PANELS FOR SOUTH AFRICAN CITIES

The ULI Advisory Services program has conducted a series of panels in the Republic of South Africa. These panels have been conducted at the request of the World Bank in cooperation with the National Treasury of South Africa. These panels are provided to the National Treasury and to participating metropolitan areas that draw on the World Bank’s global experience and network of urban experts. The National Treasury’s Cities’ Support Programme (CSP) is a unit within the National Treasury that provides technical assistance to cities in South Africa. That assistance is aimed at helping cities manage the built environment in a way that promotes economic growth, job creation, access to basic services, environmental sustainability, and public accountability.

Port Elizabeth – Nelson Mandela Bay, SOUTH AFRICA

Date: November 1-6, 2015

Location: Port Elizabeth, South Africa

Sponsor: The World Bank and South African National Treasury

Subject Area: Urban Regeneration and Connectivity in the Baakens River Valley Precinct

Panel Chair: Marilee Utter, Executive Vice President District/National Councils of the Urban Land Institute
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Background and Panel Assignment

Working with the World Bank and the National Treasury, the Nelson Mandela Bay Municipality (NMBM) and the Mandela Bay Development Agency (MBDA) asked the Urban Land Institute (ULI) to address a variety of questions focusing on the Baakens River Valley Precinct (the “study area”) of Port Elizabeth, South Africa. These questions largely address how to realign the vision for and align the actions of the many parties (including NMBM, MBDA, Transnet, and Coega Development Corporation) involved in the future of the study area.

The study area is a 120-hectare (297-acre) site located just south of the central business district (CBD) in Port Elizabeth, a coastal city that is part of the NMBM and the largest city in the Eastern Cape Province. Bordering the study area on the east is the Baakens River, stretching 25 kilometers (16 miles) to the west, meeting the Indian Ocean at the Port Elizabeth harbor. Characterized primarily by open green spaces, historic building stock, and the Port of Port Elizabeth (owned and operated by state-owned entity Transnet), the study area and its surroundings also include residential, industrial, and institutional uses. Some notable sites include the recently renovated Tramways building, the St. George’s Park Cricket Grounds, Settlers Park, and the Nelson Mandela Metropolitan Art Museum. A prominent feature of the study area is the Port Elizabeth harbor, which includes a passenger terminal, a manganese port, a tank farm, a port used by the automobile industry, and a yacht club.

The sponsor, a team composed of representatives from the National Treasury’s Cities Support Programme and the World Bank, working with the NMBM and the MBDA, asked ULI to conduct an Advisory Services panel focusing on the Baakens River Valley precinct.

The panel was asked to respond to the following questions:

• Identify key strategies to align interests among NMBM, MBDA, Port/Transnet authority, including its separate entities, and Coega Development Corporation, Southernport, and the Nelson Mandela Bay Business Chamber.
• How can development in the study area achieve national goals and be competitive in a global market? What is needed to position the study area as a global destination in addition to the huge investment of the Coega Development Corporation that is already in place?
• How can NMBM strike a balance between economic and social considerations, including aspects of heritage and tourism, to ensure viable development and ongoing success for the waterfront?
• What is an effective land assembly strategy for the study area?
• What kind of business model is appropriate for the waterfront? What institutional arrangements or partnerships are necessary to ensure ongoing success for the waterfront?

Summary of Recommendations

The panel developed key feedback and recommendations (more specific recommendations and priorities are included in the conclusion of this report), including the following:

• Tell your story: The panel was incredibly impressed by the vibrancy and economic possibilities in Port Elizabeth, but feels strongly that more comprehensive marketing investments need to be made to tell the Nelson Mandela Bay story to the appropriate target audiences.
• Allow the public sector to create the environment for private investment: The NMBM, through the MBDA, should prioritize working with the private sector to negotiate new deals and take on the direct role and expense of development only as a last resort. Specifically, the MBDA can explore the strategic disposition of publicly owned sites to partner with the private sector on development projects that achieve social, economic, and cultural goals. In addition, the NMBM should take a look at any obstacles within regulatory processes to understand where improvements in efficiency can be made.
• Focus on regeneration before new building: Leverage the existing public and historic or vacant building stock in Port Elizabeth for regeneration opportunities. Although land values in downtown are currently low, regeneration is generally more economical and quicker than new construction.
• Foster and create more housing in the CBD: More housing in the CBD creates more activity, more jobs, and more wealth. It also puts more eyes on the street and makes the CBD a safer and more interesting place, attracting more visitors and more investment. The panel recommends that the NMBM explore incentives and other financial tools to encourage private development of housing within the CBD and explore redeveloping publicly owned buildings and sites through public/private partnerships. The panel recommends the NMBM consider appointing a dedicated staff member to take on encouraging housing and acting as an ombudsman, similar to what the city of Denver did in LoDo, its lower downtown area.
• Let champions lead the way: Look to the youth and the private sector for champions and allow them to participate and work together to make the Nelson Mandela Bay what it can be.