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.
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.