The South African Property Owner’s Association (SAPOA) National Council (NC)held its meeting on the 12 of October to receive reports from the various regions and the sub-committees which focus on various aspects of the property industry. The newly elected President of SAPOA, Malose Kekana, chaired the meeting.
SAPOA’s National Council meets twice a year and constitutes the Chairpersons of all 18 of its committees. These committees meet 4 times a year and collectively constitute 270 individual members representing member companies, who hold over 100 meetings annually at SAPOA.
The purpose of the National Council is for the committee chairs to report back on matters pertinent to the property industry which each of their committees have been dealing with.
The various regions reported several challenges that are faced by SAPOA members. The challenges include: the decision by municipalities to increase rates substantially as well as vacant Land rates without improvement in service delivery; threats to development posed by the Construction Mafia; need to accelerate the implementation of large infrastructure projects as a catalyst for private developers to continue investing in new developments; the need to find solutions for the red tape and delays in the municipal approval processes. Various municipalities are experiencing water shortages.
The NC noted that vast amounts of investment in new developments are being held back due to the dysfunction of many municipalities and in the process hampering job creation during construction and thereafter.
Kekana conveyed his concerns and highlighted that SAPOA should continue to develop key relationships with the local authorities. “We must continue to develop strategic relationships with local government and the property sector to endeavour to find solutions to red tape, the magnitude of challenges being experienced and delays in the municipal approval processes and procedures to increase development in the respective cities” said Kekana.
The Property Developers Committee raised a concern regarding amendments to the NHBRC Act. There are attempts to introduce the levy to cover residential alterations. SAPOA will be engaging relevant stakeholders to introduce a tiered levy approach with defined compensation and reimbursement provision. It was noted that the NHBRC is sitting on R7,5 billion in cash reserves and members need to be reassured that the funds are being used correctly.
Other concerns came from The Sustainability Committee which highlighted regulation for Non-residential buildings in South Africa requiring to submit and display an Energy Performance Certificate (EPC) or risk a R5 million fine, five years in prison, or both.
The regulations were gazetted on 8 December 2020 and will apply on 7 December 2022, meaning that building owners who have not yet acted have just over two months left to comply.
Committee have engaged the Department of Mineral Resources to ask for the extension of Energy Performance Certificates by 3 years. One of the sticking points is the standard of measurement used to define the nett floor area. SAPOA’s method and that of SANS 1544 differ. There is also no capacity to meet the December 2022 deadline due to the limited pool of accredited inspection bodies in South Africa. The industry cannot by any measure certify approximately 500 000 buildings with only 6 accredited inspection bodies approved by SANAS.
“The biggest issue facing the property industry is the disconnect between the government’s gazette which increased the limit of embedded generation without Nersa generation license from 1MW to 100 MW. There are still embedded generation requirements from Eskom and municipalities that needs to be adhered to before connecting to the grid” Said Kekana.
A letter was written to the Presidency to drive the amendment of the existing approval criteria. In light of the ongoing loadshedding crisis, government’s lack of common approach and responsiveness is disappointing and worsening the crisis.
The NC also noted the water shortages which are facing various municipalities. The NC observed that membership of SAPOA has remained stable following a drop during Covid due to cancellations mostly by individual and small professional firms. The trend is now reversing.
The Sustainability Committee informed that the industry is most likely not going to meet the 8th December 2022 deadline for Energy Performance Certificates (EPC’s), with CEO’s risking a R5 million fine, five years in prison, or both. The industry cannot by any measure certify approximately 500 000 buildings with only 6 accredited inspection bodies approved SANAS.
Kekana, called for SAPOA to pursue various avenues to hold government accountable and support government where there are capacity challenges. “In this regard, SAPOA will be engaging with relevant Parliamentary Committees and will forge a broad frontier with other business organisations including BUSA to ensure that business environment is improved” added Kekana.
The SAPOA CEO, Neil Gopal also emphasised that whilst Solar PV remains the easiest and cost-effective way to reduce one’s carbon footprint and deal with ongoing loadshedding which is escalating, cautioned that. “The ongoing delays from Eskom and local authorities to obtain embedded generation approval continues to be a risk to landlords.”
Kekana also took the opportunity to welcome new National Council members from FNB, Nedbank, Standard Bank, Transnet, Attacq and Old Mutual who have joined some of the committees.