Herron said the mayoral committee’s recommendation on Tuesday that the Salt River market site should be sold to a social housing institution‚ Communicare‚ for a fraction of its value‚ was driven by the need for affordable rental units.
“The 300 social housing units would be available to qualifying households who can afford to pay rent of between R625 and R4‚866 a month‚” he said.
Communicare will receive a subsidy of R80-million for building the 300 flats‚ and also plans 550 homes that will be rented at market prices‚ 350 parking bays and 2‚000m² of shops bounded by Voortrekker Road‚ Bromwell Street and the railway line.
Herron said: “The affordable rental units in high-rise buildings are only financially feasible and sustainable if the land is transferred at less than its fair market value and with a high level of cross-subsidisation from its mixed-use development concept.
“This is key to densified social housing projects in Cape Town. This site is currently undeveloped and is associated with anti-social behaviour. The proposed development presents the city with an opportunity to repurpose the site to the benefit of the whole community.”
The site‚ covering 13 plots‚ was valued at R18-million in 2014‚ and offered to Communicare at 10% of this sum: R1.8-million. But a new valuation this year said the land was worth R144-million.