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Expect mall boom as people flock to SA cities - minister

Jun 20 2016 07:52
Kaveel Singh, News24

Johannesburg  As South Africans flock to the cities, more shopping centres are on the cards, the co-operative governance ministry said over the weekend.

“The process of urbanisation creates extra opportunities for shopping centre development,” said Andries Nel, Deputy Minister of Co-Operative Governance and Traditional Affairs, in a speech prepared for delivery in Gallagher Estate, Midrand this weekend.

He said 63% of South Africans currently lived in urban areas. “This will rise to 71% by 2030. By 2050, eight in 10 South Africans will live in urban area," he said.

As such, “additional retail floorspace of 1.5 to 2.0 million metres squared could be warranted by 2021/25 mainly because of urbanisation”.

The middle and upper class segments of the market would grow by an additional two million households, he said, and, according to studies, retail spending could add over R70bn to the sector.

Needs of different markets

In building with these future demands in mind, those in the retail sector should better understand the specific needs of the different markets rising in city spaces, said Nel. 

“We mean business and our cities are ready to do business,” he said.

The reconstruction of public space in South Africa was a matter of justice, following the segregation of the apartheid years, Nel said. In particular, residential areas had to have sufficient transport access to employment hubs and services.

“This is a vision of diverse neighbourhoods with a mix of services and amenities and walkable human-scale urban environments,” he said.

In rebuilding public space, energy, waste, water supply and streetlights all needed to be improved, Nel said. "We need to guide the growth and management of urban areas in ways that unleash the potential… and reverse the terrible legacy of apartheid spatial injustice."

Facts about urbanisation

According to Nel, these are the facts about urbanisation:

- 63% of South Africans currently live in urban areas. This is predicted to rise to 71% by 2030. By 2050, eight in 10 South Africans will live in urban areas.

- Additional retail floorspace of 1.5 to 2.0 million square metres could be warranted by 2021/25, mainly as a result of urbanisation.

- The middle and upper class segments of the market are estimated to grow by an additional two million households.

- According to the United Nations, 54% of the world’s population live in urban areas. By 2050 this will increase to 66%. In 1950 only three in 10 people lived in urban areas.

- The UN has predicted Africa will be the fastest urbanising region between 2020 to 2050.

- Continuing population growth and urbanisation will add 2.5 billion people to the world’s urban population by 2050. Of these, 90% will be in Asia and Africa.

shopping centre  |  urbanisation  |  economy
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