and an initia zoning is sought by an appicant for the and s incorporation into a scheme (MILE, 2013) The remova, amendment, or suspension of a restrictive or obsoete condition, servitude or reservation against the tite of the and - Appications submitted due to obigations or restrictions which are binding on the owner of the and by virtue of a restrictive condition or servitude registered Category 2 Appications A category 2 appications that are not opposed must be considered and determined by the authorised officia The subdivision of any and where such subdivision is expressy provided for in a and use scheme. The consoidation of and. The simutaneous subdivision and consoidation of and. The consent of the municipaity for a and use purpose or departure or deviation in terms of a and use scheme or existing scheme which does not constitute a and deveopment appication. The remova, amendment or suspension of a restrictive tite condition reating to the density of residentia deveopment on a specific erf where the residentia density is reguated by a and use scheme in operation. 4 The division of a piece of and into two or more portions (SPLUMA Reguations Schedue 5(4)) 5 The joining of two or more pieces of and into a singe entity (SPLUMA Reguations Schedue 5(4)) 6 A and use right that may be obtained by way of consent from the municipaity and is specified as such in the and use scheme. (SPLUMA Reguations Schedue 5(4)) against the and, condition of approva for the amendment to the municipaity s scheme; a condition of approva for the subdivision or consoidation of and; a condition of approva for the deveopment of and situated outside the area of a scheme; or a condition of approva for the phasing or canceation of an approved ayout pan. The amendment or canceation in whoe or in part of a genera pan of a township - Appications for the phasing or canceation of an approved ayout pan for the subdivision or the deveopment of and. Such appications normay occur when a deveoper has second thoughts on a particuar township deveopment and wants to phase or stagger such deveopment and/or wishes to modify the ayout pan over a portion of the origina township area. (MILE, 2013) The subdivision and consoidation of any and - Subdivision normay refers to the subdivision of a parent erf into a imited number of portions of the origina erf and each portion is so designated. Consoidation occurs when severa erven are consoidated into one newy designated erf with a new number. (MILE, 2013) Permanent Cosure of a pubic pace Appications for the permanent cosure of open space or roads. Cosure of such and has often been cosey associated with the consoidation and re-subdivision or re-ayout of and and where it is incorporated into the proposed new township. n 3.2 Reguatory Entity Responsibiities To have a comprehensive understanding of deveopment appication types and processes, it is important to understand where the responsibiity of appication administration ies. Deveopment appications consist of both and use management appications (LUM) as we as Buiding Pan appications. In terms of deveopment appications, the ega framework is evoving swifty and oca and provincia governments are engaging in a aw reform process to ensure that a and use panning activities can function accordingy. The foowing section provides an overview of the reguatory entity responsibiities as stipuated by panning aw. Land Use Management Appications As previousy indicated, SPLUMA had various impications on the operations of both municipaities and provinces in terms of their responsibiities and functions within the former egisative environment of deveopment panning. Of significant importance for a provinces and municipaities is the finaisation of a appeas, and use and deveopment appications which have been submitted in terms of egisations preceding SPLUMA. From a spatia panning perspective, SPLUMA stipuates the roes and responsibiities of each sphere of government. According to SPLUMA the roes and responsibiities of each sphere are as foows: Nationa Government > Shoud monitor and support provincia and municipa spheres of government whist prioritising nationa interests. In addition, it is the responsibiity of nationa government to estabish and review nationa deveopment poicies that are designed to monitor other spheres of government. Furthermore, SPLUMA Section 13 indicates that (1) The Minister must, after consutation with other organs of state and with the pubic, compie and pubish a nationa spatia deveopment framework. Provincia Government > Responsibe for monitoring the compiance of oca municipaities with SPLUMA. Furthermore, SPLUMA Section 15 indicates that (1) The Premier of each Province must compie, determine and pubish a provincia spatia deveopment framework for the Province and (2) A provincia spatia deveopment framework must be consistent with the nationa spatia deveopment framework. Loca Government > Responsibe for the contro and reguation of and. SPLUMA indicates in section 20(1) that the municipa counci of a municipaity must by notice in the Provincia Gazette adopt a municipa spatia deveopment framework for the municipaity and in section 20(2) that the municipa spatia deveopment framework must be prepared as part of a municipaity s integrated deveopment pan in accordance with the provisions of the Municipa Systems Act. In addition, SPLUMA section 24(1) requests that a municipaities shoud adopt and approve a singe and use scheme within 5 years of the commencement of SPLUMA. A and use management appications, incuding appeas, wi be processed by the oca municipaity. Because of SPLUMA, municipaities are mandated with significanty more responsibiity in terms of spatia panning and and use management. First and foremost, a oca municipaities are required to deveop municipa by-aws in terms of SPLUMA. The purpose of the municipa byaws is to give effect to Municipa Panning as contempated in the South African constitution and thereby aying down and consoidating deveopment appication processes and procedures. 32 Mpumaanga Province Mpumaanga Province

19 Buiding Pan Appications Buiding pan appications are reguated by the Nationa Buiding Reguations and Buiding Standards Act No 103 of The Act stipuates that approva is required from the respective oca authority prior to the construction or ateration of any buidings. As such, oca municipaities undertake a decisions made on buiding pan appications. A buiding pan appication appeas are deat with by the nationa review board which is to be set up by the Minister. n 3.3 Reguatory Transformations It is important to note that the reguatory environment in which and deveopment and panning operates has undergone tremendous reform. The egisative measures that used to govern panning and appication processes have changed and the foowing section intends to highight some of the key changes and their deveopment impications. The buiding pan appication process remains unchanged, however with the procamation of SPLUMA many changes are occurring in the and use management processes. The foowing key changes incude: A provincia ordinances inconsistent with the Act are repeaed, or otherwise amended through provincia egisation. Laws repeaed by SPLUMA incude the Remova of Restrictions Act No 84 of 1967; the Physica Panning Act No 88 of 1967; the Less Forma Township Estabishment Act No 113 of 1991; the Physica Panning Act No 125 of 1991; and the Deveopment Faciitation Act No 67 of Comprehensive and uniform panning system - SPLUMA stipuates that no egisation not repeaed by the Act may prescribe to an aternative or parae mechanism on spatia panning, and use, and use management and and deveopment inconsistent with the Act. The deveopment of municipa panning by-aws as a way of stipuating the new deveopment appication processes. Foowing the forma reease of SPLUMA in Juy 2015, the CoM initiated the process of deveoping the municipa panning by-aw, referred to as the Mbombea by-aw on spatia panning and and use management. The by-aw is written in terms of SPLUMA which, among other, sets out the deveopment principes that appy to a organs of state and other authorities responsibe for and use reguation and management. The by-aw provides information and approaches regarding the foowing municipa functions of the CoM: Municipa spatia deveopment framework and and use scheme; Institutiona structure for and deveopment and and use management decisions; Deveopment management; Appication procedures; Engineering services and deveopment charges; Appeas and hearings; Compiance and enforcement; and Traditiona provisions. Deveopment Panning and Appication Administration Processes The commercia private property is an exceedingy vauabe commodity within South Africa and property deveopment processes shoud therefore be treated with utmost scrutiny in order to warrant economicay sustainabe property deveopment and sector growth. Unfortunatey, the deveopment appication processes have become quite compex. Athough the stakehoders within the property deveopment process have different motives, it is important to recognise that a stakehoders, abeit the private or pubic sector, equay aspire to finaise property deveopment processes. Diagram 1 summarises, theoreticay, the various components of the generic and deveopment process, incuding and use management and buiding pan appications. It shoud be noted that this is a generic process, the detaied processes are outine in the remainder of this section. Land Use Management Approva SUBMISSION OF LUM APPLICATION A appications must be accompanied by: - Competed appication form - Power of attorney - Bondhoders consent - Motivation - Copy of SG-Diagram - Locaity and site deveopment pan - Proof of payment PUBLIC NOTICE Advertising NOTICE TO ORGANS OF STATE AND INTERNAL CIRCULATION ASSESMENT BY RELEVANT DEPARTMENTS Section 4 FINAL APPLICATION DECISION When LUM approva has been granted, the foowing information shoud be competed within 24 months of approva (if appicabe): :Municipaity Lega Admin Buiding Pan Approva RECORD OF RECEIPT 30 DAYS NOTICE OF OUTSTANDING INFORMATION SUBMISSION OF FINAL BUILDING PLANS ONLY WHEN REQUIRED SCRUTINY COMMENTS AMENDMENTS COMMENTS REQUIRED WITHIN 60 DAYS (ORGANS OF STATE) AND 21 DAYS (INTERNAL CIRCULATION) FINAL BUILDING PLAN DECISION APPEAL Appicant To compy with a conditions of approva BULK SERVICES AGREEMENT AND APPROVAL Buiding Pans with GLA: >500m² : 30 days to approve/reject <500m² : 60 days to approve/reject (Nationa Buiding Reguations and Standards Act 103, 1997) What s happening in Mbombea? The Ianga Ma, which opened its doors for the first time in 2010, is currenty in the process of being expanded, which is said to be compete in September The expansion, which incudes the deveopment wi feature a Ster-Kinekor cinema, an ice-skating rink, and an entertainment area with expanded restaurants, wi increase the tota foor space by approximatey m². New additions to the Ma incudes the internationa brand H&M from Sweden, Queenspark, Excusive Books and Contempo. Other existing stores is in the process of expansion of their respective foor areas. The expansion of the retai space is aso accompanied by additiona covered parking, new entrances to the ma, as we as a change in road access to the site (additiona traffic circes and traffic ights). The and deveopment appication process has severa crucia components. Before an appication is submitted it is important that the oca municipaity is consuted by the appicant to determine firsty, whether the appication is in ine with the municipaity s spatia deveopment framework, and secondy what documentation is required as part of the proposed appication. Once the appication is submitted and recorded, the appicant must within 30 days of notice that the appication is compete pace a pubic notice of the appication and provide proof thereof to the CoM. According to the by-aw, appicants must give notice on the foowing appications: An appication for a rezoning; The subdivision of and arger than five hectares inside the outer imit of urban expansion as per the municipa spatia deveopment framework; Subdivision of and arger than one hectare outside the outer imit of urban expansion; An appication of the estabishment of a township; Diagram 1: Generic Appication Process 34 Mpumaanga Province Mpumaanga Province

20 Diagram 2: SPLUMA Reguation 16 SPLUMA REGULATION 16 Phase1: Administrative Phase 12 MONTHS (365 Days) Phase2: Consideration Phase 3 MONTHS (90 Days) Phase3: Decision Phase The cosure of a pubic pace; Appication in respect of a restrictive condition; and Other appications that materiay affect the pubic or community interests. Simutaneousy, notice is given to organs of state and invited to comment within 60 days of notifications. In addition, the appication is circuated internay to any department that may have a direct interest in the appication for comment within 21 days of receipt. Once a comments have been received the appicant can make amendments to the appication after which the appication wi be considered for approva. When no appea has been odged against the fina decision on the appication, the post approva process of 24 months can commence. The post approva process invoves roe payers from both the pubic and private sectors. It is the responsibiity of each entity to ensure that the post approva requirements are met within the designated timeframes. If the requirements cannot be met, the appicant may appy for an extension of time. Once a the requirements are met, the buiding pan appication process can commence. It shoud be noted that for the purposes of this study, the LUM and buiding appication processes are anaysed independenty. In other words, the anaysis does not evauate the post LUM approva period, but rather anayses the process from the submission of the appication to a decision made on each of the respective appication processes. The foowing sections intend to provide ONLY AFTER APPLICATION IS SUBMITTED AND COMPLETE PUBLIC PARTICIPATION NOTICES INTER GOVERNMENTAL PARTICIPATION MPT OR AO MAKES DECISION ON APPLICATION MUST BE MADE WITHIN 30 DAYS OF LAST MEETING OF MPT OR AO detai in terms of the buiding pan and LUM appication processes as currenty impemented by the CoM. n 4.1 Land Use Management Appications n SPLUMA appication processes A oca municipaities are egay mandated by SPLUMA to deveop municipa panning by-aws to indicate the deveopment appication process. Importanty these appication processes shoud be in ine with the deveopment appication processes outined in the SPLUMA reguations. Chapter 3 of the SPLUMA reguations makes provision for and deveopment and and use appication processes, categories and timeframes. According to reguation 14(1) oca municipaities must determine the foowing: The manner and format in which LUM appications are submitted, incuding the appicabe fees to be paid; Subject to reguation 16 determine the timeframes for each appication; The pubic participation process as we as the inter-governmenta participation process; Procedures for site inspections and appication amendments; Location for appication submission; and Procedure for deaing with incompete appications. Diagram 2 indicates the appication timeframe as per reguation 16 of SPLUMA. According to the reguation, a appication processes sha consist of three phases. The first phase is the administration phase during which a pubic participation notices are pubished and responded to, a parties are informed and the intergovernmenta participation process finaised. The appication is then referred to the Municipa Panning Tribuna (MPT) or Authorised Officia (AO) for consideration. The next phase is the consideration phase, in this phase the MPT or AO decides on the appication and may undertake investigations if required. According to SPLUMA, if no decision Municipa Panning Tribuna Appicatins Considerations The appication shoud be in ine with the municipa Spacia Deveopment Framework The appication shoud not be in confict or negativey impact on the existing surrounding and uses High potentia agricutura and and formaising existing awfu and use is made within 3 months the appicant may report the non-performance of the MPT or AO to the municipa manager, who subsequenty reports it to the municipa counci and mayor. On the other hand, if an appicant fais to provide the required information to the municipaity, the appication may be deemed to be refused and the appicant wi have to resubmit. In addition, if no comments are received by any of the departments which the appication was circuated to, it wi be accepted that the respective department has no objection to the appication. The municipaity may aow a time extension for the comment period however, may aso report the department to the executive authority and Minister as a non-performance. The fina phase of the appication process is the decision phase in which the MPT or AO either approves or refuses the appication. Based on the above mentioned processes the CoM deveoped the municipa panning by-aws that was gazetted on the 10th of Juy The appication processes highighted in the Mbombea spatia panning and and use management by-aw, shoud be foowed by a appicants in the deveopment process. For the purposes of this study the foowing LUM processes are defined: Township estabishment Scheme amendment (rezoning) Subdivision and Consoidation It shoud be noted that the CoM has simiar target timeframes for these appication processes Township Estabishment When appying for the approva of a township estabishment at the CoM, the foowing process shoud be foowed: According to the by-aw, appying for a township estabishment appication invoves 8 steps and shoud take roughy 276 days, excuding a pubic hearing. The timeframes provided by the municipaity are used as guideines in the processing of the appication. The CoM aspires to continuousy foow the guided timeframes as per the by-aw, however acknowedges that in practice this is not aways the case. Tabe 1 provides more detai in terms of the expected number of days as we as the required documentation for the township appication to be processed. A crucia step in the appication process is ensuring that a of the required documentation is submitted with the appication. The CoM cannot process any appication if the required documentation is outstanding. Appicants shoud confirm with the CoM what the required documentation is prior to submitting the appication as a means of fast-tracking the appication process. The CoM is responsibe for notifying the appicant of any outstanding information on the appication which then paces the responsibiity on the appicant to provide the said information. As indicated, there is a considerabe number of documentation that is required as part of the appication. TOWNSHIP ESTABLISMENT APPLICATION SUBMISSION APPLICANT GIVES PUBLIC NOTICE Once a week for 2 weeks Notice for 14days on site LOCAL AUTHORITY DISTRIBUTES APPLICATION TO EXTERNAL DEPARTMENTS LOCAL AUTHORITY DISTRIBUTES APPLICATION TO DEPARTMENTS LOCAL AUTHORITY FORWARDS ALL COMMENTS AND OBJECTIONS TO APPLICANT LOCAL AUTHORITY CONSIDERS THE APPLICATION APPLICANT MAKES AMENDMENTS TO THE APPLICATION APPLICATION IS ESSENTIALLY APPROVED REPORT AND CONDITIONS OF ESTABLISHMENT ARE DRAWN UP Diagram 3: CoM Township Estabishment Process: PUBLIC HAS 30 DAYS TO LODGE AN OBJECTION 60 DAYS TO COMMENT DEPARTMENTS HAVE 21 DAYS TO COMMENT APPLICANT HAS 30 DAYS TO RESPOND NO RESPONSE INDICATES NO COMMENTS FROM APPLICANT (I) May carry out inspection (II) May determine date and time of hearing if necessary (I) Appication is approved subject to conditions: - Conditions of estabishment are drawn up - Lodging of pans for approva to the surveyor genera - Compiance with pre-procamation conditions (Section 4 - Opening of township register (Section 48 noti cation) - Procamation of Township (Section 49) - Permission to transfer erven (Section 68 certi cate) 36 Mpumaanga Province Mpumaanga Province

21 Tabe 1: CoM Township Appication Process Diagram 4: CoM Scheme Amendment/Rezoning Appication Process SCHEME AMENDMENT/REZONING SUBMIT APPLICATION AND PAY RESPECTIVE FEES APPLICANT GIVES PUBLIC NOTICE Once a week for 2 weeks Notice for 14days on site LOCAL AUTHORITY DISTRIBUTES APPLICATION TO DEPARTMENTS 21 DAY COMMENT PERIOD LOCAL AUTHORITY DISTRIBUTES APPLICATION TO EXTERNAL DEPARTMENTS LOCAL AUTHORITY FORWARDS ALL COMMENTS AND OBJECTIONS TO APPLICANT LOCAL AUTHORITY DECISION IF APPROVED: NOTICE IS PLACED IN THE PROVINCIAL GAZETTE Step Number of Days Appication Docs 1 2 Submit appication Loca authority noti es record of receipt, as we as competion status 1 30 Day 1 Day 2- Day 31 Competed appication form Power of Attorney Company Resoution 3 4 Appicant gives pubic notice and appication is circuated to Bondhoder s Consent Day 32- Day 91 externa departments Motivation Memorandum (Based on SPLUMA Loca authority distributes to interna departments for 1 Day 32 criteria) comments SG Diagram/ Genera pan 5 Comments received by a departments 21 Day 32 Day 52 Locaity Pan Appication Fee Payment Proof 6 Loca authority noti es appicant on comments and Tite Deed 14 Day 92 Day 105 objections Conveyancer Certi cate Appicant forwards response to comments and objections Appication is referred to the MPT or AO and decision is made Noti cation Period Day 105 Day 135 Day 136 Day 255 Day 256 Day 276 Community Approva Zoning Pan Land-Use Pan Site Pan Layout Pan Tota (with objections and externa circuation) 276 days Phasing Pan Food Line Certi cate Services Report Deveopment Charge Home Owners Comment NEMA Approva/Exemption Tra c Impact Study (if required) Geotechnica Report/ Letter signed by Engineer APPLICANT HAS 30 DAYS TO RESPOND TO OBJECTIONS MADE 60 DAYS TO COMMENT Appication Process can take 237 days if externa circuation is not required and no objections have been received. The appication process requires the invovement of both the CoM and the appicant to ensure that the timeframes provided are met. By working together, the appication process can be streamined and without any unnecessary deay. Scheme Amendment (Rezoning) An appication for the amendment of the and use scheme, aso referred to as a rezoning, is competed by foowing the process highighted in Diagram 4. As with the township estabishment appication process, the rezoning appication process foows a specific process whereby the appicant shoud ensure that a the required documentation is submitted with the appication. In addition, the appication wi undergo pubic scrutiny prior to approva. If the CoM is satisfied with the appication and comments received from the pubic and municipa departments, it can decide on the appication. Tabe 2 provides additiona detai into the steps invoved in the rezoning appication process as we as the required documentation. As indicated that target timeframes for processing a rezoning appication is roughy 276 days, however can be reduced to 237 days if externa circuation is not required by the CoM and if no objections were received on the appication. Subdivision and Consoidation The appication process for a subdivision or consoidation appication foows a simiar process and target timeframe as that of the rezoning and township estabishment appications. The target timeframe for any subdivision/ consoidation appication is simiar to that of the rezoning and township estabishment appications of 276 days (237 exc. externa circuation and objections). The CoM states that athough it foows a simiar process to that of the rezoning and township estabishment appications, certain aspects of the appication process might be exempted upon the discretion of the CoM and in ine with the by-aw. It shoud be noted that pubic notice is ony required when the foowing appies: The subdivision of and arger than 5 hectares inside the outer imit of urban expansion as per the municipa SDF. The subdivision of and arger than 1 SUBDIVISION/CONSOLIDATION SUBMIT APPLICATION AND PAY RESPECTIVE FEES APPLICANT GIVES PUBLIC NOTICE Once a week for 2 weeks Notice for 14days on site LOCAL AUTHORITY DISTRIBUTES APPLICATION TO DEPARTMENTS 21 DAY COMMENT PERIOD LOCAL AUTHORITY DISTRIBUTES APPLICATION TO EXTERNAL DEPARTMENTS LOCAL AUTHORITY FORWARDS ALL COMMENTS AND OBJECTIONS TO APPLICANT LOCAL AUTHORITY DECISION Step Number of Days Appication Docs 1 Submit appication 1 Day 1 Competed appication form Loca authority noti es record of receipt, as we as competion status Appicant gives pubic notice and appication is circuated to externa departments Loca authority distributes to interna departments for comments 30 Day 2- Day Day 32- Day 91 1 Day 32 5 Comments received by a departments 21 Day 32 Day 52 6 Loca authority noti es appicant on comments and objections 14 Day 92 Day Appicant forwards response to comments and objections 30 Day 105 Day Appication is referred to the MPT or AO and decision is made 120 Day 136 Day Noti cation Period 21 Day 256 Day 276 Tota (with objections and externa circuation) hectare outside the outer imit of urban expansion as per the municipa SDF. Tabe 3 (over page) indicates the appication process to be foowed in a consoidation/ subdivision appication. The CoM is pro-deveopment and therefore encourages that a and use management appications shoud be streamined to ensure maximum output. 276 days Power of Attorney Company Resoution Bondhoder s Consent Motivation Memorandum (Based on SPLUMA criteria) SG Diagram/ Genera pan Locaity Pan Appication Fee Payment Proof Tite Deed Community Approva Zoning Pan Land-Use Pan Site Pan Deveopment Charge Home Owners Comment NEMA Approva/Exemption Tra c Impact Study (if required) Appication Process can take 237 days if externa circuation is not required and no objections have been received. APPLICANT HAS 30 DAYS TO RESPOND TO OBJECTIONS MADE 60 DAYS TO COMMENT IF APPROVED: CONDITIONS MAY BE IMPOSED ENGINEERING AND OTHER SERVICES AGREEMENTS DRAWN UP Diagram 5: CoM Subdivision/ Consoidation Appication Process Tabe 2: CoM Scheme Amendment/ Rezoning Appication Process 38 Mpumaanga Province Mpumaanga Province

22 Tabe 3: CoM Subdivision/ Consoidation Appication Process Step Number of Days Appication Docs 1 Submit appication 1 Day 1 Competed appication form Loca authority noti es record of receipt, as we as competion status Appicant gives pubic notice and appication is circuated to externa departments Loca authority distributes to interna departments for comments 30 Day 2- Day Day 32- Day 91 1 Day 32 5 Comments received by a departments 21 Day 32 Day 52 6 Loca authority noti es appicant on comments and objections 14 Day 92 Day 105 Power of Attorney Company Resoution Bondhoder s Consent Motivation Memorandum (Based on SPLUMA criteria) SG Diagram/ Genera pan Locaity Pan Appication Fee Payment Proof Tite Deed Community Approva NBRS Act Section 5 Any appication in respect of which a oca authority refused in accordance with subsection (1)(b) to grant its approva, may, notwithstanding the provisions of section 22, at no additiona cost and subject to the provisions of subsection (1) be submitted anew to the oca authority within a period not exceeding one year from the date of such refusa (i) if the pans, specifications and other documents have been amended in respect of any aspect thereof which gave cause for the refusa; and (ii) if the pans, specifications and other documents in their amended form do not substantiay differ from the pans, specifications or other documents which were originay submitted; or (b) where an appication is submitted under section 18 Diagram 6: Buiding Pan Appication Process 7 Appicant forwards response to comments and objections 30 Day 105 Day Appication is referred to the MPT or AO and decision is made 120 Day 136 Day Noti cation Period 21 Day 256 Day 276 Tota (with objections and externa circuation) n 4.2 Buiding Pan Appications The buiding pan appication process is egisated through the Nationa Buiding Reguations and Standards Act No 103 of A buiding pan appications require and use management cearance prior to processing the BUILDING PLAN APPLICATION LAND USE MANAGEMENT APPLICATION APPROVAL SUBMIT APPLICATION PLAN INSPECTION AND CIRCULATION DECISION MADE ON THE APPLICATION APPROVAL OF A BUILDING PLAN IS VALID FOR 12 MONTHS Buiding ess than 500m 2 = 30 days Buiding more than 500m 2 = 60 days 276 days Zoning Pan Land-Use Pan Site Pan Deveopment Charge Home Owners Comment NEMA Approva/Exemption Tra c Impact Study (if required) Appication Process can take 237 days if externa circuation is not required and no objections have been received. appication. Diagram 6 iustrates the generic buiding pan appication process after and use management authorisation. Typicay, the buiding contro officer evauates the pans in accordance with the Act and any other aw incuding the town panning scheme of the respective municipaity. The pans wi aso be circuated to various city departments for comment and approva. In terms of the buiding pan appication timeframe the Act indicates the foowing: Where the architectura area of the buiding is ess than 500m² - the oca authority sha grant, or deny approva within 30 days after the receipt of the appication. Where the architectura area of the buiding is more than 500 m² - the oca authority sha grant, or refuse to grant approva within 60 days after the receipt of the appication. Where an appication is refused, the reasons must be provided in writing. The appicant may within 12 months of the appication being refused, re-submit the appication anew with no additiona costs, subject to the necessary amendments having been made. As previousy indicated, the buiding pan appication process can ony commence once LUM approva has been granted. The buiding pan appication is submitted to the buiding contro office aong with the respective appication fee prior to its consideration. During this process, the appication is scrutinised in order to ensure that a the required documentation is correct and accounted for. The appointed buiding contro officer evauates the appication and inspects the attached tite deed, the approved genera pan, any pre-procamation conditions, and the approved site deveopment pan. A buiding pan appications are stricty evauated by the reguations set out in the Act. To address amendments required on the appication, the appicant has access to a comments made on the appication right through the process. As part of the evauation process, the appication may be circuated to severa departments for comment. After the appication evauation, the appication is recommended either for approva or rejection. Once approva has been granted the appicant is notified and the pan is avaiabe for coection from the buiding contro office. The appicant can then commence with construction and shoud ensure that the buiding inspector is notified to, as mandated, inspect the process. Upon competion of the buiding construction or ateration, the appicant is issued with a certificate of occupancy confirming that the What s happening in Mbombea? The Mataffin Precinct is a prominent commercia deveopment within the City of Mbombea, and incudes a variety of housing types and tenure statuses, aowing for a range of affordabe units. Pubic transport, accessibiity and the provision of retai space are key components of this deveopment. Faciities to be deveoped incude educationa faciities (university, tourism-reated skis training); heath faciities; innovation hub; recreationa faciities. These faciities are considered potentia anchors to the deveopment. Currenty, the environmenta impact assessment (EIA) is competed, buk eectrica and water infrastructure instaed, and designs for phase 1 of the deveopment finaised. 40 Mpumaanga Province Mpumaanga Province

23 NBRS Act Section 14 Certificates of Occupancy in Respect of Buidings (1) A oca authority sha within 14 days after the owner of a buiding of which the erection has been competed, or any person having an interest therein, has requested it in writing to issue a certificate of occupancy in respect of such buiding. buiding has been buit in accordance with the approved pan. In the case of an appication being refused, the appicant woud be notified in writing. As provided for in the Act, the appicant, having amended, corrected or modified the appication, may re-submit the appication at no additiona cost. When an appicant desires to make an appea against the decision made on the appication, such an appication may be made to the high court. Any person who is aggrieved by the refusa of the oca authority to approve a buiding pan appication or who disputes the interpretation of a nationa buiding reguation or by-aw may appea to the review board in terms of section 9 of the Nationa Buiding Reguations and Standards Act 103 of NBRS Act Section 9 (1) Any person who- (a) Fees aggrieved by the refusa of a oca authority to grant approva referred to in section 7 in respect of the erection of a buiding; (b) Fees aggrieved by any notice of prohibition referred to in section 10; or (c) disputes the interpretation or appication by a oca authority of any nationa buiding reguation or any other buiding reguation or by-aw, may, within the period, in the manner and upon payment of the fees prescribed by reguation, appea to a review board (2) The review board referred to in subsection 1 sha consist of- (a) A chairman designated by the Minister; and (b) Two persons appointed for the purpose of any particuar appea by the said chairman from persons whose names are on a ist compied in the manner prescribed by reguation. Deveopment Panning and Appication Administration Processes The property deveopment sector in the Mpumaanga Province made a nationa contribution of 3.9% between January and February 2016, and has owered to 2.5% in January and February This suggests that the property deveopment sector is on a sight decine in the Province. However, the commercia buiding pans passed in the Province amounts to a tota of R47 miion for January-February 2016 and has increased to R78 miion for the same period in The contribution made by the Mpumaanga Province is reativey sma in comparison to provinces such as Gauteng and the Western Cape, nevertheess, the contribution made in the industry contributes to empoyment and weath creation in the Province. In terms of the vaue of commercia buidings passed in the province it is evident that the sector is growing and therefore attention shoud be given to ensure that the appication processes invoved in the deveopment of commercia properties are streamined. To identify whether there are any compications or difficuties with the appication processing system a comprehensive anaysis is required. As such, the purpose of this section is to offer the appication tracking measurements as a means of identifying the key chaenges within the appication system. Information is provided for the CoM as foows: Overa Municipa Appication Benchmark Statistics (Buiding Pans and Land Use Management Appications) Municipa Appication Sampe Anaysis (Buiding Pans and Land Use Management Appications) Key observations The overa appication benchmark statistics indicate the appication processing efficiency within the CoM in terms of the finaisation of buiding pans and and use management appications. This provides an overview of the generic shortcomings in terms of adhering to the timeframes provided by panning egisation. Subsequenty, the municipa appication sampe anaysis provides greater detai in terms of the appication processing system within the municipaity. For the purpose of this investigation a five year BUILDING PLANS PASSED JAN-FEB 2016/2017 BUILDING PLANS PASSED COMMERCIAL JAN-FEB 2016/2017 MPUMALANGA PROVINCE anaysis period was utiised from The purpose of the appication sampe anaysis is to essentiay determine the timeframe appicabe to decide on a and use management or buiding pan appication at CoM. The municipa appication sampe anaysis wi determine and interpret the administration proficiency. For this anaysis, a buiding pans and LUM appications for deveopments above R10 Miion in deveopment costs and from were requested and anaysed accordingy. In cases where the information was not avaiabe as per the criteria, a other appications were anaysed. The actua timeframes achieved to finaise the appications are compared to the maximum timeframes outined in the reevant egisation. In reference to the maximum timeframe it shoud be considered that generay municipaities have imitations associated with appication deaying factors that are outside of their contro and therefore, in practice the egisative responsibiity cannot Section 5 NATIONAL CONTRIBUTION 2016: R (3.9%) 2017: R (2.5%) COMMERICIAL CONTRIBUTION 2016: R (2%) 2017: R (2%) Figure 1: Mpumaanga Province: Buiding Pans Passed Source: STATSSA, Mpumaanga Province Mpumaanga Province

24 Figure 2: CoM Commercia LUM Appications Tabe 4: Rezoning Appication Sampe be paced on them entirey. In terms of the anaysis, the foowing key imitations are identified: Significant deay in obtaining information for Buiding Pan Appications aong with engthy processes in gathering of data. Substantia deays in receiving appication benchmark statistics for both buiding pans and LUM appications. In cases where exampes of commercia property coud not be provided, other and use appications such as arge-scae residentia deveopments were used. Land Use Management Appication Tracking Before identifying the key chaenges within the appication administrative processes of the CoM an anaysis of the overa appication benchmark is determined. The foowing information is representative of a commercia and use management appications within the CoM with a deveopment cost of above R10 miion. Figure 2 indicates the tota number of high-vaue commercia and use management appications processed by the municipaity from as we as the average processing time and the number of appications that were finaised in time. As indicated, the number of high-vaued commercia appications have increased since 2012, with 14 appications processed in 2012 and up to 27 in The average processing time has aso increased since 2012, and remains on average beow the target of 276 days. In terms the appications processed in time i.e. 276 days, it is evident that the appication processing efficiency rate has decreased from 92% in 2012 to 69% in 2015 and 82% in The very high appication processing rate shows that the administrative processes within the CoM is reativey efficient. To obtain a more comprehensive understanding of the high-vaued commercia appications at the CoM, a sampe of Rezoning and Township estabishment appications are anaysed. The sampes consist of 10 rezoning and 5 township estabishment appications. Tabe 4 indicates the sampe of rezoning appication obtained from both the private and pubic sector and was chosen randomy. It is evident that some of the primary chaenges in appication processing is incompete submissions as we as deays in terms of tribuna hearings and appication reports from the pubic sector. For appications to be processed efficienty, it is vita that a necessary documentation shoud accompany the appication. Appicants coud avoid deays by ensuring that proper communication is made with the municipaity in terms of what the documentation shoud be. The number of township estabishment appication submissions is reativey ower than rezoning appications, however the database received from the municipaity does provide some insight on the efficiency of the appication processing system. Tabe 5 provides detai on a sampe of 5 township appications. Appication type Processing Time (days) Township Estabishment 439 Township Estabishment 1110 Reason for Deay Amended Appication submitted due to request for amendments by Mbombea Objection was made by 1 objector, appea was made and a tribuna coud not be arranged (interna issues at Mbombea). A counci meeting was hed in September Tribuna hearing took pace 1/07/2015 Township Estabishment 134 Approved in time Township Estabishment 75 Approved in time Township Estabishment 224 Approved in time Rezoning type Processing Time (days) Reason for Deay Specia to Specia for industries, workshops, commercia use, service retai, motor saes, offices, pane beat 251 Approved in time Business 1 to Business 1 with decreased FAR 95 Approved in time Specia to Business 4 with amended deveopment contros 74 Approved in time Business 1 to Business 4 with decreased FAR 85 Approved in time Residentia 1 to Business Outstanding appication documents Residentia 3 to Business 4 with annexure conditions 1221 Hearing Agricutura with business rights to Specia for production faciities of paving and bricks Subdivision Rezoning Rezoning As indicated, the efficiency of township appication approvas at the CoM is reativey high. In the sampe, 3 of the appications were approved in time. The deays occurred in the remaining 2 appications were a resut of amendments that needed to be made on the appication as we as an appea made that resuted in a tribuna hearing. n 5.2 Buiding Pan Appication Tracking The buiding pan appication process is foowed by the approva of a and use management appication and, ike the and use management appication process, requires participation from both the private and pubic sector entities. Figure 3 indicates the average processing time for buiding pan appications within the CoM. As indicated, the maximum timeframe to process a buiding pan appication is 60 days (depending on the size of the property). The average processing time for 2012 was roughy 106 days, neary doube the egisated timeframe. In 2013 and 2014 the average processing timeframe is reativey efficient with 59 and 66 days for each year, however appication processing efficiency has decreased between 2015 and 2016 to 80 and 81 days respectivey. This suggests that there are some chaenges in the processing of buiding pan appications. According to the CoM, 425 Pending (submission 2016) Pending (submission 2016) Pending (submission 2015) Deayed as appication needed to be amended in terms of the proposed zoning (not Industria 1, but Specia) No approva has been issued as a report must be competed before the approva etter can be issued. This report has not been competed, to date. Awaiting tribuna hearing. The hearing has been deayed due to canceation because of a ack of Tribuna members avaiabe, and the ack of avaiabiity of objector s attorneys. The submission of additiona documentation required by the municipaity, incuding a document which, according to the private sector representative, was not on the ist of requirements as received. the primary reason for deays is attributed to incompete submission of appications. The database provided by the municipaity does not indicate specificay what the reasons for deays are for each appication, however responses from the private sector suggest that in many cases poor communication in terms of what is required is a major concern in buiding pan appication deays. n 5.3 Pubic Sector Inputs on Appication Deays Through deiberations with the reevant municipa administrators regarding the timescaes of appications, numerous reasons for possibe were identified. Accordingy, this section seeks to iuminate the chaenges regarding the barriers pubic entities face in the timey processing of panning appications. Determining these chaenges invoved the foowing information-gathering exercises: Tabe 5: Township Estabishment Appication Sampe Figure 3: CoM Buiding Pan Appications 44 Mpumaanga Province Mpumaanga Province

25 1. Extraction of quaitative data through interviews with the reevant departments in the City of Mbombea Loca Municipaity; 2. Anaysing a sampe of appications as acquired from the aforementioned municipaity. This process highighted the foowing chaenges faced by the municipaity: Incompete appications with outstanding information on key aspects of the appication, which resut in significant deays in the appication process. The responsibiity ies with the appicant to ensure compete adherence to the reguations pertaining to the respective egisation. Content errors on motivating memorandums in the form of incorrect information and references, eading to unnecessary deays as the appicant is required to make amendments. Capacity issue in terms of registered Town Panners, which sows down the writing of evauation reports and signing of evauation reports as ony registered town panners can do the sign-off. Adaptabiity to SPLUMA eads to a process change with respect to the evauation reports and approva/rejection of appications, thus engthening the time it takes to sign off approva etters. Poor methods of communication with appicant with respect to comments and amendments required. However, a new system is in the process of being impemented that notifies appicants immediatey when new comments are made by the oca authority. Appicants are uninformed and unfamiiar with the reguations, causing deays as many appications don not compy with the reguations and appicants then need to re-appy and pay additiona costs. Backogs caused by amagamation with Umjindi Loca Municipaity as additiona appications need to be assessed by a sma group of peope due to the additiona capacity constraints suffered by the Umjindi Loca Municipaity. Other reasons for appication deays incude: - Objections received eading to Pubic Hearings. - Late preparations of appication advertisements by the appicants. What s happening in Mbombea? The University of Mpumaanga (UMP) was formay and egay estabished through the pubication of Government Notice (No ) on 22 August 2013 and aunched on the 31st of October The university offers severa programmes incuding Bacheor of Education (Foundation Phase); Dipoma in Hospitaity Management; Bacheor of Agricuture. Programmes added since 2015 incude the Dipoma in Agricuture (Pant Production) and a Dipoma in Information Communication Technoogy (Appication Deveopment). The Lowved Coege of Agricuture was formay incorporated into the UMP on the 1st of January Athough the UMP is currenty operationa, it is sti being constructed and expanded in certain sections of the site. The University is expected to grow rapidy in the next few years, once the infrastructure has been fuy deveoped and new programmes have been introduced. Private Sector Perspectives This section serves to iuminate private sector viewpoints concerning the appication processes in terms of and use management and buiding pans, respectivey. n 6.1 Approach To effectivey gather and accuratey communicate the private sector perspectives, the foowing sources were consuted: 1. The circuation of an appication tracking questionnaire to a suitabe sampe of private deveopment firms reevant to the study area. 2. Interviews with municipaity-reevant private entities. n 6.2 Key Limitations In undertaking the private sector appication processing anaysis, an important imitation is the inadequate response received from the identified private sector consutants in competing the research questionnaire. The reason for the imited response is the time constraints endured by the commercia private property sector associated with the end of financia year deadines at time of research. In spite of some reuctance from the private sector to respond to interview requests (on account of osing their anonymity resuting in future discrimination from the municipaity), the targeted interviews stimuated fuid discussions with private sector firms, proving invauabe and compensated for the imited questionnaire response. Interviewees incuded severa commercia private property speciaists in the CoM. n 6.3 Private Sector Inputs on Appication Deays The fundamenta issues identified by the private sector respondents incude the foowing: üthe ü new SPLUMA by-law engthens to the process as the new by-aw states that the municipaity has 30 days to acknowedge receipt of appication and to give notice to the competeness of the appication. This usuay takes 14 days but sometimes can take the fu 30 days. Deaying of distributing signed approva etters, which is deayed to between 4-8 weeks as a appications must be checked by a registered Town Panner. The CoM experiences a capacity issue with insufficient and use management staff, some of which aren t registered as Town Panners. New by-aw does not account for a scenarios, provisions and eventuaities, which resut in the deays when ega opinions are required. Deays in procamation of between 2-4 months are experienced as the by-aw does not make provision for procamations and Town Panners prefer to finaise procamations themseves. Tribunas are not controed according to egisation, as these tribuna meetings are not hed 120 days after objections have been received as the by-aw states. Tribunas have mosty been postponed or never took pace. Capacity issue in terms of tribuna members, as the tribuna members do not attend the set tribuna dates. The CoM does not make use of externa members, which aso adds to the capacity issue. There is aso a ack in the avaiabiity of objector s attorneys. Technica issues within the CoM as the private sector finds the system on which the appications are submitted is not user-friendy and inadequatey accessibe to a parties. This eads to mutipe visits to the CoM offices, deaying the appication process. Comments from two interna departments exceed the aocated timeframe. The majority of the private sector respondents agree that processes are deayed due to a deay in comments by the Eectrica Engineering Department, as we as the Fire Chief Department (for Buiding Pans). The other departments are effective and rapid pertaining to comments. Lack of cooperation and communication from externa departments, specificay experienced with SANRAL and Nationa Agricutura Department. Section 6 46 Mpumaanga Province Mpumaanga Province

26 Costing of Service Contribution payments are abnormay high and there is no indication or assurance where the payments are invested. Poor communication and accessibiity of various interna departments within the CoM, as they don t prioritise meetings with the private sector and are rarey accessibe or avaiabe shoud the private sector have enquiries. This causes an unreceptive reationship between the private sector and some of the CoM departments. The egaity of objections is questioned by the private sector as some objections appear irreevant or even occur after the deadine. Poicy inconsistencies. Some private sector respondents have experienced LUM decisions being taken contrary to what has been approved in poicy. Poor inter-departmenta communication, as we as between individuas within the same department resuting in poor information dissemination regarding priority and merit of appications. If communication is effective, it shoud ogicay acceerate the processing of appications. The checkist approach foowed by the municipaity when processing appications often has negative impications as it does not consider the appication merit in terms of the economic benefit for the community or pubic or practicaity in adhering to the conditions for deveopment. This is of particuar concern when an authorised officia is absent and the appication cannot progress due to this absence. Other reasons for appication deays incude: Due to deays in the competion of a report which is a prerequisite for the issuing of the subdivision approva etter. Requests to submit forms which are not isted on the ist of requirements for rezoning. Strengths identified by the private sector within the CoM and the appication processes are: Timeframes stipuated by the new By-Law are considered an improvement. The majority of departments are rapid with their comments and the process is sedom deayed due to deaying comments. Genera appications that encounter no objections usuay take approximatey 3 to 4 months to be approved. Decisions made by department heads indicate that the departments are ead by speciaised knowedge and high standards. The CoM s acknowedgment of appication receipt is effective and speedy. What s happening in Mbombea? The Crossings Centre has been expanded from a FAR of m² to m². The expansion started at the end of 2014 and was competed by the end of The expansion incuded approximatey 30 new stores, additiona parking areas, as we as the expansion of existing anchor stores. In effect of the expansion, an additiona entrance from Samora Mache Drive has been added and the upgrading of the existing entrance from the R40 resuted in the expansion of the R40 regiona road with the construction of additiona anes. Recommendations Section 7 The anaysis of the appication processing systems within the CoM has provided vauabe insights in terms of the shortcomings from both the private and pubic sector s perspective. As with many processes that invove numerous stakehoders, certain chaenges wi occur that utimatey resut in PRIMARY REASONS FOR APPLICATION DELAYS frustration and deveopment deays. The nature of the reationship between the private and pubic sector in the CoM is reativey good, however there are certain areas in which both the private and 1. Appication Administration pubic sector coud improve on. By acknowedging these chaenges and constructivey impementing ways of mitigating them, the property deveopment sector within the municipaity can deveop a momentum that wi have positive outcomes on the economy of the municipaity and the province entirey Capacity Issues Communication Technica Aspects The primary issues reated to appication process is summarised in Tabe 6. The foowing recommendations appy to the CoM as we as the private sector stakehoders operating within the municipa region. It shoud be noted that the recommendations highighted in this section are intended to guide the municipaity and private sector stakehoders towards improving the appication administration process. Both the municipaity and the private sector stakehoders shoud endeavour to positivey respond to the presented recommendations and shoud aso expore aternative methods of improving the appication administration process. Appication Administration Pubic Sector Recommendations The anaysis indicated a few chaenges within the administrative system of appication processing. The chaenges identified incude administrative probems with appication submissions, in particuar the submission of incompete appication documentation: 1. The municipaity shoud activey promote and enforce the submission of quaity and compete appications through continued engagements with the private sector property deveopers and appicants. 2. The pre-consutation process shoud be propery faciitated by the reevant departments within the municipaity. 3. Ensure that a departments and suboffices invoved in the processing of LUM and buiding pan appications foow a comparabe approach when processing Reason For Deay 1 APPLICATION ADMINISTRATION 2 CAPACITY ISSUES 3 COMMUNICATION 4 TECHNICAL ASPECTS appications. This wi enabe effective and accurate evauation of performances. 4. Information on the appication processes and requirements shoud be more visibe to the private sector as a means of ensuring that appications are compete. In addition, appicants shoud be notified timeousy of incompete appications. 5. Accurate records shoud be kept of a appication fies for monitoring and evauation purposes. 6. The improvement of records management, in particuar appication fies, shoud be more efficient in the municipaity. Private Sector Recommendations In terms of the administration of appications by the private sector it is Key Issues Appications submitted by appicants are incompete and often have incorrect information Appication record fies are often incompete Information and data on appication processing efficiency is not kept effectivey to monitor finaisation timing System on which the appications are submitted is not user-friendy and inadequatey accessibe to a parties. Lack of personne capacity in certain departments resut in processing deays and backogs in the appication system Tribunas are not controed efficienty Communication gaps between externa departments and oca municipaity Poor communication between the oca municipaity and the appicant Poicy impementation is not aways in ine with the spatia panning poicies of the municipaity Appicants do not aways refer correcty to the reevant Town Panning Scheme or Spatia Deveopment Framework Lack of meaningfu participation between private and pubic sector regarding poicy formuation Poor adaptabiity to SPLUMA Tabe 6: Primary Appication Processing Deays 48 Mpumaanga Province Mpumaanga Province

27 important that a appicants acknowedge the responsibiity of ensuring that the process of submitting appications is done in a manner that contributes towards the improvement of the overa administrative process to benefit the entire property deveopment sector. The foowing recommendations are made in terms of improving the appication administration processes: 1. Make use of pre-submission consutation methods with the municipaity to deveop an understanding of the technica requirements of the appication. Preconsutations with the municipaity enabes interaction between private property professionas and pubic sector officias before the submission of appications and payments of the respective fees. 2. Ensure that the information submitted as part of the appication is accurate and updated. Memorandums shoud be we written and incude a the reevant information in order to avoid any misunderstandings. It is vita that no information is omitted from the appication. 3. A appicants shoud ensure that an accurate understanding of the requirements set out in the municipa by-aws is obtained. 4. If amendment requests are issued, quick responses to the requests are required to ensure that the process is not unnecessariy deayed. 5. Records of a appication documentation incuding correspondence with the oca municipaity and other entities shoud be accuratey kept. Capacity Issues Pubic Sector Recommendations The outcome of the anaysis indicated that there are capacity issues in a number of appication processing departments. The outcome of these capacity issues resuts in significant appication backogs within the administration process. The foowing recommendations shoud therefore be considered by the CoM: 1. Conduct an in-depth evauation on possibe staff shortages in a departments, in particuar municipa tribunas, and in response increase staff capacity where needed. 2. Provide continuous training opportunities for personne. Training shoud incude project management and administrative organising skis. Private Sector Recommendations In terms of the private sector s roe in enhancing capacity issues within the CoM the private sector coud possiby provide sponsorship to oca municipaities in terms of training municipa officias or providing additiona resources with the aim of improving the knowedge and skis. Furthermore, it is recommended that SAPOA commits to offering reevant basic training to the pubic sector at a reasonabe rate to faciitate capacity and genera knowedge of the property sector. Added to this, SACPLAN shoud pay a roe in terms of ensuring that quaified town panners are we versed in property reated matters. Communication Pubic Sector Recommendations The processing of LUM and buiding appications invove extensive engagements between various departments within the pubic sector as we as engagements with the private sector (appicants). To ensure that the engagements are productive it is important that the foowing recommendations are considered: 1. During the processing of appications, the responsibe officia shoud be in continuous communication with the appicant as we as the departments that the appication is circuated to. 2. In cases where probems with the appication have been identified it is important that communication to the appicant is done timeousy. 3. Avoid misunderstandings by communicating in a manner that is understandabe to a parties invoved in the processing of the appication. Private Sector Recommendations In terms of the private sector s roe in terms of improving reations and communication the foowing recommendations appy: 1. Private sector firms shoud take active steps to continuousy improve their reationship with the oca municipaity through continuousy enhancing communications methods. 2. Appicants shoud respond timeousy to requests made by the municipaity with regards to their appications. Technica Issues Pubic Sector Recommendations Severa technica aspects invoved in the appication process were identified in the anaysis, these incude discrepancies between impementation and poicies, poor adaptabiity to the new SPLUMA reguations and appicants not referring to the correct town panning scheme or spatia poicies of the municipaity. To mitigate these issues the pubic sector shoud Primary Reason for Deay Appication Administration Capacity Issues Communication Technica Issues Private Sector Recommendations 1. Make use of pre-submission consutation methods with the municipaity to deveop an understanding of the technica requirements of the appication. Pre-consutations with the municipaity enabes interaction between private property professionas and pubic sector officias before the submission of appications and payments of the respective fees. 2. Ensure that the information submitted as part of the appication is accurate and updated. Memorandums shoud be we written and incude a the reevant information in order to avoid any misunderstandings. It is vita that no information is omitted from the appication. 3. A appicants shoud ensure that an accurate understanding of the requirements set out in the municipa by-aw is obtained. 4. If amendment requests are issued, quick responses to the requests are required to ensure the process is not unnecessariy deayed. 5. Records of a appication documentation incuding correspondence with oca municipaity and other entities shoud be accuratey kept 1. Private sector firms shoud take active steps to continuousy improve their reationship with the oca municipaity through continuousy enhancing communications methods. 2. Appicants shoud respond timeousy to requests made by the municipaity with regards to their appications 1. A private sector property deveopment professionas shoud famiiarise themseves with the municipa by-aw and spatia poicies of the municipaity 2. Poicy documents that specificay reate to the spatia deveopment of the municipa area, namey the Spatia Deveopment Framework shoud be incorporated as part of the appication submission process. This wi enabe an understanding among private sector deveopment professionas with regard to the type of and uses and the areas they wi be supported in consider the foowing recommendations: 1. Ensure that the municipa panning by-aw is a workabe document accessibe to a 2. Provide practica information sharing mechanisms that can be utiised by the private sector as a means of obtaining any new and reevant amendments made in terms of the reguatory environment (i.e. notices on website, newsetters etc.) 3. Land use management decisions shoud refect the deveopment objectives set out in the spatia deveopment frameworks and other deveopment poicies. Private Sector Recommendations The responsibiity ies with the private sector to make use of the egisative and poicy guideine documentation not ony Pubic Sector Recommendations 1. The municipaity shoud activey promote and enforce the submission of quaity and compete appications through continued engagements with the private sector property deveopers. 2. The pre-consoation process shoud be propery faciitated by the reevant departments within the municipaity. 3. Ensure that a departments and sub-offices invoved in the processing of LUM and buiding pan appications foow a comparabe approach when processing appications. This wi enabe effective and accurate evauation of performances. 4. Information on the appication processes and requirements shoud be more visibe to the private sector as a means of ensuring that appications submitted are compete. In addition, appicants shoud be notified timeousy of incompete appications. 5. Accurate records shoud be kept of a appication fies for monitoring and evauation purposes. 6. The improvement of records management shoud be more efficient in the municipaity. 1. Conduct an in-depth evauation on possibe staff shortages in a departments, in particuar municipa tribunas, and in response increase staff capacity where needed. 2. Provide continuous training opportunities for personne. Training shoud incude project management and administrative organising skis. 3. During the processing of appications, the responsibe officia shoud be in continuous communication with the appicant as we as the departments that the appication is circuated to. This can easiy be done through activey engaging through existing communication methods. 4. In cases where probems with the appication have been identified it is important that communication to the appicant is done timeousy. 5. Avoid misunderstandings by communicating in a manner that is understandabe to a parties invoved in the processing of the appication. 1. During the processing of appications, the responsibe officia shoud be in continuous communication with the appicant as we as the departments that the appication is circuated to. 2. In cases where probems with the appication have been identified it is important that communication to the appicant is done timeousy. 3. Avoid misunderstandings by communicating in a manner that is understandabe to a parties invoved in the processing of the appication. 1. Ensure that the municipa panning by-aw is a workabe document accessibe to a 2. Provide practica information sharing mechanisms that can be utiised by the private sector as a means of obtaining any new and reevant amendments made in terms of the reguatory environment (i.e. notices on website, newsetters etc.) 3. Land use management decisions shoud refect the deveopment objectives set out in the spatia deveopment frameworks and other deveopment poicies. 50 Mpumaanga Province Mpumaanga Province

28 to ensure that deveopment is aigned with the egisative and poicy directives, but aso to contribute to the objective of achieving a coective property deveopment approach among the private and pubic sector stakehoders. In terms of the technica aspects of appication administration, the foowing recommendations can be made: 1. A private sector property deveopment professionas shoud famiiarise themseves with the municipa by-aw and spatia poicies of the municipaity. 2. Poicy documents that specificay reate to the spatia deveopment of the municipa area, namey the Spatia Deveopment Framework shoud be incorporated as part of the appication submission process. This wi enabe an understanding among private sector deveopment professionas with regard to the type of and uses and the areas they wi be supported in. CAP Rate 10.73% Commercia Property Renta Income R/m2per month R Annua Renta Escaation 8.5% Average Construction Cost R/m2 R Average Operationa Income per month R/m2 R Average Operationa Expenditure per month R/m2 R Average Maintenance Cost per month R/m2 R Tota Rateabe Property Vaue R Tabe 7: Property deveopment variabe assumptions Section 8 Diagram 7: The economic modeing process Economic Impact of Appication Deays Any deveopment constitutes an injection into the oca economy. When this deveopment is deayed, its impact and mutipier effect on the economy wi aso be deayed. This amounts to economic osses equa to the injection that woud have been added by the deveopment. This section thus seeks to quantify this economic oss as a resut of deays in the reevant appication processes associated with the deveopment. The objective of this section is to iustrate to private and pubic sector entities the impact of inefficiencies in the appication process on the oca economy and property deveopment at arge. n 8.1 Approach In addition to the cost associated with deveopment, the financia feasibiity of any new deveopment is substantiay infuenced by time deays in getting the deveopment off the ground. As per the objective of quantifying the economic and societa impact of any given deveopment, the econometrica modeing technique that invoves the construction of a Socia Accounting Matrix (SAM) mode, is appied. Economic impact assessments are conducted to primariy determine how businesses, househods, and government wi be affected by a particuar intervention (investment in property deveopment, incuding housing, commercia spaces, and transport amenities) in the economy. The economic modeing is based on the capita (CAPEX) and operationa (OPEX) expenditure of the commercia property deveopment. For the purpose of this anaysis the CAPEX and OPEX were based on a number of industry standard assumptions. The impact is measured in terms of the direct, indirect and induced impacts of new business saes, GDP, empoyment and income. The economic impacts are defined as foows: Direct impact: Based on macro-economic aggregates as a direct consequence of the deveopment. Indirect impact: Based on activities of suppiers through appication of the mode. Induced impacts: Goods and services demanded due to increased expenditure by househods from income earned due to the project. The direct, indirect, and induced impact of the commercia deveopment is measured in terms of the stimuating effect on new business saes, GDP, job opportunities created, and income generated. Tabe 7 iustrates the assumption used in determining the economic impact of appication deays. These assumptions are based on industry medians and standards, adjusted to represent a conservative estimate. n 8.2 Quantifying the Economic Impact of Property Deveopment This section iustrates the findings of the Economic Impact Assessment (EIA) based on the determined assumptions and specifications. The basis of this EIA is theoretica and is not meant to epitomize the impact of existing deveopments in the CoM, but rather to iustrate the economic impact of appication deays. In addition to the specification indicated in Tabe 7, the economic mode is based on 10 commercia property deveopments, each 1000m2 in size. The EIA thus seeks to iustrate the impact of this deveopmenta injection on the oca economy. The tota economic injection is iustrated in Figure 4. The deveopment of 10 commercia properties of 1000m2 in the CoM has a tota economic injection of R Within this injection, 82% is attributed to CAPEX whie 18% can to OPEX. A comprehensive overview of the economic impact of this deveopment is iustrated in Tabe 8. It is evident that the impementation of 10 commercia property deveopments with an average size of 1000m² wi generate roughy R miion in new business saes. This suggests that for every R1 miion rand invested, approximatey R2.44 miion wi be generated. The primary industries affected by this is the rea estate (34%), construction (23%) and manufacturing (18%) sectors. Furthermore, the vaue-added component of economic activity, measured by the GDP, wi increase by roughy R miion, suggesting that for every R1 miion invested approximatey R1.05 miion wi be injected INCOME EXPENSES CAPEX R Figure 4: Tota economic injection INCOME EXPENSES OPEX R TOTAL ECONOMIC INJECTION R Mpumaanga Province Mpumaanga Province