Inclusive biz property is next goal

An inclusive commercial property policy, whereby informal traders trade side-by-side with formal businesses in shopping centres, is the next challenge for the commercial property sector to give black entrepreneurs and small enterprises a much-needed boost.

This according Prof Francois Viruly, a property studies lecturer at the University of the Witwatersrand's School for Construction Economics and Management and independent property economist, who warns he is not in favour of legislation regarding this type of policy because of the distorting effect it has on the market. "It has to occur voluntarily."

He believes now that the draft policy for inclusive housing is nearly finalised, it will be interesting to investigate an inclusive commercial property policy.

"Property owners have a role to play, especially in light of the Property Charter."

The inclusive housing policy stipulates that developers of new residential developments should allocate a percentage of their houses to cheaper residences. He says that in terms of an inclusive commercial policy, it should be investigated how informal traders can possibly gain access to the formal retail environment.

"The most important is to determine whether there is a commercial ladder, as in the case of the housing ladder."

With residential property informal housing is an important feeding market and the start of the housing ladder which launches home ownership.

Viruly says the commercial ladder can start at the informal trader on the street, who can move on and do business in the centre. "This way the tenants of the future can be created."

He says it has already happened to an extent in certain shopping centres, where smaller spaces are offered to entrepreneurs and small enterprises.

A good example is Hyprop's Rosebank Mall in Johannesburg, where street vendors in Cradock Avenue, adjacent to the shopping centre, are charged a special tariff.

Pieter Prinsloo, CEO of Hyprop, says the traders pay market-related rent for stalls and trade successfully. Some of them grow to such an extent that they can later afford a shop inside the centre. He says Hyprop also offers them training on how to manage their businesses.

"By including informal traders in your centre, the tenant mixture is broadened and makes the centre more interesting," he says.

Hyprop also apportioned a corridor, the Afri-bazaar, in Canal Walk in Cape Town to smaller traders, which is especially popular with tourists. The project entails about 15 traders who occupy a selling area of 10sq m each, and some of them are already trading for six years.

Although he supports the concept, he doesn't believe the large-scale inclusion of smaller traders in shopping centres will realise, but only in centres located in tourist destinations. – Elma Kloppers, Sake24

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