Rabie Property Group recently announced that it had successfully leased over 30 000m2 of commercial and office space in its 250-hectare Century City development, in the Western Cape. The Group attributed this to the growing demand for office space in ‘smart cities’ and defines these as precincts in which living, work, shopping, and relaxation spaces are all within walking distance.
While this is an exciting preview of what may be to come, a short walk to work, the gym or shops do not, by definition a smart city make!
Wikipedia defines a smart city as A technologically modern urban area that uses different types of electronic methods and sensors to collect specific data. The information gained from that data is used to manage assets, resources, and services efficiently; in return, that data is used to improve operations across the city.
South Africa’s varied infrastructure challenges and limitations – from potholes and water supply interruptions to worsening load-shedding – as well as a lack of financing, make it very challenging to conceive of a truly smart city in the near future.
Instead, we should be focusing on the country’s industrial development zones (IDZs), which are designed to attract investment and stimulate economic growth. In 2019, it was reported that operational investments in all SEZs amounted to more than R19 billion, with another R43 million in the pipeline.
Local IDZs have already attracted an influx of residents, businesses, and commercial enterprises. They are driving infrastructure growth, job creation, and socio-economic development. Some are making significant inroads in the development of energy solutions (e.g. solar power) to address loadshedding and alleviate the strain on our power grid.
For investors, IDZs offer the following key benefits:
- Tax and financial incentives
- Improved transport and logistics networks
- Better wages and a high standard of living for their employees who reside within the zones (which, in turn, make it easier to attract top talent)
- They become part of the IDZ value chain – alongside other leading brands and businesses.
- Some of the IDZs are prioritising sustainability and the use of green tech – meaning resident businesses can align more easily to sustainability targets and ESG requirements.
- Strategic positioning ensures a competitive advantage, as the IDZs are situated in metros with accessibility to major ports, airports, transport routes, and lucrative markets.
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