Durban Inner City revitalisation: eThekwini proposes new development agency

The eThekwini Municipality has proposed that a dedicated municipal entity be created to revive and rejuvenate the Durban inner city following several years of urban decay and investment flight from the CBD.

 The municipality has proposed the establishment of the eThekwini Inner-City Development Company to address the challenges in the inner city.

A document setting out the deliberations and proposals for the establishment of the new municipal entity is currently available for public viewing and comment. The municipality confirmed it had issued the document.

It said in 2023 the municipal council approved several recommendations, including that “council resolves to commence with an exercise to review and decide on the appropriate mechanism to provide, significantly upgrade, extend and improve certain municipal services in the Durban inner city, as well as to drive inner-city urban regeneration and management.”

“The municipality has proposed the establishment of an Inner-City Development Company mandated to operate as a development agency, developer, and manager of inner-city properties and catalytic projects,” stated the document.

Detailing the need for this action, it said: “The findings from diagnostic studies indicate that the Durban inner city is facing crime and grime, inconsistent basic service delivery, uneven maintenance of key infrastructure, poor urban management, homelessness, and related social challenges. Property owners, tenants, and business operators (both informal and formal) add pressure to a fragile inner city and lack the necessary responsibilities associated with operating in the inner city. Collectively, this has led to the decline of the inner city.

“These problems have contributed to a flight of economic activity from the inner city through the loss of investor confidence, with better and more modern locations outside of the inner city serving as attractions for the relocation of existing investments as well as the attraction of new investments,” said the document.

It said the findings from a diagnostic study also indicate challenges related to internal municipal capacity, including insufficient resources to manage the inner-city strategy.

While entities such as Inner-City Area Based Management (ITRUMP) and the Inner-City Office exist, they lack adequate authority, staffing, and coordination mechanisms. Line departments are equally stretched for resources.

“After considering the different options, the options assessment indicates that a development company (municipal entity) which sits outside of the core municipality is the preferred route. Its main value lies in its ability to mobilise additional resources and capability, especially if the private sector or other parts of government, like the province, become involved, as well as to attract and retain specialised skills demanded in managing the inner city.

“The mandate of a company can potentially be more flexible than a municipal mandate and can thus evolve and respond to local needs in a more adaptable manner. However, it is crucial for the company to maintain a clear focus, both spatially (such as targeting a central business district) and functionally (like implementing urban renewal projects),” it said.

The City of eThekwini will maintain majority shareholding, with potential for additional shareholding, and the company will have a board of directors.

“The Development Company will be funded through a combination of annual transfers from the municipality as well as own revenues generated from development management services, property management, and other income streams to be developed over time.”

DA councillor Thabani Mthethwa welcomed the proposals and said the municipality is losing a lot of investment because of neglect in an area that is supposed to be a prime spot that can generate billions of rand in revenue. “What is proposed is that there must be a partnership between the municipality and the private sector, as the private sector will be able to inject resources and create jobs. The private sector must play a significant role in the revitalisation of this inner city.”

Democratic Liberal Congress (DLC) Leader Patrick Pillay said they support and welcome the establishment of a municipal entity.

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