Despite a raging storm over the taxpayer-funded R200 million renovations to President Jacob Zuma’s home, hundreds of millions of rand more look destined for Nkandla’s new “Smart Town”, to be built 8km from the president’s home.
The Sunday Tribune has seen a new concept summary document, dated November 2012, giving the strongest indication yet that construction of the project’s first phase, a shopping mall, could kick off in a year’s time.
Sandton-based company Rural Smart Cities is adamant the shopping mall will be entirely privately funded.
The company is involved in a joint venture with the Masibambisane Rural Development Initiative (MRDI), chaired by Zuma and spearheaded by a blood relative, Deebo Mzobe.
While information remains sketchy on the source of funding for residential units, a boarding school and factories, all to be built as part of the so-called Umlalazi-Nkandla Smart Growth Centre (NGSC), the shopping mall is as good as a done deal.
“This is a commercial project and will be funded by private equity funds and a secured bank loan,” said company spokesman and co-director Keith Warmback. “If it doesn’t stack up commercially, it will not be continued.”
Although its track record in construction is unknown, and the names of its directors have only recently been submitted to the Companies and Intellectual Property Commission, the company plans to build a similar shopping mall in Hluhluwe, seven in the Eastern Cape, and one in Soweto Village, Zambia.
Warmback, a pastor, said his company was a non-political concern whose decisions were always informed by commercial viability.
“The president is not involved, as far as I know. We’re a business, and our responsibility is to make a profit to make our shareholders happy. The president won’t make the numbers.”
The concept summary reads: “As identified in the feasibility study, the NSGC is envisaged to initially be developed as a civic node, serving the surrounding community and agricultural projects that are aimed at ensuring food security and combating unemployment in the area.
“This will be followed by commercial and retail developments that also include government facilities.”
“Some commercial interests have already indicated a real interest in investing in the area. A retail centre is already in an advanced stage of planning, with anchor tenants signed up. It is awaiting final institutional decisions and approvals before construction commences.”
Other developments envisaged for the area include a boarding school, a further education and training college, small factory units, expansion of the existing Nxamalala clinic and agri-processing facilities.
Warmback said the company was still reviewing the document and would most likely make a decision by February. “The project is 70 percent confirmed. We believe it is a commercially viable venture,” he said.
Although previous reports have put the cost of the new development at R1 billion, Warmback said it was too soon to talk figures.
“The cost will only be known once the in-house survey, which will be informed by the needs and resources of the local population, is calculated. These calculations will determine the size and tenant mix of the shopping centre.
“Time frames are dependent on the results of the survey, drawing up and passing plans, and having tenants signed up. We see this process taking about one year, whereafter construction of the shopping centre can commence.”
Only once a certain number of tenants had signed up for the development would actual construction begin.
“The local population will always have a need to purchase services and goods. Rural shopping centres build rural areas, where there is a need for a shopping centre.
“Most rural areas have been neglected, resulting in the local population having to travel long distances to the nearest large town to purchase goods and services. This is costly.
“By building shopping centres in rural areas, the local population benefits from a greater supply of goods and services, at a better price. The quality of life is improved, as well as offering a source of employment.”
Mzobe and the Department of Rural Development and Land Reform could not be reached to provide more details on the rest of the project.
Responding to parliamentary questions from Cope’s Smuts Ngonyama this week, Zuma said the initiative was spearheaded in 2001 by the Nkandla community.
Zuma said no projects had been handed to the initiative. “The MRDI conceptualises its own partnership with the private sector and the government and works closely with these stakeholders and delivers projects to communities. The MRDI is a community-driven initiative that assists communities in mobilising resources, from both the private and government sectors.
“Government provides project-based support directly to communities, in line with the methodology proposed in the Comprehensive Rural Development Programme.” - Sunday Tribune