Cornubia is dealt a blow

2013-08-23 00:00

THE retail side of Durban’s R24 billion mixed use flagship housing project Cornubia has been dealt a blow with the South African Sugar Association (Sasa) pulling its land out of the development.

But Sasa has denied leaving the deal, saying it was the developers Tongaat Hulett Developments (THD) who changed their minds.

This is more bad news for Cornubia, which is facing increased pressure from shack-dwellers growing impatient with the pace of construction of the RDP homes. Housing for nearly 500 families was expected to be ready by June yet it is unlikely that it will be completed by the year-end. Cornubia is the brainchild of the eThekwini Municipality and is meant to mirror Cosmo City in Gauteng, which offers a mixed housing facility for people from different social and economic backgrounds to live together.

The retail aspect, which was meant to comprise four phases and bring an expected R20 million in rates per annum to the eThekwini Metro and generate over R300 million in annual taxes, will now cover a smaller footprint than originally envisaged after a deal between Sasa and THD could not be concluded.

The R1,2 billion retail greenfield project, which was initially expected to cover an area of 51 hectares, has the potential to provide more than 2 000 construction-related jobs and 1 500 permanent employment positions.

While the Sasa portion for actual retail development was just 6,1 ha, it formed part of a 28 ha Sasa land parcel, which would have been used for transport infrastructure and other services.

While THD is adamant Sasa’s withdrawal will not have an effect on the overall development, there will be significant challenges in finding a new site for the Mt Edgecombe waste transfer station, a change in road layout and possibly a reduction in high density housing.

In the final environmental impact assessment (EIA) open for public comment until August 28, consultants Royal HaskoningDHV (RHDHV) stated that “no agreement between the parties (Sasa and THD) has been forthcoming and it is now expected that Sasa are no longer interested in a joint type of development and will proceed with their own plans for their property”.

The source of this statement comes from THD, according to the consultancy.

Sasa executive director Trix Trikam said they were approached to contribute a portion of their land holdings to Cornubia.

“As time has progressed THD have revised their plans for the area to take into account the requirements of the potential tenants for the development. These changed requirements meant that THD no longer require Sasa land for the retail park development,” said Trikam.

Asked to clarify the contradiction between Sasa and THD on why Sasa was no longer included, he said both organisations have signed an MOU regarding the land and “there is no contradiction. It was both a matter of time and changed requirements that resulted in THD revising its plans”, said Trikam.

Although asked, Sasa did not clarify whether they intended to develop the land independently.

According to the Cornubia Retail Development EIA, the project will consist of “large scale retail and commercial buildings” catering for the surrounding area. It will also be used to create black economic empowerment opportunities in “property development ownership and urban management” and to address the apartheid legacy of separate development.

eThekwini spokesperson Thabo Mofokeng said the land owned by Sasa was privately owned and “at this stage the city has no information regarding future development plans”.

Land ‘crying for development’

THE Sasa land parcel, valued by council at just over R3,5 million, was bought by Sasa in 1966, according to property search engine Lightstone. However its market value is likely to be significantly higher with houses in the Mt Edgecombe Country Estate less than a kilometre away being sold for in the last 24 months for between R2 million and R8 million.

THD director Cyril Gwala, who is leading the Cornubia Project and is a director of the Cornubia Industrial and Business Estate Management Association downplayed Sasa’s withdrawal.

“We initially approached Sasa in order to create better boundaries for the retail development. Sasa, being an NPO, is sensitive to issues such as tax implications. The process of acquiring the land might take too long for approval, hence we needed to look at new options. We decided in the interest of time to stick to our land holdings,” said Gwala.

He said the Sasa parcel of land “which is crying out for development” will in several years be surrounded by development.

“Going forward Sasa will want to develop the area,” said Gwala.

24 320 housing units proposed

THE overall Cornubia Project, covering an area of 1331 ha has seen the council purchase several private farms in the area.

Overall the total number of units proposed for the development is 24 320 units.

This will incorporate income brackets from R0 to over R15 000 per annum.

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