Johannesburg mayor Herman Mashaba. Picture: Freddy Mavunda
Johannesburg mayor Herman Mashaba. Picture: Freddy Mavunda

Divercity Urban Property Fund has turned the first sod of the Jewel City redevelopment in Johannesburg's CBD.

The recently formed private property fund is investing in the inner city and one of its key projects being the multi-use asset, Jewel City, which will be worth more than R1.2bn when complete.

Divercity’s major shareholders, Atterbury Property, Ithemba Property and Talis Property Fund as well as its cornerstone investors RMH Property and Nedbank Property Partners, attended the ceremony where the first sod was turned by Johannesburg mayor Herman Mashaba, Joburg’s MMC for development planning Reuben Masango and nonexecutive director of Atterbury Property Fund Phuti Mahanyele.

Jewel City, which spans six city blocks which used to house SA's diamond and minerals trade, has been closed to the public for a decade.

By redeveloping its existing buildings and constructing new ones of over 40,000m², Divercity is converting it into the heart of a thriving, modern inner-city neighbourhood, Divercity CEO Wouter Vos said. The first phase of Jewel City is set to include housing, retail and office components, as well as a school, clinic, gym, while parking will also be added.

There will be 20,000m² of office space, and 1,200 new residential apartments in its first phase. A further 1,000 apartments may be added in the second phase.

Vos said the development will also create significant employment in the city; an estimated 1,279 temporary jobs and 1,384 permanent jobs.

In addition, it will contribute to the municipal and national tax base.

Mashaba said the project would help to alleviate Johannesburg's severe housing shortage. “This is a catalyst for igniting the City of Johannesburg. We are a city with a housing backlog of 300,000 and 160,000 of our people are looking for accommodation. One in three people in Johannesburg is unemployed and if Johannesburg isn’t working, SA has no chance of succeeding… This project is very important, not just for Johannesburg but also for SA, it’s important for Africa.”

Mahanyele, who spoke at the event on behalf of Divercity, Ithemba and Atterbury said the development could undo wrongs of the apartheid system. “It is so important to see development and redevelopment right here in our cities. It helps to undo apartheid-era spatial divides and move towards more inclusive environments. Divercity invests exclusively in inner-city environments with a focus on affordable homes and delivering this in better-to-reach precincts close to job opportunities and amenities, creating an environment that is wholesome for the people who live and work here. Divercity, as a founding principal and a core fund objective, is committed to the transformation agenda of SA.”

The Jewel City project will include a people-friendly walkway along Fox street. Its pedestrian walk links it with two other Divercity projects; to its west, the new Absa Towers Main redevelopment and, to its east, new residential developments in the Maboneng precinct.

With the reconstruction of Jewel City underway, its first tranche of retail, commercial and residential space will be ready by October next year. The precinct will be completed in 2020.

Divercity launched with a R2bn portfolio of residential assets, which will grow to over R4bn on completion of its latest development projects in the next two years.

andersona@businesslive.co.za