Regeneration creates new opportunities for investors
While regeneration of city centres around the globe brings about a new wave of investment and activity, the migration of people to these areas is also presenting a number of global infrastructure and development challenges. But, for governments and developers who are open to the opportunities this presents, significant returns can be attained.
This is according to George Radford, Head of Africa for IP Global – an international property investment company, who says that more than half of the global population live in urban areas and 1.5 million people are added to the global urban population every week. “As much as 90% of this urban growth will take place in Africa and Asia, which will place significant pressure on governments and developers to deliver jobs, transport, basic services and solutions to address the impact of climate change.”
SA’s urban revolution will contribute to economic growth
In Minister Malusi Gigaba’s recent budget speech, South Africa’s urban revolution was highlighted as a priority, with Government on course to position cities and towns as the engines of future economic growth. Gigaba referred to South Africa as an urbanising country, predicting that over 70 percent of households will live in urban areas by 2030.
Looking further afield, according to global real estate services provider Savills, as the regeneration of key cities has led to a boom in demand, over 40.7 billion euros was invested in residential accommodation in Europe in 2015 – a 57% increase on volumes from the previous year.
With these opportunities, urbanisation is certainly not without its challenges in terms of infrastructure.
Radford says that South Africa has great policy frameworks in place to deal appropriately with the process of rapid urbanisation resulting from the regeneration of the city centres. “However, it’s the implementation that remains a challenge. South Africa can learn from how other countries and international cities have implemented their policies to deliver solutions to cope with rapid urbanisation.
Transport remains a key challenge
Radford points out that another aspect of urbanisation that receives a lot of focus is transport – people living in cities need to get around. “In response to this, London has created the Crossrail project, which will reduce travel times across the city, while transporting more passengers. This project is set to be completed in 2018, and will increase central London’s rail capacity by 10%, placing an additional 1.5 million people within 45 minutes of the centre of the city.”
“Although London does not have the open land to build a new rail infrastructure from scratch, it has used engineers to deliver a solution for the massive influx of urban dwellers it is experiencing,” he adds.