Value creation in property development

Property development in the residential, industrial and retail sector encompasses a sequence of events that need to be followed to ensure not only the viability, but also the sustainability of the communities that are created through a well-orchestrated value chain that makes it possible for individuals and institutions alike, to invest and contribute to the creation of real estate assets within their community.

ChristIne CHIBAGE

Infrastructure services that include bulk water, sewer treatment facilities and roads infrastructure prepare land primarily and aid the property development process as reliance is placed upon these services to ensure that the property development projects can be implemented and the quality and standard of living for the beneficiaries is improved.

Yesteryear, as well as recent news, there have been reports on the challenges that have emanated from this lag in the upgrade and construction of infrastructure services by municipalities to cater for the anticipated growth in and around urban cities, towns and growth nodes in the country.

Property development companies, corporates and individuals have oftentimes had to fill in the gaps in the lag to develop bulk infrastructure services to facilitate the development of their projects.

The result is that these costs are simply added on to the property being developed and it is the consumer who pays exorbitant costs, which makes affordable residential properties inaccessible. The value chain in the property development sector is an onerous and oftentimes expensive exercise, as will be further elaborated on.

Market strategy is often the first focus point with the main drivers being the strategy that the property developer is seeking to achieve long-term, as well as focus on the target market for the end product, be it a stand, home, or commercial property for rental or outright sale.

Identification and acquisition of an appropriate and suitable property follows this step and although seemingly a straightforward process may be fraught with many legal challenges, so it is imperative that the suitability of the property is assessed before a purchase decision to ensure zoning and development proposals are in line with the municipal town planning scheme that is operative for the subject location as well as the proximity of the site to bulk infrastructure services alluded to earlier in this article.

The next focus area is the town planning and preparation of the land for development, which is the focus of this article. Since civil infrastructure and property development are positively correlated, it follows that for a project to be deemed successful, a property developer has to comply with some key legal issues which include Regional, Town and Country Planning Act. (Chapter 29:12) and Urban Councils Act (Chapter 29:15) and Council by-laws.

As per the statutory requirements, when a land developer has completed land development in terms of the subdivision and development permits issued by the local authority, a certificate of compliance is issued, which confirms the conditions of the subdivision or development permit that have been complied with by the property developer.

This compliance certificate makes it possible legally to transfer ownership to a purchaser, when the land is sold to third parties. The development permit thus places an obligation on the property developer to ensure that all civil infrastructure is designed, constructed and inspected.

Due to the lag in infrastructure services and current strain on these resources, property developers are becoming more involved in researching and finding solutions and new technologies that will not only aid the infrastructure requirements of their developments, but also lessen the burden on the municipal services that are strained.
The challenge though is how quickly the municipalities will adapt and incorporate these new solutions.

Owning a property or to invest in properties is an unquenchable thirst for many people. People generally consider acquiring properties to secure their long-term investments.
Suze Orman quotes: “Owning a home is a keystone of wealth, both financial affluence and emotional security.”

Eric Thomas points out that one cannot afford to live in potential for the rest of their life, at some point, they have to unleash the potential and make a move. This will only be achievable through transformation of land and settlement patterns by keeping up with global town planning practices and its result on the environment.

West Prop Zimbabwe is a property development company providing turn key solutions to sustainable property investments in Harare, be it for a first-time buyer or one adding to an existing property portfolio.

To this end, West Prop wants to leave a beneficial legacy that has positive environmental impact and a return on investment to all Zimbabweans. West Property Zimbabwe is working towards Zimbabwe’s bright future in line with Vision 2030.

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