RIVER HORSE VALLEY BUSINESS ESTATE SOCIO ... IMPACT ASSESSMENT NOVEMBER 2012 Photos supplied by...

RIVER HORSE VALLEY BUSINESS ESTATE

SOCIO-ECONOMIC IMPACT ASSESSMENT

NOVEMBER 2012

Photos supplied by RHVBE Management Association

ETHEKWINI MUNICIPALITY

RIVER HORSE VALLEY BUSINESS ESTATE

SOCIO-ECONOMIC IMPACT ASSESSMENT

DRAFT 2

5 NOVEMBER 2012

PREPARED FOR:

eThekwini Municipality

Economic Development Unit

11 Rennie House

41 Margaret Mncadi Avenue

DURBAN

4001

Contact Person: Denny Thaver

031 – 311 4037

PREPARED BY:

Strategic Planning Resources

Postnet Suite 75

Private Bag X03

WESTVILLE

3630

Contact Persons: Tindall Kruger /

Dennis Nkosi

031 – 262 7014

RIVER HORSE VALLEY BUSINESS ESTATE DRAFT 2: IMPACT ASSESSMENT

STRATPLAN

NOVEMBER 2012

i

ACKNOWLEDGEMENTS

This Impact Assessment was made possible through the guidance and support received from the

Project Steering Committee including:

Denny Thaver as Project Manager representing eThekwini Municipality Economic Development

Unit;

Brian Ive, Mike Deighton, Musa Shabane and Cyril Gwala of Tongaat Hulett Developments; and

Trevor Pierce-Jones and Bruce Macaulay of the River Horse Valley Business Estate Management

Association (RHVBEMA).

Specific support to be acknowledged include:

The making available of all previous research reports available to the various institutions;

General information relating to the development made available by the various institutions;

The supply of high quality digital images by RHVBEMA;

Facilitating contact with key stakeholders for the pilot surveys by the RHVBEMA;

Making available a comprehensive database of properties and companies by the RHVBEMA; and

The commenting of the various institutions on progress reports, questionnaires and approaches.

The StratPlan Team

Tindall Kruger, Dennis Nkosi and Thola Sibiya

November 2012


STRATPLAN

NOVEMBER 2012

ii

EXECUTIVE SUMMARY

BACKGROUND

The objectives of the study were firstly to confirm the impact to date of the River Horse Valley

Business Estate in terms of the local economy, employment and investment and, secondly, to

provide urban management decision-makers with a better understanding of what can be done to

further support the growth of businesses, employment and opportunities in River Horse Valley.

The assessment was specifically undertaken with a view to establishing whether the eThekwini

Municipality as the joint venture partner of Tongaat Hulett achieved it’s intended objectives through

the development. As a yardstick for measuring this achievement , it is noted that the Effingham

Development Joint Venture has spent R215.7 million to date on the installation of infrastructure,

including roads, services and platforms, creating serviced saleable sites to sell. The eThekwini

Municipality is roughly a two-thirds partner in the Joint Venture (pers com Joint Venture).

EThekwini has also spent R300 million on the construction of Queen Nandi Drive, however, this road

was viewed as essential infrastructure serving the larger region and was not constructed with the

view to provide access to the RHVBE. The proposed RHVBE development rather supported the

motivation for providing this strategic infrastructure linking major residential and business

townships, restructuring the colonial and apartheid urban landscape.

CORE FINDINGS

Based on the survey of 90 of a total of 173 companies and the collection of other relevant

information the core findings of the study related to:

Development cost: A total of R215.7 million, of which eThekwini made roughly a two-thirds

contribution, was spent on establishing and servicing the Estate (this excludes top structure

development). To place this in context this investment must be compared to public sector spending

on the uShaka Marine World (R735 million), the Durban ICC (R900 million in the 1990s), the Moses

Mabhida Stadium (R3.4 billion) and the King Shaka International Airport (R7.8 billion). In

comparison the public sector investment in RHVBE has thus been relatively small.

Capital investment: From calculations based on the 2012 eThekwini Municipality Valuation Roll of

the RHVBE the market value of properties in the RHVBE was estimated at R3.2 billion. Through the

survey further investment of R1.2 billion over the next five years could be confirmed. This is viewed

as a conservative estimate of the actual capital investment as it is anticipated that market value for

industrial properties will be well below the actual investment value. Again, to place this in context,

the construction of 4 000 middle income houses (each valued at R800 000) will equate this

investment value of R3.2billion. This capital investment of R3.2 billion should then also be

considered in the context of the R3.4 billion Moses Mabhida Stadium and the R7.8 billion King Shaka

International Airport.


STRATPLAN

NOVEMBER 2012

iii

Municipal Rates Contribution: The rates contribution of properties in RHVBE is estimated to be

R83 million per annum, or more than a third of the actual investment cost of R215.7 million. This will

equate to the rates contribution of 6 000 homes valued at R1.5 million each, or 11 500 R800 000

homes.

Employment: Based on the survey findings it was estimated that in excess of 17 000 people are

employed in RHVBE. The permanent workforce is estimated to be 12 629 (of which 4 249 are new

jobs) augmented by a contract workforce of 4 446 people (including employees of contractors and

contract staff). Estimates from the early 2000’s placed employment in Isipingo / Prospecton at 21

000 people, Springfield Park at 12 000 and Phoenix Industrial at 4 500. The Durban ICC is suggested

to create 3 376 jobs directly related to the core activities of the Centre. Further to this, the majority

of employees employed in RHVBE are drawn from the general area in which it is located, i.e. INK

(32%) and Durban North (17%), with Reservoir Hills, Newlands and Avoca Hills making a combined

12% contribution to employment.

OTHER BASIC FACTS

A number of key facts confirmed through the assessment are highlighted:

A total of 173 companies were confirmed to be currently active in the RHVBE (52% or 90 were

interviewed for this assessment). With new developments this number is continually increasing.

49% of companies were classified as being part of the wholesale and retail sector, 21%

manufacturing sector related and 20% belonging to the transport, storage and communication

sector.

Three “clusters” feature prominently in the Estate viz. wholesale trade in machinery, equipment

and supplies (14% of companies), other retail trade in specialised goods (16%); and post and

associated courier services (10%).

The majority of facilities in RHVBE are branches representing larger regional, national and

international business concerns, however, there is a relatively high proportion of head offices

(28%) or independent units (15%) also located within the Estate.

Sixty one percent of companies interviewed indicated that their establishment in RHVBE were

as a result of a relocation process, with a further 22% suggesting they were outgrowing their

premises at the time of relocation, and 7% percent being newly established.

A high 19% of the companies accommodated in RHVBE were established after 2001 and can

therefore be viewed as new or emerging companies. A further 32% of companies were

established between 1991 and 2000, and 39% before 1990.

Nearly 50% of businesses were drawn from areas in close proximity to RHVBE with 24% of

businesses previously located in Springfield Park and 21% located in Durban North.

The Estate is nationally and globally linked with a number of companies being involved in export

and import activities.

From the above it is concluded that the RHVBE, within a short period of time, has established itself

as an integral part of the economic fabric of the eThekwini Municipality.


STRATPLAN

NOVEMBER 2012

iv

CONSIDERING THE IMPACT

This current assessment and previous studies considered the impact of the RHVBE from a number of

perspectives. Each of these perspectives are briefly reflected on below.

Attracting / retaining major companies: The Estate, although not successful in facilitating new

company formation, has succeeded in providing a number of major companies with an alternative

location to consolidate and/or expand its eThekwini operations. Importantly, it also provided

companies with an opportunity to improve operational efficiencies specifically from a logistics

perspective and their corporate image. The move of companies from older industrial and business

estates also established opportunities for the establishment and growth of new and existing

businesses in those areas. The fact that industrial property vacancy rates in eThekwini has

remained low in the recessionary climate suggests that the need for such properties has been

substantial.

Creating and retaining jobs: It was illustrated that the Estate offers in the region of 17 000

employment opportunities, making it one of the major employment nodes in eThekwini. At least 4

200 (approximately 34%) of these jobs were new jobs created as a result of the establishment of the

Estate. The employment created through the construction phase should also be considered in this

regard and is discussed in substantial detail by McCarthy (2009).

Boosting municipal rates: It is estimated that the Estate currently generates annual rates

amounting to R83.5 million. This will increase as the development of sites in the Estate continues.

Facilitating investment: The estimated combined market value of properties in the Estate, based

on the 2012 eThekwini Valuation Roll, is currently set at R3.2 billion. Further investment in the

Estate of R1.2 billion by various industries have been confirmed through the assessment. This

suggests a gearing ratio of nearly 1:15 if the investment of the Joint Venture in terms of

infrastructure is considered against this overall investment (land and management costs are

excluded from this calculation).

Enhancing the urban environment: Through the planning and the various initiatives of the

Management Association, former sugar cane fields are now being rehabilitated and integrated into

the urban environment. Key contributions of the Estate in this regard then includes (1) the

establishment of an aesthetically acceptable business park, including a number of state of the art

facilities with architectural merit, (2) wetland rehabilitation and (3) a range of associated initiatives

as reflected on in reports by the RHVBEMA.

Enhancing urban infrastructure: The development of the Estate not only supports the

densification strategies of eThekwini, but also facilitated the development of critical urban

infrastructure, specifically the construction of Queen Nandi Drive and the access onto the N2 both

contributing to the restructuring of the colonial and apartheid urban landscape by providing

improved linkages between residential and business townships. A contribution is also made to the

more efficient utilisation of existing infrastructure.


STRATPLAN

NOVEMBER 2012

v

POSSIBLE NEGATIVE IMPACTS OF THE ESTATE

The above, mostly positive impacts, should be considered against the possible negative impacts. To

date the only potential negative impact that could be identified through this assessment is the

impact of this development on neighbouring and other competing business estate developments

brought about by the relocation of businesses to the newer River Horse Valley Business Estate.

From the assessment it is evident that such relocations have taken place. However, in light of low

industrial vacancy rates in eThekwini the impact of this on those areas are not viewed as substantial.

Such relocations also potentially provide quality space for smaller and emerging businesses to grow

into. This impact could be further investigated if high vacancies rates from neighbouring estates can

be confirmed.

ISSUES TO BE ADDRESSED

A number of issues identified through this and previous assessments should continue to be

addressed through the ongoing activities of the Management Association. These include:

Safety and security: This is an ongoing focus of the Management Association and there may be

a need to better understand the concerns of businesses in this regard. It is, however, noted that

levels of reported crime is low and that levels of surveillance is higher than in most similar

development areas.

Transport issues: Various transport issues have been highlighted including congestion on roads,

the lack of coordinated taxi transport and traffic management in general. Most of these issues

are currently being addressed through various initiatives, but with the extent of development in

the area, the strong logistics function and the public nature of Queen Nandi Drive specifically

this aspect will always have to be managed.

Access to facilities: Access to facilities, specifically for staff, has been a key issue to be

addressed highlighted in all previous assessments. To some extent this will be addressed with

the development of two sites by Engen, who will be providing convenience and fast food

outlets, which is currently in planning. Further attention should, however, be afforded towards

planning for this component of the Estate. Considering the number of people employed in the

development and the location of the development further retail development in the area may

present an opportunity.

Corporate social responsibility: It has been confirmed that the current impact of corporate

social responsibility programmes on neighbouring communities are limited. Based on the

responses of companies it is suggested that the potential for a coordinated social responsibility

programme managed by the Association should be considered.


STRATPLAN

NOVEMBER 2012

vi

CONCLUSION

The assessment has confirmed the significant positive impact of the River Horse Valley Business

Estate on investment, job creation, rates generation and urban development. It is suggested that

other investment in strategic infrastructure made by the eThekwini Municipality should also be

evaluated in terms of the identified criteria and that a comprehensive understanding be developed

on what strategies will best support the efforts of national government to create 11 million jobs by

2030. The criteria applied in the case of the River Horse Valley Business Impact Assessment can also

be applied in assessing other investments in eThekwini. This will assist decision-makers in

comparing various investment options.

The criteria to be considered must include the contribution of a development / investment towards:

Attracting / retaining major companies;

Creating and retaining jobs;

Boosting municipal rates;

Facilitating investment;

Enhancing the urban environment; and

Enhancing urban infrastructure.


STRATPLAN

NOVEMBER 2012

vii

TABLE OF CONTENTS

1. INTRODUCTION .......................................................................................................... 1

1.1. PURPOSE OF REPORT ....................................................................................................... 1

1.2. BACKGROUND TO THE RHVBE DEVELOPMENT ............................................................... 1

1.3. THE APPROACH ................................................................................................................ 2

2. FINDINGS FROM PREVIOUS ASSESSMENTS ................................................................ 4

2.1. INTRODUCTION ................................................................................................................ 4

2.2. BASELINE STUDY 1: HOUGHTON (2005) ......................................................................... 4

2.3. BASELINE STUDY 2: FAKISANDLA CONSULTING ASSESSMENT (2007) .......................... 5

2.4. SOCIO-ECONOMIC IMPACTS OF RIVER HORSE VALLEY: JEFF MCCARTHY (2009) ......... 6

2.5. HOUGHTON ON DURBAN PPPS (2010) ............................................................................ 6

2.6. SYNOPSIS .......................................................................................................................... 7

3. THE CONTEXT: INDUSTRIAL PROPERTY IN ETHEKWINI .............................................. 8

3.1. RIVERHORSE VALLEY IN THE ETHEKWINI CONTEXT ...................................................... 8

3.2. FUTURE INDUSTRIAL DEVELOPMENT IN ETHEKWINI ..................................................... 8

3.3. TRENDS IN THE INDUSTRIAL PROPERTY SECTOR ......................................................... 10

4. RHVBE COMPANIES CLASSIFICATION ........................................................................ 11

4.1. INTRODUCTION ............................................................................................................... 11

4.2. COMPANY IN KEY ECONOMIC SECTORS ........................................................................ 11

4.3. A MORE DETAILED CLASSIFICATION OF RHVBE BUSINESSES ...................................... 12

4.4. SYNOPSIS OF BUSINESS TYPES IN THE RHVBE .............................................................. 16

5. ABOUT THE COMPANIES IN RHVBE ............................................................................ 17

5.1. INTRODUCTION ............................................................................................................... 17

5.2. COMPANY TURNOVER .................................................................................................... 17

5.3. LINKAGES OF RHVBE BUSINESS FACILITIES WITH COMPANIES .................................... 18

5.4. NEW COMPANIES VS RELOCATION ................................................................................20

5.5. AGE OF COMPANIES AND FACILITIES .............................................................................20

5.6. SELECTION OF RHVBE AS A LOCATION ..........................................................................22

6. REGIONAL AND GLOBAL LINKAGES ........................................................................... 24

6.1. INTRODUCTION ...............................................................................................................24

6.2. SPATIAL LINKAGES ..........................................................................................................24

6.3. INFRASTRUCTURE LINKAGES ......................................................................................... 25

6.4. EXPORTS .......................................................................................................................... 25

6.5. IMPORTS ......................................................................................................................... 26

6.6. SYNOPSIS ON LINKAGES ................................................................................................ 27


STRATPLAN

NOVEMBER 2012

viii

7. EMPLOYMENT IN THE RHVBE .................................................................................... 28

7.1. INTRODUCTION ...............................................................................................................28

7.2. CONTRIBUTION TO EMPLOYMENT BY RHVBE COMPANIES .........................................28

7.3. THE CONTRIBUTION OF CONTRACTERS TO EMPLOYMENT ......................................... 30

7.4. NEW JOBS ........................................................................................................................ 31

7.5. EMPOWERMENT IN RHVBE ............................................................................................. 32

7.6. SKILL LEVELS EMPLOYED IN THE RHVBE ....................................................................... 33

7.7. FUTURE EMPLOYMENT IN THE RHVBE ........................................................................... 35

7.8. PLACE OF RESIDENCE OF EMPLOYEES .......................................................................... 35

7.9. SYNOPSIS ON FINDINGS RELATING TO EMPLOYMENT ................................................ 36

8. THE FACILITIES OF RHVBE COMPANIES ...................................................................... 38

8.1. INTRODUCTION ............................................................................................................... 38

8.2. OWNERSHIP OF PROPERTIES ......................................................................................... 38

8.3. SPACE OCCUPIED ............................................................................................................ 39

8.4. CAPITAL EXPANSION PLANS ..........................................................................................40

9. URBAN MANAGEMENT CONSIDERATIONS ................................................................. 41

9.1. INTRODUCTION ............................................................................................................... 41

9.2. THE ROLE OF THE MANAGEMENT ASSOCIATION ......................................................... 41

9.3. URBAN MANAGEMENT ISSUES .......................................................................................42

9.4. TRANSPORT RELATED ISSUES ....................................................................................... 44

9.5. CORPORATE SOCIAL RESPONSIBILITY .......................................................................... 44

9.6. SYNOPSIS OF URBAN MANAGEMENT ISSUES .............................................................. 46

10. AN ANALYSIS OF RATES CONTRIBUTIONS ................................................................. 47

10.1. INTRODUCTION ............................................................................................................... 47

10.2. RHVBE RATES INFORMATION ..................................................................................... 47

10.3. CONSIDERING THE IMPLICATIONS ................................................................................ 48

11. CONCLUDING COMMENTS: THE IMPACT OF THE RHVBE ............................................ 49

11.1. INTRODUCTION .............................................................................................................. 49

11.2. CORE FINDINGS .............................................................................................................. 49

11.3. OTHER BASIC FACTS ....................................................................................................... 50

11.4. CONSIDERING THE IMPACT ............................................................................................ 51

11.5. POSSIBLE NEGATIVE IMPACTS OF THE ESTATE ............................................................ 52

11.6. ISSUES TO BE ADDRESSED ............................................................................................. 52

11.7. CONCLUSION ................................................................................................................... 53

Annexure A: Company Questionnaire

Annexure B: Listing of Businesses in the River Horse Valley Business Estate and Interview Status

Annexure C: Activities of the River Horse Valley Business Estate Management Association


STRATPLAN

NOVEMBER 2012

ix

LIST OF MAPS: MAP 3.1: EXISTING AND (PHASING) PLANNED INDUSTRIAL AREAS ............................................................................... 9

MAP 3.2: PROPOSED INDUSTRIAL DEVELOPMENT FOCUS AREAS............................................................................... 10

LIST OF TABLES: TABLE 3.1: OVERVIEW OF INDUSTRIAL LAND IN ETHEKWINI ......................................................................................... 8

TABLE 4.1: SIC LEVEL 1 DISTRIBUTION OF RHVBE COMPANIES INTERVIEWED ............................................................ 12

TABLE 4.2: SIC LEVEL 2 DISTRIBUTION OF RHVBE COMPANIES INTERVIEWED ........................................................... 13

TABLE 4.3: SIC LEVEL 3 DETAILED LISTING OF TYPE (SIC 3 LEVEL) OF COMPANIES INTERVIEWED ............................. 14

TABLE 5.1: TURNOVER CATEGORIES OF RHVBE COMPANIES .......................................................................................17

TABLE 5.2: HEAD OFFICE LOCATION OF RHVBE COMPANIES ....................................................................................... 19

TABLE 7.1: SECTORAL DISTRIBUTION OF EMPLOYMENT IN RHVBE (COMPARED WITH SECTORAL DISTRIBUTION OF

COMPANIES) ................................................................................................................................................................... 29

TABLE 7.2: CONTRACT WORKERS EMPLOYED OVER AND ABOVE FULL-TIME STAFF.................................................. 30

TABLE 7.3: NEW JOBS AS A PERCENTAGE OF TOTAL JOBS........................................................................................... 31

TABLE 7.4: DISTRIBUTION OF NEW JOBS CREATED PER SECTOR ................................................................................. 31

TABLE 7.5: EXTENT OF HDI EMPLOYED IN DIFFERENT SECTORS (50 COMPANIES) ...................................................... 32

TABLE 7.6: EXPERIENCE OF MANUFACTURING WORKERS WHEN RECRUITING – GDMA, 2002/2003 ........................... 34

TABLE 7.7: ANTICIPATED FUTURE EMPLOYMENT GROWTH ......................................................................................... 35

TABLE 7.8: PLACE OF RESIDENCE OF EMPLOYEES ....................................................................................................... 35

TABLE 7.9: THE SPREAD OF EMPLOYMENT ACROSS ETHEKWINI BY TYPE AND NUMBER OF JOBS, 2001 ................... 36

TABLE 9.1: ISSUES TO BE FOCUSSED ON BY THE RHVBE MANAGEMENT ASSOCIATION ............................................ 42

TABLE 10.1: SUMMARY OF ANNUAL RATES PAYABLE FOR RHVBE PROPERTIES ......................................................... 47

LIST OF DIAGRAMS: DIAGRAM 4.1: SIC LEVEL 1 DISTRIBUTION OF RHVBE COMPANIES INTERVIEWED (TOTAL OF 90) .............................. 12

DIAGRAM 5.1: TURNOVER CATEGORIES OF RHVBE COMPANIES ................................................................................. 18

DIAGRAM 5.2: HEAD OFFICE OR BRANCH LOCATED IN RHVBE .................................................................................... 19

DIAGRAM 5.3: RHVBE MOVE: RELOCATION, EXPANSION OR NEW COMPANY ............................................................ 20

DIAGRAM 5.4: AGE OF COMPANIES LOCATED IN RHVBE .............................................................................................. 21

DIAGRAM 5.5: YEAR WHEN COMPANIES ESTABLISHED IN RHVBE ............................................................................... 21

DIAGRAM 5.6: PRIMARY REASONS FOR LOCATING IN RHVBE ...................................................................................... 22

DIAGRAM 5.7: AREAS WHERE FIRMS RELOCATED FROM (TOTAL 66 FIRMS) ................................................................ 23

DIAGRAM 6.1: LOCATION OF MAJORITY OF CUSTOMERS OF RHVBE BUSINESSES ..................................................... 24

DIAGRAM 6.2: NUMBER OF MENTIONS OF CRITICAL LOGISTICS INFRASTRUCTURE ................................................... 25

DIAGRAM 6.3: EXTENT OF EXPORTS BY RHVBE BUSINESSES ....................................................................................... 26

DIAGRAM 6.4: EXTENT OF IMPORTS BY RHVBE BUSINESSES ....................................................................................... 26

DIAGRAM 7.1: SECTORAL DISTRIBUTION OF EMPLOYMENT IN RHVBE (6 125 WORKERS) ........................................... 30

DIAGRAM 7.2: % DISTRIBUTION OF HDI AND NON-HDI STAFF IN SECTORS (50 COMPANIES) ..................................... 32

DIAGRAM 7.3: EMPLOYMENT CATEGORY PER SECTOR IN RHVBE ................................................................................ 33

DIAGRAM 7.4: DISTRIBUTION OF HDI EMPLOYMENT PER CATEGORY AND SECTOR ................................................... 34

DIAGRAM 8.1: COMPANIES THAT OWN OR LEASE FACILITIES...................................................................................... 38

DIAGRAM 8.2: OWNERSHIP OF FACILITIES IN DIFFERENT TURNOVER CATEGORIES ................................................... 39

DIAGRAM 8.3: APPROXIMATE DISTRIBUTION OF BUILDING SPACE (IN M2) .................................................................. 40

DIAGRAM 9.1: RESPONDENTS KNOWING WHERE RHVBE MANAGEMENT OFFICES ARE LOCATED ........................... 41

DIAGRAM 9.2: RATING OF URBAN MANAGEMENT ISSUES BASED ON PERCEPTION OF RESPONSDENTS ................. 43

DIAGRAM 9.3: PERCEIVED TRAFFIC MANAGEMENT ISSUES ........................................................................................ 44

DIAGRAM 9.4: COMPANIES WITH CORPORATE SOCIAL RESPONSIBILITY PROGRAMMES IN PLACE........................... 45

DIAGRAM 9.5: COMPANIES INTERESTED IN PARTICIPATING IN RHBVE FOCUSSED CORPORATE SOCIAL

RESPONSIBILITY PROGRAMMES .................................................................................................................................... 45


STRATPLAN

NOVEMBER 2012

1

1. INTRODUCTION

1.1. PURPOSE OF REPORT

Following the successful sale of all properties in the business estate the eThekwini Municipality

commissioned this study to determine the socio-economic impact of the River Horse Valley

Business Estate (RHVBE) on the immediate site and surrounds and the eThekwini economy at large.

This study was being undertaken in partnership with Tongaat Hulett Developments and the RHVBE

Management Association.

The objectives for the study were firstly to confirm the impact to date of the RHVBE in terms of the

local economy, employment and investment and, secondly, to provide urban management

decision-makers with a better understanding of what can be done to further support the growth of

businesses, employment and opportunities in River Horse Valley.

This report reflects on the findings of the impact assessment.

1.2. BACKGROUND TO THE RHVBE DEVELOPMENT

The Effingham Development Joint Venture between the eThekwini Municipality and Tongaat

Hulett set out in 2000 to establish the RHVBE. The Estate is now well established and thriving with

all 100 properties in the development sold and nearly 180 businesses established in the area. This

development is unique and trendsetting in a number of ways. With construction costs of R1.6 billion

it is one of the biggest successful public-private sector initiatives of its kind in KwaZulu-Natal.

Although not a gated or security estate it has introduced and embraced the concept of a

management association for the area with the RHVBEMA now in operation for 9 years, continuing

to set new standards in urban management. The manner in which sustainability issues are being

addressed and the positive contribution being made to the green environment of eThekwini further

sets this development apart.

Other successes include the work that commenced recently to upgrade Queen Nandi Drive and

various other initiatives of the RHVBEMA, the forthcoming rehabilitation of 41 hectares of wetland,

a R750 000 indigenous tree planting programme, addressing public transport issues and the general

management of the area by the RHVBEMA. The estate is setting new benchmarks in the

development and management of business estates. It has received numerous awards from the

property and business communities.

As indicated, the beginnings of RHVBE are traced to 2000. The process got underway with the

rezoning of low-yielding agricultural land to Special Zone 64 providing for industrial, commercial,

mixed use and residential uses. The Joint Venture was premised on an original plan that assessed

the site according to the following criteria (Moreland 2002, as in Fakisandla 2007):


STRATPLAN

NOVEMBER 2012

2

Indications of long term financial viability;

Support for investment projects that would improve environmental performance, based on a

number of commitments to improving the environment in and around the development, including

the protection of the river and the wetland;

Conformity to development policies and land use planning strategies, whereby under-utilized land

is put to more effective use in the interests of development; employment opportunities are brought

closer to job seekers; and conformity to the IDP for eThekwini;

Support for the development of industrial areas for strategic economic advantages, i.e. strategic

location with regard to the DMA; facilitation of economic growth of the sub region and arterial

access in all directions to interface with other business nodes; and the expansion of the rates and

services charge base for the city;

Support for projects that are internationally cost competitive;

Support for enterprises that offer direct and indirect employment opportunities, with an anticipated

3500 jobs created in the building phase and 13500 jobs in the post building phase; and that bring

job opportunities closer to the Inanda, Ntuzuma, KwaMashu ( INK) area where unemployment

levels are high;

Support for opportunities to develop linkages – upstream and downstream by providing a range of

opportunities for entrepreneurship in the sub region; as well as linkages geographically and by

virtue of mixed usage; and

Support for opportunities for growth of small to medium enterprises by providing facilities based on

requirements ranging from 1.2ha to 4 ha in a mixed use RHVBE that is well-placed and well-

resourced.

1.3. THE APPROACH

The overall stated objective for the study is to confirm the impact of the River Horse Valley Business

Estate in terms of:

The local economy;

Employment; and

Investment.

The approach to this impact assessment was based on the discussions with stakeholders at the

meeting held at the offices of Tongaat Hulett on 14 June 2012. The meeting was attended by

representatives of the Economic Development Unit of eThekwini, Tongaat Hulett, the River Horse

Valley Business Management Association (RHVBMA) and the Project Team (StratPlan).

The approach included a number of broad actions, viz.

Preparation, which included meetings with stakeholders, the finalisation of the process plan;

Developing a RHVBE business database;

Finalising the questionnaire;

Conduct pilot questionnaire;

Collect other relevant and business data;

Conduct surveys / interviews; and

Data analysis and report writing.


STRATPLAN

NOVEMBER 2012

3

The steps are expanded on below.

Preparation: A Technical Committee including representatives of eThekwini Municipality,

Tongaat Hulett, RHVBE Management Association and the Project Team was established and

guided the preparation phase of the study.

Collect other relevant and business data: Previous studies relating to the RHVBE was collected

and these informed the development of the questionnaire and the approach. Information

relating to the rates and other general information were also gathered in the process.

Developing a RHVBE business database: The first challenge was to develop / obtain a database

of all businesses in the Estate. The Management Association their current distribution list

available and this was used as the basis. Of the businesses identified some 16 businesses were

confirmed to have either left River Horse Valley recently or to not be located in the Estate, but

delivering a property management services in the area. A total of 173 businesses were therefore

targeted in the survey process.

Finalising the questionnaire: Through engagement with the Technical Committee a draft

questionnaire was compile. The questionnaire was piloted with three companies in the RHVBE

and adjusted based on the outcome of the pilot survey. The final questionnaire is attached as

Annexure A.

Conduct surveys / interviews: All 173 identified companies were targeted in the survey process.

The survey process was undertaken over an extended period from mid-July to mid-September,

as opposed to the anticipated survey process of one month. All companies on the database

were contacted through both bulk emails and personal telephonic follow ups. Ninety

companies engaged in the survey process either through direct interaction, telephonic

interviews or by completing the questionnaires internally. An alphabetical list of the companies

targeted and the interview status is attached as Annexure B.

Data analysis and report writing: The information collected through the questionnaires was

captured in a database and quality of information was checked. The information was analysed

and the report prepared.


STRATPLAN

NOVEMBER 2012

4

2. FINDINGS FROM PREVIOUS ASSESSMENTS

2.1. INTRODUCTION

Before engaging with the findings of the current survey process it is worthwhile to reflect on some

of the key findings emanating from previous assessments undertaken of the general impact of the

Estate on the local and regional economic landscape. Four studies / reports were identified:

Houghton J. 2005. Baseline Study: River horse Valley Business Estate.

Fakisandla Consulting, 2007. River Horse Valley Business Estate: An Updated Baseline Study.

McCarthy J. 2009. Socio-economic Impacts of River horse Valley.

Houghton J. 2010. Negotiating the Global and the Local: Evaluating Development Through

Public-Private Partnerships in Durban, South Africa.

Basic findings from these reports are shared below. It should be noted that both the baseline

studies (Houghton 2005, Fakisandla 2007) included primary research, but that at the time of the

surveys being conducted the number of companies in the Estate was limited. The 2005 study by

Houghton surveyed 13 companies. The 2007 study acknowledges some 78 companies and

interviewed 21. Neither study did a full classification of businesses interviewed. The current study

expanded specifically on this aspect of development in the Estate.

2.2. BASELINE STUDY 1: HOUGHTON (2005)

Key findings from the study conducted by Houghton (2005) included:

The majority of companies are well established and have relocated to the Estate from elsewhere in

Durban.

Most companies are branches of national or multi-national companies.

The economic linkages extending from the few businesses already located in RHV are expansive

and point towards the formation of stronger and more extensive economic networks from within

the Estate as the area continues to develop.

Few linkages exist between businesses within RHV, although this can be attributed to the small

number of companies and to the current lack of intersection between products and services offered

and required by companies.

Although there is much spatial variation in the location of residential areas across the urban area,

there is evidence of a pattern of residential clustering of employees in areas surrounding RHV.

Negative aspects of RHV effect employees directly rather than impacting on companies.

Public transport services and a lack of food and shopping outlets (including the petroports) are key

problems within the estate. In this case it is important to recognize that the goals of the

development should not be merely about providing employment but should address the quality of

employment and the need to facilitate a good working environment, for example difficult access to

the site drains the resources of employees and creates frustration and even endangerment. This in


STRATPLAN

NOVEMBER 2012

5

turn feeds back into worker’s benefits, and their satisfaction and productivity which can become

detrimental to employers.

Overall businesses have found the area to be highly satisfactory. Key benefits of the estate for

businesses were found to be accessible to the highways, the opportunity to expand their facilities

on large, custom built sites and the boosted image of the company through the positive image of

the developing area. On the part of employees, the quality of the environment in RHV was found to

be the greatest benefit of the area.

2.3. BASELINE STUDY 2: FAKISANDLA CONSULTING ASSESSMENT (2007)

The 2007, the Fakisandla report, commissioned by Tongaat-Hulett, concluded amongst other

things the following:

The commercial sector is the “... best-represented sector” within the estate;

A number of companies now located in the estate have consolidated local branches or

amalgamated different divisions;

In 2007 it was estimated that there were 4 000 employees at River horse Valley with 85% being

permanent;

The perception of the development by neighbouring communities was found to be “neutral or

negative” as a result of issues such as noise pollution, visual impact and damage during the

construction period;

The positive aspects that were mentioned by people from neighbouring communities included

the potential rise in property values, increased security and the additional business to local

shops;

Other findings that emerged included:

o the lack of evidence that Black Economic Empowerment has been addressed with

regard to land ownership, tenancy and business operation;

o the limited evidence that neighbouring communities benefitted; and

o the inadequacy of social responsibility programmes of companies.

Based on the findings of this assessment a number of recommendations were made. As a starting

point it was acknowledged that a Management Association has “the potential to play a pivotal role in

maintaining the reputation that River Horse Valley has as a well-managed, attractive and desirable

industrial estate”. Concerns were expressed by participants in that survey that the overall

management of the estate will deteriorate once Tongaat-Hulett withdraws from the Estate.

The three core recommendations that emerged from the assessment were that:

a Management Association could play a useful role in the facilitation of “a number of

improvements, including identifying and designing effective social responsibility programmes;

fostering internal linkages; assisting in the coordination of employment initiatives designed to

benefit local communities, and managing the unique environmental features of the place”.


STRATPLAN

NOVEMBER 2012

6

The provision of public amenities, including food outlets, banking facilities and petrol stations, as

well as leisure space and a clinic.

The potential for promoting SMME opportunities within River Horse Valley, again considering a

range of relevant opportunities, as well as the setting up of a private transport system consisting of

taxi and bus routes.

2.4. SOCIO-ECONOMIC IMPACTS OF RIVER HORSE VALLEY: JEFF MCCARTHY

(2009)

In 2009, Professor Jeff McCarthy, based on the 2007 baseline study, indicated that some 4000

permanent job opportunities have been established and that, when the estate reaches full capacity,

this could be as high as 10 000 permanent jobs. It was suggested that a significant portion of these

will be new jobs.

Other potential benefits for eThekwini was deemed to be:

Rates income in the region of R45 million per annum;

VAT raised during the construction phase;

Tax yields on wages and company profits;

Concludes that “...when viewed from the perspective of metropolitan citizens and ratepayers as a

whole, good social (e.g. jobs, enhanced metropolitan accessibility) and financial (e.g. rates and

taxes) returns have been received in relation to the public outlays”.

2.5. HOUGHTON ON DURBAN PPPS (2010)

Houghton (2010) suggests that the RHVBE was developed “…to contribute to meeting the overall

development goals of the eThekwini Municipal Area”. She lists these goals as including:

The strengthening of the urban economy (by encouraging private investment and economic

diversification);

The growth of employment opportunities, particularly amongst the previously disadvantaged;

Improving service delivery;

Reduce poverty; and

Uplift the quality of life of residents.

She concludes that based on her analysis “the present nature of the estate contributes minimally to

the achievement of these goals, particularly those related to social justice”.


STRATPLAN

NOVEMBER 2012

7

2.6. SYNOPSIS

All the studies comment positively on the contribution of the Estate in terms of strengthening the

economy, job creation and improvement of the urban environment. Houghton (2010) based on her

assessment of PPPs, however, believes that specifically the goals related to “social justice” have not

been achieved.

The baseline studies also make various recommendations of issues to be addressed:

The encouragement of SMMEs to locate in the area;

A greater focus on Black Economic Empowerment;

Providing accessible facilities for workers in the estate, e.g. shops, restaurants and

opportunities for leisure;

The setting up (Houghton 2005) and the strengthening (Fakisandla 2007) of the Business

Association.

The findings of the various assessments will be commented on in terms of the more detailed

findings of the current assessment.


STRATPLAN

NOVEMBER 2012

8

3. THE CONTEXT: INDUSTRIAL PROPERTY IN ETHEKWINI

3.1. RIVERHORSE VALLEY IN THE ETHEKWINI CONTEXT

The establishment of River Horse Valley Business Estate was initiated before 1994 and since then

the country has experienced two significant economic downturns, viz. in the early 2000s and the

late 2000s. The establishment of the estate was therefore a long term planning decision not

influenced by short term dynamics in the economy.

The establishment of River Horse Valley Business Estate was conceptualised out of recognition of

the significant demand for well-located land for industrial, logistics and business purposes in the

eThekwini Municipality. Other industrial nodes of note developed in the past two decades in

eThekwini included the Southgate Industrial Park, Mahogany Ridge and Springfield Park, all of

these located in central, southern and western parts of eThekwini, not relating to the major

development corridor to the north of Durban. River Horse Valley was intended to fill this gap.

EThekwini statistics on industrial land suggests that the contribution of industrial land to the north

of Durban is limited, this despite the strong anticipated growth in this corridor. This is reflected in

Table 3.1.

TABLE 3.1: OVERVIEW OF INDUSTRIAL LAND IN ETHEKWINI

AREA LAND

ZONED (HA)

LAND OCCUPIED

(HA)

% OF ZONED LAND

OCCUPIED (HA)

ZONED LAND

AVAILABLE (HA)

% OF LAND AVAILABLE

(HA)

% OF TOTAL ZONED

AREA AVAILABLE

South Durban Basin 1667.3 1541.2 92% 136.1 8% 8.4%

Inner West 1367 1111.8 81.30% 255.2 18.70% 15.8%

Outer West 1455.5 547 37.60% 908.5 62.40% 56.4%

Durban Central 1540.8 1540.5 99.99% 0.2 0.01% 0.0%

North 1045.6 733.9 70.20% 311.7 29.80% 19.3%

TOTALS

1611.7

100.0%

Source: eThekwini 2009

3.2. FUTURE INDUSTRIAL DEVELOPMENT IN ETHEKWINI

The Industrial Spatial Strategy (2009) of the eThekwini Municipality also places the River Horse

Valley Estate in the context of future anticipated industrial development. The distribution of

existing industrial areas and the phasing of proposed future industrial nodal development are

reflected in the Map below.


STRATPLAN

NOVEMBER 2012

9

MAP 3.1: EXISTING AND (PHASING) PLANNED INDUSTRIAL AREAS

Source: eThekwini Industrial Spatial Strategy 2009

It is evident from the above, firstly, that the bulk of industrial land in eThekwini is located to the

south and west of Durban, with Springfield Park, Phoenix Industrial and River Horse Valley making

up the bulk of the industrial land located to the north of Durban. However, a number of short,

medium and long term opportunities for industrial development are reflected on the above

eThekwini Industrial Spatial Strategy (2009). It is anticipated that in the longer term the

development of these industrial areas could further strengthen the position of the River Horse

Valley Business Estate.

As the status of the Industrial Spatial Strategy could not be confirmed, the above proposals and

phasing should be viewed as recommendations. In a similar fashion the map overleaf provides

recommendations on the proposed focus areas for future industrial development. The focus

proposed for the northern corridor, in which the RHVBE is located, being on logistics, light industrial

and warehousing.


STRATPLAN

NOVEMBER 2012

10

MAP 3.2: PROPOSED INDUSTRIAL DEVELOPMENT FOCUS AREAS

Source: eThekwini Industrial Spatial Strategy 2009

3.3. TRENDS IN THE INDUSTRIAL PROPERTY SECTOR

The general trend currently is for increasing vacancies in the industrial property sector in most

industrial conurbations in South Africa. Rode (2010) reports on this as follows: “The effects of softer

economic activity on the demand for industrial space to rent, and consequently market rentals, are

becoming strikingly evident.... evident .... is how industrial vacancies generally moved north in all of the

major industrial conurbations. As in the third quarter of 2009, vacancies stood at between 2 and 3,5 on

the Rode scale of 0 to 9. This equates to percentage vacancies of roughly between 3,5% and 8,2%”.

The 2011 Broll Property Report on the Durban industrial property sector, however, suggests that

“conditions in the Durban industrial market have remained largely unchanged in the last 12

months”. The Broll report, however, notes that there ”is still a gap for large high-quality

warehousing space”. It is, however, suggested that the prevailing economic conditions are

preventing developers from expanding their portfolios. Umhlanga and the industrial nodes to the

south of the city is viewed as the most popular industrial nodes at present. It is further noted that

the projected economic growth around the King Shaka Airport has not materialised, and this is

attributed to the downturn in global markets and the subsequent knock-on effect this has had on

exports.


STRATPLAN

NOVEMBER 2012

11

4. RHVBE COMPANIES CLASSIFICATION

4.1. INTRODUCTION

A 2002 presentation by the RHVBE project partners, Tongaat Hulett and eThekwini, suggests the

following distribution of land uses in the then anticipated 167 ha development of the River Horse

Valley Business Estate:

Industrial - 97ha

Mixed use - 26 ha

Direct Access Service Centre - 4ha

Residential - 40ha

The presentation further identifies permissible land uses as being “retail public, retail semi public,

office, high-tech industry, light service industry, warehousing, medical and residential which is

aimed specifically at the small to medium industry”.

This then provides the context for considering the nature of the businesses that settled in the

RHVBE development area.

4.2. COMPANY IN KEY ECONOMIC SECTORS

A total of 173 active companies were confirmed in the RHVBE and 52%, a total of 90, of the

confirmed businesses participated in the survey. As part of the survey companies were requested

to indicate the products or services offered. The information on products and services was used as

a basis for classifying the companies in terms of the Standard Industrial Classification (SIC Codes) to

a 3-digit level. The diagrams and tables that follow present an analysis of companies in the RHBVE

based on this standard industrial classification. A more detailed listing of companies interviewed is

presented in Annexure B.

Diagram 4.1 and Table 4.1 overleaf reflects on the distribution of companies based on the 1 digit SIC

classification. The diagram and table reflect that close to 50% of the businesses in the RHVBE are

classified as being engaged in the wholesale and retail trade category. Twenty one percent are

manufacturing orientated and a further 20% can be categorised as transport, storage and

communication businesses. The other 10% of businesses offer financial or business services,

community, social and personal services, and construction services.


STRATPLAN

NOVEMBER 2012

12

DIAGRAM 4.1: SIC LEVEL 1 DISTRIBUTION OF RHVBE COMPANIES INTERVIEWED (TOTAL OF 90)

TABLE 4.1: SIC LEVEL 1 DISTRIBUTION OF RHVBE COMPANIES INTERVIEWED

SECTOR COMPANIES

INTERVIEWED

% OF TOTAL

INTERVIEWED

Wholesale and Retail Trade; Repair of various; Hotels and Restaurants 44 49%

Manufacturing 19 21%

Transport, Storage and Communication 18 20%

Financial and Other Business Services 6 7%

Community, Social and Personal Services 2 2%

Construction 1 1%

TOTAL 90 100%

4.3. A MORE DETAILED CLASSIFICATION OF RHVBE BUSINESSES

Table 4.2 and 4.3 present the categorisation of RHVBE businesses on a SIC level 2 and 3

categorisation. Table 4.2 is general in nature and only provides a basic sense of the distribution of

companies within the main economic sectors. However, from Table 4.3 presenting the SIC level 3

categorisation, the clustering of specific categories of companies become clearly evident.


STRATPLAN

NOVEMBER 2012

13

TABLE 4.2: SIC LEVEL 2 DISTRIBUTION OF RHVBE COMPANIES INTERVIEWED

SECTOR COMPANIES

INTERVIEWED % OF TOTAL

WHOLESALE AND RETAIL TRADE; REPAIR OF VARIOUS; HOTELS

AND RESTAURANTS 44

Wholesale Trade and Commission Trade, Except of Motor Vehicles and

Motor Cycles 22 24%

Retail Trade 14 16%

Sale, maintenance and repair of motor vehicles and motor cycles; retail

trade in automotive fuels 8 9%

MANUFACTURING 19

Manufacture of Basic Metals etc 6 7%

Manufacture of Food Products, Beverages and Tobacco Products 4 4%

Manufacture of Coke, Refined Petroleum Products and Nuclear Fuel;

Manufacture of Chemicals and Chemical Products; Manufacture of

Rubber and Plastic Products

3 3%

Manufacture of Wood and Products of Wood etc 2 2%

Manufacture of Various Products 2 2%

Manufacture of Transport Equipment 1 1%

Manufacture of Textiles, Clothing and Leather Goods 1 1%

TRANSPORT, STORAGE AND COMMUNICATION 18

Post and Telecommunications 13 14%

Land Transport; Transport via Pipelines 3 3%

Supporting and Auxiliary Transport Activities 2 2%

FINANCIAL AND OTHER BUSINESS SERVICES 6

Other Business Activities 4 4%

Real Estate Activities 1 1%

Computer and Related Activities 1 1%

COMMUNITY, SOCIAL AND PERSONAL SERVICES 2

Health and Social Work 1 1%

Education 1 1%

CONSTRUCTION 1

Construction 1 1%

TOTAL 90 100%

The above illustrates that both wholesale and retail trade are prominent business categories in the

RHVBE. A range of manufacturing sector activities is also located in the RHVBE and post and

telecommunications is starting to emerge as a sector. Table 4.3 below unpacks this in more detail.


STRATPLAN

NOVEMBER 2012

14

TABLE 4.3: SIC LEVEL 3 DETAILED LISTING OF TYPE (SIC 3 LEVEL) OF COMPANIES INTERVIEWED

SECTOR NUMBER OF

COMPANIES % OF TOTAL

WHOLESALE TRADE AND COMMISSION TRADE, EXCEPT OF MOTOR

VEHICLES AND MOTOR CYCLES 22

Wholesale trade in machinery, equipment and supplies 13 14%

Wholesale of non-agricultural intermediate products, waste and scrap 4 4%

Wholesale of household goods 2 2%

Wholesale of Other Household Goods 2 2%

Wholesale Trade on a Fee or Contract Basis or Commission Basis 1 1%

RETAIL TRADE 14

Other Retail Trade in New Goods in Specialised Stores 14 16%

POST AND TELECOMMUNICATIONS 13

Post and Associated Courier Activities 9 10%

Telecommunications 4 4%

SALE, MAINTENANCE AND REPAIR OF MOTOR VEHICLES AND

MOTOR CYCLES; RETAIL TRADE IN AUTOMOTIVE FUELS 8

Sale of Motor Vehicle Parts and Accessories 3 3%

Maintenance and Repair of Motor Vehicles 3 3%

Sale of Motor Vehicles 1 1%

Retail Sale of Automotive Fuel 1 1%

MANUFACTURE OF BASIC METALS ETC 6

Manufacture of Basic Iron and Steel 3 3%

Manufacture of General Purpose Machinery 2 2%

Manufacture of Other Fabricated Metal Products; Metalwork Service

Activities 1 1%

OTHER BUSINESS ACTIVITIES 4

Advertising 3 3%

Business activities nec 1 1%

MANUFACTURE OF FOOD PRODUCTS, BEVERAGES AND TOBACCO

PRODUCTS 4

Manufacture of Other Food Products 4 4%

LAND TRANSPORT; TRANSPORT VIA PIPELINES 3

Other Land Transport 3 3%

MANUFACTURE OF COKE, REFINED PETROLEUM PRODUCST AND

NUCLEAR FUEL; MANUFACTURE OF CHEMICALS AND CHEMICAL

PRODUCTS; MANUFACTURE OF RUBBER AND PLASTIC PRODUCTS

3

Manufacturing of plastic products 3 3%

MANUFACTURE OF VARIOUS PRODUCTS 2

Publishing 2 2%


STRATPLAN

NOVEMBER 2012

15

SECTOR NUMBER OF

COMPANIES % OF TOTAL

MANUFACTURE OF WOOD AND PRODUCTS OF WOOD ETC 2

Printing and Services Related to Printing 1 1%

Manufacture of Products of Wood etc 1 1%

SUPPORTING AND AUXILLARY TRANSPORT ACTIVITIES 2

Supporting and Auxillary Transport Activities 2 2%

EDUCATION 1

Educational Services 1 1%

CONSTRUCTION 1

Building of Complete Constructions or Parts Thereof, Civil Engineering 1 1%

HEALTH AND SOCIAL WORK 1

Human Health Activities 1 1%

COMPUTER AND RELATED ACTIVITIES 1

Other Computer Related Activities 1 1%

REAL ESTATE ACTIVITIES 1

Real Estate Activities with Own or Leased Property 1 1%

MANUFACTURE OF TEXTILES, CLOTHING AND LEATHER GOODS 1

Manufacture of wearing apparel 1 1%

MANUFACTURE OF TRANSPORT EQUIPMENT 1

Building and Repairing of Ships and Boats 1 1%

TOTAL 90 100%

From the analysis in Table 4.3 three clusters of businesses that appear to be prominent in the

RHVBE emerge, viz.

The wholesale trade in machinery, equipment and supplies (14% of companies);

Other retail trade in specialised goods (16%); and

Post and associated courier services (10%).

There also appear to be smaller clusters of manufacturing activity which include the manufacturing

of products from basic metals (6%), manufacturing of plastic products (3%) and a range of other

specialised manufacturing activities.


STRATPLAN

NOVEMBER 2012

16

4.4. SYNOPSIS OF BUSINESS TYPES IN THE RHVBE

The 2007 Updated Baseline Study (Fakisandla 2007) stresses the important contribution that it is

anticipated the RHVBE will make to augmenting the supply of industrial land in eThekwini. The

2002 presentation referred to in previous sections also suggested a strong focus on industrial

development in the Estate. The above analysis, however, illustrated that the profile of businesses

that located in the Estate is complex and that a number of major economic sectors are well

represented. Manufacturing industry makes up 20% of businesses located in the Estate.

Whereas, the initial focus of the development was then perceived to be to address the shortage of

well-located industrial land in eThekwini, the results of the above assessment suggests a more

general shortage of well-located land for business development. This is perhaps most clearly

illustrated by the successful development of the eThekwini Hospital and Heart Centre in the

RHVBE, the location of the Mr Price Distribution Centre, as well as the Estate being selected by

several national and international courier and logistics companies as the most appropriate location

for their activities. Considering the multi-use nature of development in the RHBVE, the extent to

which the need for industrial land in eThekwini are being addressed, should then be considered.

It is expected that a future assessment and comparison of the business profiles of the RHVBE,

Mahogany Ridge and Southgate estates will provide an even better perspective on industrial,

business and logistics development in eThekwini over the past decade. Such an assessment should

also provide critical clues as to where the future focus for business estate development should be.


STRATPLAN

NOVEMBER 2012

17

5. ABOUT THE COMPANIES IN RHVBE

5.1. INTRODUCTION

The companies located in the RHVBE have a unique set of characteristics. These characteristics of

companies will generally determine the future impact of the development on economic and socio-

economic development in eThekwini and should therefore be better understood. The sections that

follow consider:

The size of companies based on turnover categories;

Linkages of RHVBE business facilities to companies;

New companies versus relocations;

Age of companies and facilities;

Reasons for selection of RHVBE as a business location; and

Spatial linkages.

5.2. COMPANY TURNOVER

As a result of the range of development options allowed for in the RHVBE the table below illustrates

the range of company sizes, based on turnover, located in the Estate.

TABLE 5.1: TURNOVER CATEGORIES OF RHVBE COMPANIES

TURNOVER CATEGORY NO. OF COMPANIES PERCENTAGE OF

COMPANIES

R1m to R5m 7 11%

R5m to R50m 21 34%

R50m to R100m 12 19%

R100m to R500m 11 18%

R500m to R1000m 4 6%

R1000m to R2000m 0 0%

R2000m to R5000m 2 3%

R5000m> 5 8%

TOTAL RESPONSES 62 100%

Of the 62 companies that provided turnover related information nearly a third falls within the R5

million to R50 million per annum turnover category, with another third in the category R50 million

to R500 million. Five companies indicated an annual turnover of more than R5 billion. (As the five

are branches of larger businesses it is generally assumed that this turnover relates to the larger

companies and not to the turnover achieved at the RHVBE facilities. However, this provides an

indication of the size of companies establishing in the Estate).


STRATPLAN

NOVEMBER 2012

18

Eleven percent of companies in RHVBE are smaller companies with a turnover of less than R5

million suggesting that the Estate also provides opportunities for the establishment and growth of

SMMEs and that this category of business is not excluded from the benefits offered by the Estate.

DIAGRAM 5.1: TURNOVER CATEGORIES OF RHVBE COMPANIES

5.3. LINKAGES OF RHVBE BUSINESS FACILITIES WITH COMPANIES

It is often suggested that KwaZulu-Natal is a branch economy with company head offices located

elsewhere. This statement was tested through the survey by establishing whether facilities in

RHVBE represented head offices, branches, independent units or subsidiaries. Diagram 5.2 overleaf

reflects on the findings.


STRATPLAN

NOVEMBER 2012

19

DIAGRAM 5.2: HEAD OFFICE OR BRANCH LOCATED IN RHVBE

It is evident from Diagram 5.2 that the majority of facilities in RHVBE are branches representing

larger business concerns in the Durban area. However, there is a relatively high proportion of head

offices (28%) or independent units (15%) also located within the Estate. Even if this relates

primarily to smaller companies it still provides an indication that a vibrant and independent

economy has been, or is in the process of being, established in the RHVBE.

Of the companies that indicated that they do report to a head office located elsewhere, the

majority, or 66%, relates to head offices located in Gauteng. Eleven percent of RHVBE facilities

relate to head offices in the Western Cape. A further 15% of companies have head offices

elsewhere in KwaZulu-Natal, i.e. outside of the Estate in Durban and Pietermaritzburg. Three

companies, representing approximately 6%, have international head offices.

TABLE 5.2: HEAD OFFICE LOCATION OF RHVBE COMPANIES

HEAD OFFICE LOCATION NO OF COMPANIES % OF COMPANIES

Gauteng 31 66%

Western Cape 5 11%

Durban 5 9%

Pietermaritzburg 3 6%

USA 1 2%

Germany 1 2%

Denmark 1 2%

TOTAL 47 100%

From the above it is concluded that a relatively high percentage of RHVBE facilities accommodate

head office functions, potentially higher than other business park developments in eThekwini (this

can however only be verified through further research). However, RHVBE companies also have

strong national, and in some cases international, ownership linkages.


STRATPLAN

NOVEMBER 2012

20

5.4. NEW COMPANIES VS RELOCATION

The extent to which the RHVBE contributed to economic growth through the establishment of new

businesses and new job opportunities has been questioned in the past (Houghton 2010).

Companies interviewed were requested to indicate whether their establishment in RHVBE was the

result of relocation, expansion or the establishment of a new company. Diagram 5.3 reflects on the

responses received.

DIAGRAM 5.3: RHVBE MOVE: RELOCATION, EXPANSION OR NEW COMPANY

Sixty one percent of companies interviewed indicated that their establishment in RHVBE were as a

result of a relocation process (reasons for this relocation is reflected on in more detail below).

Twenty two percent of companies suggested that they were outgrowing their premises at the time,

and that larger facilities were required. Only seven percent of companies indicated that they were

newly established in the Estate and did not relocate from elsewhere.

5.5. AGE OF COMPANIES AND FACILITIES

As indicated above, the companies in RHVBE are generally not new companies and have been

operating for a longer period of time. Diagram 5.4 reflects on when the companies were

established. The companies are grouped into three categories, i.e. established before and up to

1990, between 1991 and 2000 and between 2001 and the 2010.


STRATPLAN

NOVEMBER 2012

21

DIAGRAM 5.4: AGE OF COMPANIES LOCATED IN RHVBE

Nineteen percent of the companies accommodated in RHVBE were established after 2001 and can

therefore be viewed as new companies. A further 32% of companies were established between

1991 and 2000. Thirty nine percent of companies currently located in the RHVBE were established

before 1990. The overall picture is, however, a picture of a business estate with a balanced mix of

old and new companies, the older companies bringing with it the stability, while the newer

companies bring the growth, innovation and vibrancy to the mix.

Diagram 5.5 considers the years in which the companies interviewed were established in the

RHVBE.

DIAGRAM 5.5: YEAR WHEN COMPANIES ESTABLISHED IN RHVBE


STRATPLAN

NOVEMBER 2012

22

The majority of the companies interviewed were established in RHBVE between 2006 and 2009.

This is viewed as a relatively short period of time for a development of this nature to move from

establishment to nearly full occupation, partly confirming the success of the development. This

must then also be viewed as an indication of the substantial demand for well located and modern

business park developments in eThekwini.

5.6. SELECTION OF RHVBE AS A LOCATION

Diagram 5.6 below confirms that location was the primary reason for companies locating in the

RHVBE. A large number of companies, however, also indicated that they needed new premises for

either expansion or consolidation of current business activities. A smaller percentage of companies

also viewed the acquisition of property in River Horse Valley as an investment opportunity.

DIAGRAM 5.6: PRIMARY REASONS FOR LOCATING IN RHVBE

Considering the primary reasons for businesses locating in RHVBE must then be viewed in the

context of where businesses were drawn. The information for 66 of the interviewed firms is

reflected in Diagram 5.7 below.


STRATPLAN

NOVEMBER 2012

23

DIAGRAM 5.7: AREAS WHERE FIRMS RELOCATED FROM (TOTAL 66 FIRMS)

Diagram 5.7 confirms that nearly 50% of businesses were drawn from areas in close proximity to

RHVBE with 24% from Springfield Park and 21% from Durban North. Considering the close

proximity and the cost of resettlement it can be concluded that the advantages for companies to

resettle in RHVBE must have been considerable.

RHVBE attracting companies from the Congella, Berea, Umgeni Road, Durban Central and Jacobs

areas are easier understood. Most of these areas face challenges in terms of urban management,

lack of space and accessibility.


STRATPLAN

NOVEMBER 2012

24

6. REGIONAL AND GLOBAL LINKAGES

6.1. INTRODUCTION

In economic development planning substantial emphasis is placed on areas linking into the global

economy. Generally the ability of national and regional economies to integrate into the global

economy is viewed as a key factor in determining the health of the economy. As a new business

park development it is then important to consider the contribution that the RHBVE is making

regionally, nationally and globally in linking the Durban economy.

6.2. SPATIAL LINKAGES

From the survey findings it was established that the majority of companies located in the RHVBE

serve a wider area than Durban. Diagram 6.1 below indicates that only 11% of companies

interviewed have a narrower Durban focus, with 33% of companies serving the whole of KwaZulu-

Natal and at least 33% serving customers in various parts of South Africa. Eight percent of

companies interviewed indicated that the majority of the customers making use of their products or

services are located internationally.

DIAGRAM 6.1: LOCATION OF MAJORITY OF CUSTOMERS OF RHVBE BUSINESSES

Note: The “various” category includes companies that do not fit clearly into any of the other categories.


STRATPLAN

NOVEMBER 2012

25

6.3. INFRASTRUCTURE LINKAGES

Respondents were requested to indicate what major logistics infrastructure is critical to the

operations of their businesses. More than one component of infrastructure could be mentioned.

Diagram 6.2 reflects on the responses.

DIAGRAM 6.2: NUMBER OF MENTIONS OF CRITICAL LOGISTICS INFRASTRUCTURE

As would have been anticipated, more than 50% of companies indicate the critical nature of road

infrastructure for their operations. However, from the above it is also evident that the harbour and

the Dube Trade Port are both critical to the location decision-making of businesses in River Horse

Valley with the Dube Trade Port / King Shaka Airport receiving 23% of the mentions and the

harbour mentioned as being important to 25 companies or receiving 20% of the mentions.

6.4. EXPORTS

Nearly a third of the businesses interviewed indicated that they do export product / services. The

majority of these companies cannot be classified as exporters as a relatively small proportion of

their product / service is delivered to the global market. The diagram below, however, reflects that

61% of RHVBE companies interviewed indicated that they are not involved in any export activities.


STRATPLAN

NOVEMBER 2012

26

DIAGRAM 6.3: EXTENT OF EXPORTS BY RHVBE BUSINESSES

Four of the companies, translating to approximately 4% of companies in the RHVBE, can be

classified as exporters with more than 50% of their product / service being exported. This low

number potentially relates to the low number of manufacturing companies located in the Estate.

6.5. IMPORTS

The diagram relating to imports below, if compared to the information on exports above, provides a

different picture. No less than 20% of the companies interviewed indicated that they import more

than 50% of their basic inputs / products, with a further 22% involved in some import activity. This

translates to nearly 50% of companies interviewed being involved in import activities.

DIAGRAM 6.4: EXTENT OF IMPORTS BY RHVBE BUSINESSES

This supports findings confirming the importance of specifically the harbour as strategic

infrastructure for RHVBE businesses.


STRATPLAN

NOVEMBER 2012

27

6.6. SYNOPSIS ON LINKAGES

Considering regional and global linkages it is evident that the RHBVE can be described as a globally

linked business estate. There is, however, currently a greater focus on the import of products (or

production inputs) than on exports and this could partly be attributed to the relatively low number

of manufacturing firms in the Estate. The large number of logistics functions located in the RHVBE

also implies strong regional and global linkages.


STRATPLAN

NOVEMBER 2012

28

7. EMPLOYMENT IN THE RHVBE

7.1. INTRODUCTION

In a paper, Realistic Strategies for a Million Jobs: The Case of KwaZulu-Natal, McCarthy (2009)

states that South Africa’s unemployment rates are among the worst in the world and that “fresh

thinking on policy and development strategy” will be needed to address this. One of the strategies

recommended by McCarthy is the “renewal of traditional economic strengths around the N2 and N3

corridors to and from Durban”. The RHVBE is located on this corridor and an assessment of

employment in the Estate will also inform decision-makers and planners as to the impact of

proposed economic development strategies on future employment in the region.

This section considers the employment characteristics of companies in the RHVBE. Employment in

the RHVBE is considered from a number of perspectives, including:

The contribution of RHVBE companies to employment;

The contribution of contract workers to employment;

Empowerment in the Estate;

Skills levels employed in the Estate; and

Prospects for future employment.

7.2. CONTRIBUTION TO EMPLOYMENT BY RHVBE COMPANIES

Employment data offers the most comprehensive picture available when considering the

contribution of RBVBE to the eThekwini economy as only six of the 90 firms interviewed did not

provide total employment figures.

The 84 companies surveyed employs a total of 6 950 people. This translates to a total of 83 persons

per company. In terms of total employment this suggests that the 173 companies identified in the

Estate makes a total permanent employment contribution of 14 359 jobs. This is in excess of the 10

000 permanent jobs previously projected (based on limited initial 2007 survey data).

The table below reflects on the sectoral distribution of employment in the RHVBE and compares

this with the sectoral distribution of companies.


STRATPLAN

NOVEMBER 2012

29

TABLE 7.1: SECTORAL DISTRIBUTION OF EMPLOYMENT IN RHVBE (COMPARED WITH SECTORAL

DISTRIBUTION OF COMPANIES)

SECTOR NO OF

WORKERS

% OF

TOTAL

% OF

COMPA-

NIES

Manufacturing 1725 28% 21%

Wholesale and Retail Trade; Repair of Motor Vehicles, Motor Cycles

and Personal and Household Goods; Hotels and Restaurants 1946 32%

49%

Transport, Storage and Communication 1613 26% 20%

Community, Social and Personal Services 484 8% 2%

Financial Intermediation, Insurance, Real Estate and Business Services 357 6% 7%

Construction 0 0% 1%

TOTAL 6125 100% 100%

(Note: The one construction company interviewed did not supply employment figures)

The most significant observation from this is the 28% contribution of the manufacturing sector to

employment, whereas only 21% of the companies interviewed were classified as manufacturing

firms. This then suggest that the contributions of different sectors to employment vary

substantially. The average size of the workforce of a company in different sectors is reflected

below:

Manufacturing – 91 employees;

Wholesale and retail etc – 44 employees;

Transport storage and communication – 90 employees; and

Financial and business services – 60 employees.

In the case of the community, social and personal services only two companies were interviewed of

which one was the eThekwini Hospital employing nearly 600 people. An average for this sector is

therefore not included in the above listing.

Based on the above the diagram below graphically illustrates the distribution of employment in the

various economic sectors represented in RHVBE.


STRATPLAN

NOVEMBER 2012

30

DIAGRAM 7.1: SECTORAL DISTRIBUTION OF EMPLOYMENT IN RHVBE (6 125 WORKERS)

7.3. THE CONTRIBUTION OF CONTRACTERS TO EMPLOYMENT

Over and above permanent employment, companies also employ contractors and contract

workers on site. Due to the current sensitivities regarding contract and non-permanent workers, it

was anticipated that this form of employment will be under reported on. A total of 34 companies

responded to the question and these companies have a total of 2 312 workers employed by

contractors or that are employed as contract workers. For the Estate as a whole this then translates

to a contracted workforce of 4 446 employees. Adding this to the permanent workforce it is

estimated that in excess of 17 000 people are employed in River Horse Valley.

TABLE 7.2: CONTRACT WORKERS EMPLOYED OVER AND ABOVE FULL-TIME STAFF

SECTOR

NO OF

CONTRACT

WORKERS

NO OF

COMPANIES

RESPONDED

Community, Social and Personal Services 263 2

Financial and Other Business Services 231 3

Manufacturing 625 8

Transport, Storage and Communication 930 9

Wholesale and Retail Trade; Repair of various; Hotels and Restaurants 263 12

ALL RESPONDENTS (34 COMPANIES) 2312 34

It is noted from the above that the transport, storage and communication sector makes the largest

contribution to the employment of contract workers. However, most sectors make a contribution.


STRATPLAN

NOVEMBER 2012

31

7.4. NEW JOBS

Respondents were also requested to indicate the number of new jobs created since location or re-

location to RHVBE. Only 46 companies, roughly 50% of those interviewed responded to this

question and for the purpose of this analysis it is assumed that others did not create new jobs. The

results are reflected in the table below.

TABLE 7.3: NEW JOBS AS A PERCENTAGE OF TOTAL JOBS

SECTOR NEW JOBS (46

COMPANIES)

TOTAL JOBS OF

86 COMPANIES

% OF JOBS

NEW

Manufacturing 730 1725 42%

Community, Social and Personal Services 484 484 100%

Wholesale and Retail Trade; Repair of various;

Hotels and Restaurants

477 1946 25%

Financial and Other Business Services 300 357 84%

Transport, Storage and Communication 74 1612 5%

TOTAL 2 065 6 124 34%

In overall terms it is suggested that 30% of all jobs in the River Horse Valley Estate are new jobs, i.e.

created after the establishment in the RHVBE. Considering a total employment of 12 629, as

established earlier, this translates to 4 294 new jobs having been created in the Estate. From the

above the major contribution made by the eThekwini Hospital to new jobs created is evident in the

community, social and personal services sector.

The contributions made by specific sectors to new jobs created are reflected on in the table below.

TABLE 7.4: DISTRIBUTION OF NEW JOBS CREATED PER SECTOR

SECTOR NEW

JOBS

% OF

NEW

JOBS

NO OF

BUSINESSES

Manufacturing 730 35% 10

Community, Social and Personal Services 484 23% 2

Wholesale and Retail Trade; Repair of various; Hotels and

Restaurants 477 23% 25

Financial and Other Business Services 300 15% 1

Transport, Storage and Communication 74 4% 8

ALL RESPONDENTS (46 COMPANIES) 2065 100% 46

From the above it is noted that the manufacturing sector has made the most substantial

contribution to new jobs in the RHVBE.


STRATPLAN

NOVEMBER 2012

32

7.5. EMPOWERMENT IN RHVBE

A total of 50 companies provided detailed information on the employment of people from

historically disadvantaged backgrounds. An analysis of this information, presented in the table and

diagram below, suggests that in overall terms 74% or nearly three quarters of employees in RHVBE

can be classified as historically disadvantaged individuals.

TABLE 7.5: EXTENT OF HDI EMPLOYED IN DIFFERENT SECTORS (50 COMPANIES)

SECTORS NON HDI HDI HDI AND

NON-HDI

Community, Social and Personal Services 352 157 509

Financial and Other Business Services 186 25 211

Manufacturing 224 820 1044

Transport, Storage and Communication 71 420 491

Wholesale and Retail Trade; Repair of various; Hotels and Restaurants 189 1469 1658

ALL COMPANIES 1 022 2 891 3 913

DIAGRAM 7.2: % DISTRIBUTION OF HDI AND NON-HDI STAFF IN SECTORS (50 COMPANIES)

Levels of empowerment appears to vary substantially from sector to sector, with only 12% of

employees in the business services sector being, followed by community, social and personal

services with 31% HDIs. Empowerment levels appear to be high in the manufacturing (79%),

transport and storage (86%) and wholesale and retail (86%) sectors.


STRATPLAN

NOVEMBER 2012

33

7.6. SKILL LEVELS EMPLOYED IN THE RHVBE

An indication of the skill levels of employees in RHBVE companies was obtained. Distinction was

made in the enquiries between management, skilled workers, semi-skilled workers and unskilled

workers. The diagram below reflects on the skill levels of workers per sector.

DIAGRAM 7.3: EMPLOYMENT CATEGORY PER SECTOR IN RHVBE

In overall terms it would appear as if the level of skills in the River Horse Valley Estate as a whole is

high with 56% being classified as skilled (management and skilled workers). This suggests that the

businesses located in these facilities are dependent on access to highly skilled workforce. The

above should be viewed in the context of findings from earlier research undertaken in the Greater

Durban Metropolitan Area (GDMA). This research illustrated specifically the high level of skilled and

semi-skilled staff employed in the manufacturing sector.


STRATPLAN

NOVEMBER 2012

34

TABLE 7.6: EXPERIENCE OF MANUFACTURING WORKERS WHEN RECRUITING – GDMA, 2002/2003

CATEGORIES COMPANIES % OF TOTAL

Relevant work experience only 197 32.9

Primary education only 17 2.8

Secondary education only 83 13.8

Tertiary education only 5 0.8

Both work experience and primary education 38 6.3

Both work experience and secondary education 193 32.1

Both work experience and vocational education 18 3.1

Both work experience and tertiary education 47 7.8

Production is outsourced 3 0.4

Total 600 100

Source: Devey et al 2005

It is noted from the diagram that follows that the distribution of HDIs in the various skills categories,

which makes up a major component of the workforce, is fairly similar to that of the workforce as a

whole.

DIAGRAM 7.4: DISTRIBUTION OF HDI EMPLOYMENT PER CATEGORY AND SECTOR


STRATPLAN

NOVEMBER 2012

35

7.7. FUTURE EMPLOYMENT IN THE RHVBE

Companies were asked to indicate whether they anticipated employment to grow in the short to

medium terms or whether it will decline or remain stable. The responses are reflected in the table

below.

TABLE 7.7: ANTICIPATED FUTURE EMPLOYMENT GROWTH

SECTOR DECLINE REMAIN

STABLE GROW

NO

RESPONSE

Community, Social and Personal Services 0% 0% 100% 1

Construction 0% 0% 100% 1

Financial and Other Business Services 17% 0% 83% 6

Manufacturing 0% 53% 47% 17

Transport, Storage and Communication 6% 56% 38% 16

Wholesale and Retail Trade; Repair of

various; Hotels and Restaurants 2% 41% 56% 41

ALL COMPANIES 4% 43% 54% 82

More than 50% of companies indicated that they expect employment levels at their facilities in

RHVBE to grow further. It is noted that 5 of the 6 finance / business sector companies anticipated

growth. The manufacturing and wholesale and retail sectors were also optimistic about future

growth. A further 43% of companies indicated that employment will remain stable and only 4%, a

handful of companies, anticipated a decline.

Importantly, the above illustrates the positive future outlook among the companies interviewed.

7.8. PLACE OF RESIDENCE OF EMPLOYEES

Companies employing approximately 50% of the workforce (of the respondents) could provide

information relating to the place of residence of employees. The results are reflected on in the table

below.

TABLE 7.8: PLACE OF RESIDENCE OF EMPLOYEES

AREA NO OF EMPLOYEES PERCENTAGE

Ink (Inanda-Ntuzuma-KwaMashu) 984 32%

Ethekwini South 710 23%

Ethekwini North 527 17%

Reservoir Hills / Newlands etc. 256 8%

Durban CBD 227 7%

Ethekwini West 219 7%

Avoca Hills 119 4%

OTHER (Indicate) 74 2%

TOTAL 3,117 100%


STRATPLAN

NOVEMBER 2012

36

It is noted that the majority of employees, or 32%, are drawn from the INK area. It is then also

noted that a high percentage of the employees are from the southern parts of eThekwini. Further

investigation revealed that approximately 50% of those from Durban South relates to the recent

2011 relocation of one major company from Prospecton to River Horse Valley.

By far the majority of employees employed in RHVBE are then drawn from the general area in

which it is located, i.e. INK (32%) and Durban North (17%), with Reservoir Hills, Newlands and Avoca

Hills making a combined 12% contribution to employment.

7.9. SYNOPSIS ON FINDINGS RELATING TO EMPLOYMENT

It is estimated that that in excess of 17 000 people are employed directly and indirectly by

companies in the RHVBE. In order to place this in context, the table below indicates the

contribution that various employment nodes in eThekwini made to total employment in the early

2000s.

TABLE 7.9: THE SPREAD OF EMPLOYMENT ACROSS ETHEKWINI BY TYPE AND NUMBER OF JOBS,

2001

MAIN ECONOMIC

NODES

APPROXIMATE

TOTAL NODAL

EMPLOYMENT

PERCENTAGE

OF ETHEKWINI

EMPLOYMENT

KEY ACTIVITIES IN EACH NODE

Durban Central 137000 28% Retail, Services, Offices, Conferences,

Education, Tourism

Jacobs / Mobeni 73400 15% Mature industrial (Chemicals, Plastics,

Confectionery, Textiles, Footwear,

Packaging, Engineering)

Pinetown / New Germany 52200 11% Mature Industrial ( Textiles, Earthmoving,

Beverages, Footwear Components,

Electronics, Medical Goods)

Port of Durban / Maydon

Wharf

35000 7% Tourism, Freight Logistics and Transport

Manufacturing, Engineering, Recreation

Chatsworth 25100 5% Retail, Services

Isipingo / Prospecton 21000 4% Automotive, Food, Plastics, Carpets,

Chemicals, Beverages, Transport,

Distribution

Coedmore 14200 3% Stone Quarry and Cement

Springfield Park 12000 2% Light industrial, Retail

Queensburgh /

Umhlatuzana

11800 2% Small light to medium industrial - growth

potential

Extract from Graham Muller (2006)


STRATPLAN

NOVEMBER 2012

37

From the above it is noted that the Estate already makes a much higher contribution to

employment than areas such as Springfield Park and are moving closer to the employment levels

achieved in the Isipingo / Prospecton areas.

The assessment further established that:

Thirty four percent of permanent jobs established in the RHVBE are new jobs, i.e. jobs that did

not exist previously before relocation to the area.

Three quarters of workers employed in RHVBE are classified as being from historically

disadvantaged backgrounds.

The workforce in the RHVBE is highly skilled with 56% of employees being classified as

management (9%) or as skilled workers (47%). A further 31% is classified as semi-skilled.

Importantly, the majority of companies (54%) anticipate further growth in employment in the

RHVBE in the short to medium term.


STRATPLAN

NOVEMBER 2012

38

8. THE FACILITIES OF RHVBE COMPANIES

8.1. INTRODUCTION

The assessment of facilities of companies in the RHVBE considers briefly the ownership of

properties / facilities, the space occupied by companies and their capital expansion plans.

8.2. OWNERSHIP OF PROPERTIES

The survey established the extent to which companies own or lease facilities in RHVBE. Seventy of

the ninety companies interviewed responded to this question. Twenty-seven or 39% of the

companies that responded confirmed that they owned the land and facilities located in the River

Horse Valley. Sixty one percent of the companies indicated that they lease the facilities.

DIAGRAM 8.1: COMPANIES THAT OWN OR LEASE FACILITIES

The diagram below considers the ownership by companies of facilities in different turnover

categories. Although it was anticipated that strong patterns would emerge from this, it is not the

case.


STRATPLAN

NOVEMBER 2012

39

DIAGRAM 8.2: OWNERSHIP OF FACILITIES IN DIFFERENT TURNOVER CATEGORIES

Of the five companies that indicated the highest turnover four or 80% indicated that they lease the

facilities that they operate from. In the lowest turnover category 60% of companies indicated that

they lease the facilities they operate from.

In general it can be concluded that a higher percentage of the larger companies own their facilities

in the RHVBE, whereas smaller companies are more likely to lease facilities.

8.3. SPACE OCCUPIED

Through the survey process attempts were made to obtain a better understanding of space

utilisation in the RHVBE. Unfortunately, this type of information is not generally available and only

a limited number of companies provided inputs in this regard.

Diagram 8.3 below reflects on the distribution of building space for those companies that

responded in the following categories:

Warehousing, logistics,

Office space,

Manufacturing,

Retail, and

Other.


STRATPLAN

NOVEMBER 2012

40

DIAGRAM 8.3: APPROXIMATE DISTRIBUTION OF BUILDING SPACE (IN M2)

The dominance of warehousing / logistics space in River Horse Valley was anticipated. However,

the substantial contribution of office space to the total area occupied by companies in RHVBE

appears to be high (nearly a quarter of total space), but again confirms the multi-use nature of the

estate. The low percentage of manufacturing space relates to only a quarter of manufacturing

companies supplying this information.

8.4. CAPITAL EXPANSION PLANS

Only 16 companies responded to the request for the value of their capital expansion plans for the

next 5 years. The total of these capital expansion plans of the 16 companies came to R1.2 billion, of

which R1 billion of this relates to one major company. The other 15 companies combined suggested

capital investment to the value of R214 million or R14.3 million per company over the next 5 years.

The capital investment of these companies ranged from between R200,000 and R150 million.


STRATPLAN

NOVEMBER 2012

41

9. URBAN MANAGEMENT CONSIDERATIONS

9.1. INTRODUCTION

A key objective of the survey process was to establish how companies in River Horse Valley

experience the environment in which they are located and then how their activities can be

enhanced. The River Horse Valley Business Estate is unique in that it has a well-established

Management Association in place that has been responding to the needs of owners and tenants

over a number of years. Background on the activities of the River Horse Valley Business Estate

Management Association (RHVBEMA) is provided in Annexure C.

It is assumed that most companies are aware of the existence of the RHVBEMA as they are being

engaged with on a regular basis. As a first step, and for interest, the awareness of companies

relating to the location of the offices of RHVBEMA was tested.

DIAGRAM 9.1: RESPONDENTS KNOWING WHERE RHVBE MANAGEMENT OFFICES ARE LOCATED

Despite the centrally located offices of the Association, the representatives of many companies are

not aware of the location of their offices in the Estate. This can possibly be ascribed to the fact that

most communication takes place using either direct contact by field staff, telephone or email.

Companies were not asked to indicate whether they are aware of the existence of the web site of

the association as this was only recently launched.

9.2. THE ROLE OF THE MANAGEMENT ASSOCIATION

Companies were asked to identify those issues that they believe the management association

should focus on, on their behalf. Three priorities could be listed by each company. The table below

reflects on the number of times an issue was mentioned by respondents.


STRATPLAN

NOVEMBER 2012

42

TABLE 9.1: ISSUES TO BE FOCUSSED ON BY THE RHVBE MANAGEMENT ASSOCIATION

ISSUES MENTIONED NUMBER OF MENTIONS % OF MENTIONS

Safety and security 46 26%

Resolving transport issues 32 18%

Aesthetic environment 15 9%

Improving accessibility 10 6%

Marketing the area 8 5%

General maintenance 8 5%

Further development 7 4%

Maintain utilities 7 4%

Addressing urban grime 5 3%

Respond to tenant / owner issues 4 2%

Additional urban facilities 4 2%

Increase property values 4 2%

Maintain environment 4 2%

Communication 3 2%

Other 13 7%

TOTAL 176 100%

The Management Association addressing safety and security issues (26%) and the need to resolve

transport issues (18%) received a high priority from respondents. These are expanded further on in

the sections that follow.

It is insightful from the above that a number of respondents mentioned the potential role of the

Association in:

Marketing and branding the area;

Assisting in the provision of additional urban facilities (restaurants, fast food outlets and

retailers were listed); and

Supporting the increase in property values.

9.3. URBAN MANAGEMENT ISSUES

Companies were requested to rate specific urban management issues in terms of whether it is a

major problem, a problem or not a problem. The results are reflected in Diagram 9.2 below.


STRATPLAN

NOVEMBER 2012

43

DIAGRAM 9.2: RATING OF URBAN MANAGEMENT ISSUES BASED ON PERCEPTION OF

RESPONSDENTS

Respectively 64% and 52% of respondents viewed traffic management and traffic policing as a

“major problem” within the RHVBE. Although it has been suggested that this frustration of

respondents relates primarily to the current construction of further lanes on Queen Nandi Drive,

and the lack of public transport facilities in the development area, this perception should be further

investigated and confirmed. Both Queen Nandi Drive and public transport issues are currently

being addressed.

Approximately 60% of respondents indicated that the following does not present an issue, viz.

Maintenance of verges and open space;

Street lighting;

Street cleaning; and

Refuse removal.

The majority of respondents, 65% or two thirds, did view safety and security as a problem of which

21% viewed this as a major problem. This is a high percentage considering that specialised security

management systems are in place. A further more detailed assessment of this aspect should be

undertaken to confirm whether this is a perception that exists because of the general safety and

security situation in South Africa, or whether it is based on actual experiences in the Estate.


STRATPLAN

NOVEMBER 2012

44

9.4. TRANSPORT RELATED ISSUES

In the previous section traffic management was highlighted as a key issue to be addressed. The

diagram below unpacks further the traffic management issues giving an indication of what were

perceived by respondents to contribute to their perception of traffic management as a problem.

DIAGRAM 9.3: PERCEIVED TRAFFIC MANAGEMENT ISSUES

From the above it is noted that the majority of those that responded saw road capacity as an issue.

Whether this only relates to Queen Nandi Drive or also to other areas will have to be further

investigated.

9.5. CORPORATE SOCIAL RESPONSIBILITY

A view exists that the Management Association structure could potentially play a significant role in

supporting Corporate Social Responsibility programmes relating to the Estate, targeting specifically

neighbouring communities. Companies were therefore firstly requested to indicate whether they

have corporate social responsibility programmes in place, and, secondly, whether they would be

interested in participating in RHVBE focussed corporate social responsibility programmes. The

responses of companies are reflected in the diagrams below.


STRATPLAN

NOVEMBER 2012

45

DIAGRAM 9.4: COMPANIES WITH CORPORATE SOCIAL RESPONSIBILITY PROGRAMMES IN PLACE

A low 34% of companies indicated that they have formal Corporate Social Responsibility

Programmes (CSRP) in place. This aspect should be further assessed based on the comprehensive

database, but indications are that it is generally the larger companies that have SRPs in place. A

number of these companies commented in interviews that these programmes are head office based

and that communities in the vicinity of River Horse Valley are not necessarily targeted.

DIAGRAM 9.5: COMPANIES INTERESTED IN PARTICIPATING IN RHBVE FOCUSSED CORPORATE

SOCIAL RESPONSIBILITY PROGRAMMES


STRATPLAN

NOVEMBER 2012

46

A high 30% of companies did not respond to this question and a further 21 % indicated that they are

not interested in being involved in CRSP led by the RHVBE Management Association. However,

nearly 50% of companies did indicate that they would either like to participate in such programmes

or will consider being involved.

It is suggested that this provides a sufficient basis for exploring the potential of a RHVBE led Social

Responsibility Programmes targeting neighbouring communities.

9.6. SYNOPSIS OF URBAN MANAGEMENT ISSUES

It is evident from the survey that companies see an important role for the Management Association

to continue fulfilling in the Estate. The important focus areas should be safety and security,

resolving transport issues and impacting positively on the aesthetic environment. However, a

number of other functions such as the marketing and branding of the Estate should also be

considered.

It would further appear from the responses that the safety and security issue is the major concern,

followed by a range of transport issues. It has, however, been noted that a number of the

highlighted transport issues are in the process of being addressed.

The number of Corporate Social Responsibility Programmes focussing on specifically addressing

social development issues in neighbouring communities appears to be limited. Nearly 50% of

companies did, however, indicate that they will consider participating in such programmes

managed through the Management Association.


STRATPLAN

NOVEMBER 2012

47

10. AN ANALYSIS OF RATES CONTRIBUTIONS

10.1. INTRODUCTION

A comprehensive database of Valuation Roll information for RHVBE properties could not be

accessed. A database was therefore compiled using an ownership database supplied by RHVBE

Management Association. This database listed all freehold and sectional title properties and basic

ownership information. Checking each of these properties against the 2012 online eThekwini

Valuation Roll the RHVBE Valuation Roll was compiled. The valuation roll information for a total of

127 of the listed 196 freehold and sectional title properties was accessed.

10.2. RHVBE RATES INFORMATION

Based on the available information the total market value of properties in the RHVBE, based on the

2012 Valuation Roll, was firstly established. The table distinguishes between:

Freehold properties;

Sectional title properties; and

Properties for which rates information is not available.

TABLE 10.1: SUMMARY OF ANNUAL RATES PAYABLE FOR RHVBE PROPERTIES

PROPERTY TYPE AND RATES CATEGORY

NO OF PROPERTIES

COMBINED MARKET VALUE

CATEGORY MARKET VALUE

ANNUAL RATES PAYABLE

1) Freehold 56 properties R 1,705,495,000

Business & Commercial

R 419,950,000 R 8,701,364

Industrial

R 1,155,500,000 R 30,898,070

PSI

R 5,000 R 11

Vacant Land

R 130,040,000 R 5,690,550

2) Sectional title 71 properties R 373,947,000

Business & Commercial

R 202,650,000 R 4,198,908

Industrial

R 171,160,000 R 4,576,818

Residential

R 137,000 R 1,252

TOTAL 127 properties R 2,079,442,000

R 54,066,974

3) Rates info not available 69 properties R1,129,775,574*

+ R 29,374,970**

TOTAL ESTIMATED VALUE

R 3,209,217,575

TOTAL ESTIMATED ANNUAL RATES R 83,441,945

* Estimated market value using an average value per property (from available information)

**Estimated rates value using an average rate per property


STRATPLAN

NOVEMBER 2012

48

The estimated combined market value of properties in the River horse Valley Business Estate is R3,2

billion, the “Category Value” column indicates the breakdown of this in terms of different rating

categories. Specific rate randages (i.e. rates per rand) as published by the eThekwini Municipality

annually was applied to the market value of properties to establish the potential annual rates

income. The rate randages, as promulgated in a Notice dated 30 May 2012, are:

Residential – 0.914 cents

Industrial – 2.674 cents

Business and Commercial – 2.072 cents

Public Service Infrastructure – 0.228 cents

Vacant land – 4.376 cents

Based on the above rate randages the annual rates generated from the RHVBE development can

potentially be as high as R83.5 million.

10.3. CONSIDERING THE IMPLICATIONS

Previous assessments of the rates income to be generated by the Estate suggested an annual

income for the Municipality of up to R42 million. Based on the assessment of the 2012 Valuation

Roll it was established that the rates income to be derived from existing developed and

undeveloped land can be as high as R83.5 million. This contribution is set to increase once the

Estate is fully developed.


STRATPLAN

NOVEMBER 2012

49

11. CONCLUDING COMMENTS: THE IMPACT OF THE RHVBE

11.1. INTRODUCTION

The objectives of the study were firstly to confirm the impact to date of the River Horse Valley

Business Estate in terms of the local economy, employment and investment and, secondly, to

provide urban management decision-makers with a better understanding of what can be done to

further support the growth of businesses, employment and opportunities in River Horse Valley.

The assessment was specifically undertaken with a view to establishing whether the eThekwini

Municipality as the joint venture partner of Tongaat Hulett achieved it’s intended objectives

through the development. As a yardstick for measuring this achievement, it is noted that the

Effingham Development Joint Venture has spent R215.7 million to date on the installation of

infrastructure, including roads, services and platforms, creating serviced saleable sites to sell. The

eThekwini Municipality is roughly a two-thirds partner in the Joint Venture (pers com Joint Venture).

EThekwini has also spent R300 million on the construction of Queen Nandi Drive, however, this

road was viewed as essential infrastructure serving the larger region and was not constructed with

the view to provide access to the RHVBE. The proposed RHVBE development rather supported the

motivation for providing this strategic infrastructure linking major residential and business

townships, restructuring the colonial and apartheid urban landscape.

11.2. CORE FINDINGS

Based on the survey of 90 of a total of 173 companies and the collection of other relevant

information the core findings of the study related to:

Development cost: A total of R215.7 million, of which eThekwini made roughly a two-thirds

contribution, was spent on establishing and servicing the Estate (this excludes top structure

development). To place this in context this investment must be compared to public sector

spending on the uShaka Marine World (R735 million), the Durban ICC (R900 million in the 1990s),

the Moses Mabhida Stadium (R3.4 billion) and the King Shaka International Airport (R7.8 billion). In

comparison the public sector investment in RHVBE has thus been relatively small.

Capital investment: From calculations based on the 2012 eThekwini Municipality Valuation Roll of

the RHVBE the market value of properties in the RHVBE was estimated at R3.2 billion. Through the

survey further investment of R1.2 billion over the next five years could be confirmed. This is viewed

as a conservative estimate of the actual capital investment as it is anticipated that market value for

industrial properties will be well below the actual investment value. Again, to place this in context,

the construction of 4 000 middle income houses (each valued at R800 000) will equate this

investment value of R3.2billion. This capital investment of R3.2 billion should then also be

considered in the context of the R3.4 billion Moses Mabhida Stadium and the R7.8 billion King

Shaka International Airport.


STRATPLAN

NOVEMBER 2012

50

Municipal Rates Contribution: The rates contribution of properties in RHVBE is estimated to be

R83 million per annum, or more than a third of the actual investment cost of R215.7 million. This

will equate to the rates contribution of 6 000 homes valued at R1.5 million each, or 11 500 R800 000

homes.

Employment: Based on the survey findings it was estimated that in excess of 17 000 people are

employed in RHVBE. The permanent workforce is estimated to be 12 629 (of which 4 249 are new

jobs) augmented by a contract workforce of 4 446 people (including employees of contractors and

contract staff). Estimates from the early 2000’s placed employment in Isipingo / Prospecton at 21

000 people, Springfield Park at 12 000 and Phoenix Industrial at 4 500. The Durban ICC is suggested

to create 3 376 jobs directly related to the core activities of the Centre. Further to this, the majority

of employees employed in RHVBE are drawn from the general area in which it is located, i.e. INK

(32%) and Durban North (17%), with Reservoir Hills, Newlands and Avoca Hills making a combined

12% contribution to employment.

11.3. OTHER BASIC FACTS

A number of key facts confirmed through the assessment are highlighted:

A total of 173 companies were confirmed to be currently active in the RHVBE (52% or 90 were

interviewed for this assessment). With new developments this number is continually

increasing.

49% of companies were classified as being part of the wholesale and retail sector, 21%

manufacturing sector related and 20% belonging to the transport, storage and communication

sector.

Three “clusters” feature prominently in the Estate viz. wholesale trade in machinery, equipment

and supplies (14% of companies), other retail trade in specialised goods (16%); and post and

associated courier services (10%).

The majority of facilities in RHVBE are branches representing larger regional, national and

international business concerns, however, there is a relatively high proportion of head offices

(28%) or independent units (15%) also located within the Estate.

Sixty one percent of companies interviewed indicated that their establishment in RHVBE were

as a result of a relocation process, with a further 22% suggesting they were outgrowing their

premises at the time of relocation, and 7% percent being newly established.

A high 19% of the companies accommodated in RHVBE were established after 2001 and can

therefore be viewed as new or emerging companies. A further 32% of companies were

established between 1991 and 2000, and 39% before 1990.

Nearly 50% of businesses were drawn from areas in close proximity to RHVBE with 24% of

businesses previously located in Springfield Park and 21% located in Durban North.

The Estate is nationally and globally linked with a number of companies being involved in

export and import activities.

From the above it is concluded that the RHVBE, within a short period of time, has established itself

as an integral part of the economic fabric of the eThekwini Municipality.


STRATPLAN

NOVEMBER 2012

51

11.4. CONSIDERING THE IMPACT

This current assessment and previous studies considered the impact of the RHVBE from a number

of perspectives. Each of these perspectives are briefly reflected on below.

Attracting / retaining major companies: The Estate, although not successful in facilitating new

company formation, has succeeded in providing a number of major companies with an alternative

location to consolidate and/or expand its eThekwini operations. Importantly, it also provided

companies with an opportunity to improve operational efficiencies specifically from a logistics

perspective and their corporate image. The move of companies from older industrial and business

estates also established opportunities for the establishment and growth of new and existing

businesses in those areas. The fact that industrial property vacancy rates in eThekwini has

remained low in the recessionary climate suggests that the need for such properties has been

substantial.

Creating and retaining jobs: It was illustrated that the Estate offers in the region of 17 000

employment opportunities, making it one of the major employment nodes in eThekwini. At least 4

200 (approximately 34%) of these jobs were new jobs created as a result of the establishment of the

Estate. The employment created through the construction phase should also be considered in this

regard and is discussed in substantial detail by McCarthy (2009).

Boosting municipal rates: It is estimated that the Estate currently generates annual rates

amounting to R83.5 million. This will increase as the development of sites in the Estate continues.

Facilitating investment: The estimated combined market value of properties in the Estate, based

on the 2012 eThekwini Valuation Roll, is currently set at R3.2 billion. Further investment in the

Estate of R1.2 billion by various industries have been confirmed through the assessment. This

suggests a gearing ratio of nearly 1:15 if the investment of the Joint Venture in terms of

infrastructure is considered against this overall investment (land and management costs are

excluded from this calculation).

Enhancing the urban environment: Through the planning and the various initiatives of the

Management Association, former sugar cane fields are now being rehabilitated and integrated into

the urban environment. Key contributions of the Estate in this regard then includes (1) the

establishment of an aesthetically acceptable business park, including a number of state of the art

facilities with architectural merit, (2) wetland rehabilitation and (3) a range of associated initiatives

as reflected on in reports by the RHVBEMA.

Enhancing urban infrastructure: The development of the Estate not only supports the

densification strategies of eThekwini, but also facilitated the development of critical urban

infrastructure, specifically the construction of Queen Nandi Drive and the access onto the N2 both

contributing to the restructuring of the colonial and apartheid urban landscape by providing

improved linkages between residential and business townships. A contribution is also made to the

more efficient utilisation of existing infrastructure.


STRATPLAN

NOVEMBER 2012

52

11.5. POSSIBLE NEGATIVE IMPACTS OF THE ESTATE

The above, mostly positive impacts, should be considered against the possible negative impacts.

To date the only potential negative impact that could be identified through this assessment is the

impact of this development on neighbouring and other competing business estate developments

brought about by the relocation of businesses to the newer River Horse Valley Business Estate.

From the assessment it is evident that such relocations have taken place. However, in light of low

industrial vacancy rates in eThekwini the impact of this on those areas are not viewed as

substantial. Such relocations also potentially provide quality space for smaller and emerging

businesses to grow into. This impact could be further investigated if high vacancies rates from

neighbouring estates can be confirmed.

11.6. ISSUES TO BE ADDRESSED

A number of issues identified through this and previous assessments should continue to be

addressed through the ongoing activities of the Management Association. These include:

Safety and security: This is an ongoing focus of the Management Association and there may be

a need to better understand the concerns of businesses in this regard. It is, however, noted that

levels of reported crime is low and that levels of surveillance is higher than in most similar

development areas.

Transport issues: Various transport issues have been highlighted including congestion on roads,

the lack of coordinated taxi transport and traffic management in general. Most of these issues

are currently being addressed through various initiatives, but with the extent of development in

the area, the strong logistics function and the public nature of Queen Nandi Drive specifically

this aspect will always have to be managed.

Access to facilities: Access to facilities, specifically for staff, has been a key issue to be

addressed highlighted in all previous assessments. To some extent this will be addressed with

the development of two sites by Engen, who will be providing convenience and fast food

outlets, which is currently in planning. Further attention should, however, be afforded towards

planning for this component of the Estate. Considering the number of people employed in the

development and the location of the development further retail development in the area may

present an opportunity.

Corporate social responsibility: It has been confirmed that the current impact of corporate

social responsibility programmes on neighbouring communities are limited. Based on the

responses of companies it is suggested that the potential for a coordinated social responsibility

programme managed by the Association should be considered.


STRATPLAN

NOVEMBER 2012

53

11.7. CONCLUSION

The assessment has confirmed the significant positive impact of the River Horse Valley Business

Estate on investment, job creation, rates generation and urban development. It is suggested that

other investment in strategic infrastructure made by the eThekwini Municipality should also be

evaluated in terms of the identified criteria and that a comprehensive understanding be developed

on what strategies will best support the efforts of national government to create 11 million jobs by

2030. The criteria applied in the case of the River Horse Valley Business Impact Assessment can also

be applied in assessing other investments in eThekwini. This will assist decision-makers in

comparing various investment options.

The criteria to be considered must include the contribution of a development / investment towards:

Attracting / retaining major companies;

Creating and retaining jobs;

Boosting municipal rates;

Facilitating investment;

Enhancing the urban environment; and

Enhancing urban infrastructure.


STRATPLAN

NOVEMBER 2012

54

BIBLIOGRAPHY

Devey, R. Valodia, I. And Velia, M. 2005. Constraints to Growth and Development: Evidence for

the Greater Durban Metro.

eThekwini Municipality, 2009. Industrial Spatial Strategy. Presentation by the Framework

Planning Branch, eThekwini Municipality.

Fakisandla Consulting, 2007. River horse Valley Business Estate: An Updated Baseline Study.

Graham Muller and Associates, 2006. eThekwini Municipality Economic Review 2006/7.

Houghton J. 2005. Baseline Study: River horse Valley Business Estate.

Houghton J. 2010. Negotiating the Global and the Local: Evaluating Development Through

Public-Private Partnerships in Durban, South Africa. Published in Urban Forum (2011) 22:75-93.

McCarthy J. 2009. Socio-economic Impacts of River horse Valley.

McCarthy J. 2009. Realistic Strategies for a Million Jobs: The Case of KwaZulu-Natal. Centre

for Development and Enterprise.


STRATPLAN

NOVEMBER 2012

55

ANNEXURE A: QUESTIONNAIRE

RIVER HORSE VALLEY IMPACT STUDY

QUESTIONNAIRE

The eThekwini Municipality in partnership with Tongaat Hulett Developments (the Effingham Development Joint

Venture) set out in 1994 to establish the River Horse Valley Business Estate with construction getting underway in

2002. The Estate is now well established and thriving, but it is critical to establish to what extent the objectives for

establishing the Estate has been achieved. For this purpose a development planning consultancy, StratPlan, has

been appointed by the eThekwini Municipality to assist with undertaking a socio-economic impact study.

The objectives for the study are:

1) To confirm the impact to date of the River Horse Valley Business Estate in terms of the local economy,

employment and investment;

2) To offer decision-makers with a better understanding of what can be done to further support the growth of

businesses, employment and opportunities in River Horse Valley Business Estate (RHVBE).

It is intended that the study process and findings highlight further the successes achieved to date and hence further

raise the profile of the area. Successes already identified include the conclusion of a public private partnership

development with all sites in RHVBE now having been sold, the work that commenced recently to upgrade Queen

Nandi Drive and various other successes of the River Horse Valley Business Estate Management Association

(RHVBEMA). These successes include the forthcoming rehabilitation of 41 hectares of wetland, the R750 000

indigenous tree planting programme, addressing public transport issues and the general management of the area

by the RHVBEMA. The estate is setting new benchmarks in the development and management of business estates.

The information required through this survey relates only to your operations in the River Horse Valley location and

not to that of the larger company (if relevant). The information to be supplied will be used to identify strategic

issues within RHVBE and also in the planning and development of similar estates. Therefore the focus of the

questionnaire is on:

understanding the origins and activities of your company,

considering your contribution to the local economy, and

identifying how Tongaat Hulett Developments and the eThekwini Municipality (the Effingham Development

Joint Venture) can better support your business.

The questionnaire is structured in the following distinct sections (each with sub-sections):

About the Company

Business of the Company

Management and Staff

Finance and Investment

Urban Management

Senior researchers are available to meet with you to complete the questionnaire and you will be contacted to

establish whether you need such support. We estimate the completion of the questionnaire will take less than 20

minutes.


STRATPLAN

NOVEMBER 2012

56

Confidentiality: It should be noted that all information supplied by businesses during the course of this survey

will be treated with utmost confidence. The aim will be to extract trends from the data gathered in the survey since

this is the major focus of the project. All data will be analysed and presented in the report on an aggregated basis

only.

Should you have any queries relating to the questionnaire please contact: Tindall Kruger (StratPlan) 071 698 1362,

or Denny Thaver (Economic Development Unit, eThekwini Municipality) 031–3114037 / 083-3019963

([email protected])

Completed questionnaires are to be submitted to: Fax 086 514 1588, email [email protected] or submitted at

the offices of the River Horse Valley Business Estate Management Association (RHVBEMA) at Corobrick Road,

RHVBE.

1. ABOUT THE COMPANY

1.1 Name of Company

1.2 Name and Position of Person Responsible for Completion of Questionnaire

1.3 Contact Details Tel no.

Fax no.

e-mail

1.4 Are you a Head Office, Branch, Subsidiary or Independent Unit?

Mark with X

Head Office

Branch

Subsidiary

Independent Unit

1.5 If Branch or Subsidiary, where is your Head Office located?

1.6 Is this a relocation / expansion / or new company

Mark with X

Relocation

Expansion

New Company

1.7 Where did you relocate from? (if relevant)

1.8 When was your company established?

1.9 When did you locate in River Horse Valley Business Estate (RHVBE)?

1.10 Why did you locate in RHVBE, i.e. main reasons for selecting RHVBE?

1.11 Did the RHVBE fulfil your expectations? (Mark with X)

Rate from 1 to 5 with (1 = unfulfilled and 5 = totally satisfied)

1 2 3 4 5

mailto:[email protected]

mailto:[email protected]


STRATPLAN

NOVEMBER 2012

57

2. THE BUSINESS OF THE COMPANY 2.1 What are your primary products / services?

(list top 3 and indicate others) 1)

2)

3)

Other:

2.2 Where are the majority of your customers located?

Mark with X

River Horse Valley Business Estate

Durban CBD

Durban South

Durban North

Durban West

KwaZulu-Natal

Gauteng

Rest of RSA

International

Other / Combination

2.3 Do you export goods and/or services from your RHVBE facility? (Mark with X)

No exports

Less than

50%

More than 50%

2.4 Do you import goods (inputs) to your RHVBE facility?

No import Less than 50 % of inputs

More than

50% of inputs

2.5 Are you dependent (without it your business cannot function) in your activities on links with the following:

Mark with X

King Shaka Airport

Dube Trade Port

Harbour

Rail infrastructure

Major road infrastructure

Challenges: (if any)

3. MANAGEMENT AND STAFF 3.1 How many full-time employees do you have in

your facility in RHVBE? (Category breakdown)? Number that are classified as Historically Disadvantaged Individuals (HDI)?

CATEGORY Total

Number Number of

HDIs

Management

Skilled

Semi-skilled

Unskilled Labour

TOTAL STAFF

3.2 How many NEW jobs were created from the relocation / expansion / new company in RHVBE?

3.3 How many contract workers / contract staff do you have on average at your facility on a daily basis?


STRATPLAN

NOVEMBER 2012

58

3.3 From what areas is your permanent workforce drawn from? What is the main form of transport to place of work?

AREA Percentage estimate

Form of Transport

Avoca Hills

INK [Inanda-Ntuzuma-KwaMashu]

Reservoir Hills / Newlands / etc

Durban CBD

eThekwini North

eThekwini West

eThekwini South

Other (indicate):

3.4 Do you anticipate that your workforce will grow, remain stable or decline over the next three years? Mark with X

Grow Remain stable

Decline

FINANCE AND INVESTMENT Turnover Category Mark with X

4.1 What is your annual turnover category (based on 2010/11)?

R1m to R5m

R5m to R50m

R50m to R100m

R100m to R500m

R500m to R1 000m

R1 000m to R2 000m

R2 000m to R5 000m

R5 000m >

Actual annual turnover for 2010/2011 (optional) R

4.2 What is your annual remuneration (total salary bill) R

4.3 Do you own or lease the (1) land and the (2) facility from which you operate? Mark with X

Mark with X

Land Own Lease

Facility Own Lease

4.4 What is the estimated value of your current capital investment in RHVBE?

R

4.5 What is the approximate extent of the space occupied by your company in RHVBE?

Area in m2

Offices

Warehousing / Logistics

Manufacturing

Retail

Undercover

Other:

4.6 What is the value of your capital expansion plans for the next 5 years?

R


STRATPLAN

NOVEMBER 2012

59

URBAN MANAGEMENT 5.1 Do you know where the offices of the River Horse

Valley Business Estate Management Association are located? (X)

Yes No

5.2 Do you believe establishing a Management Association for RVHBE is a positive intervention? Mark with X

Yes No

5.3 In your opinion what should the primary focus areas of the management association be?

1)

2)

3)

Mark with X

5.4 Rate the various urban management issues (1 = Major problem to 3 = Not a problem) Mark with X

Safety and security 1 2 3

Traffic policing 1 2 3

Refuse removal 1 2 3

Street cleaning 1 2 3

Street lighting 1 2 3

Traffic management 1 2 3

Maintenance of verges / open space

1 2 3

Other (describe):

5.5 Do you experience any transport-related challenges

within RHVBE?

Mark with X

Road capacity Yes No

Road maintenance Yes No

Traffic signalling Yes No

Taxis Yes No

Bus Yes No

Rail Yes No

Other (please specify):

5.6 If “yes”, please specify (be specific in terms of locations where possible).

5.7 Do you have a Corporate Social Responsibility Programme that targets local communities? Mark with X

Yes No

5.8 If “yes” please provide an indication of the focus of this Programme?

5.9 What is the annual spend on CSRP?

R

5.10 Are you willing to participate in Corporate Social Responsibility Programmes impacting on areas surrounding River Horse Valley?

5.11 Are there specific urban management issues that should be addressed in River Horse Valley and who should take responsibility for these?


STRATPLAN

NOVEMBER 2012

60

5.12 Do you have any other comments or suggestions you would like to make? __________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Contact Tindall Kruger on 071 698 1362 should you have any queries regarding this questionnaire

Thank you kindly for participating in this socio-economic study for River Horse Valley Business Estate. The eThekwini Municipality, Tongaat Hulett Developments and the River Horse Valley Business Estate

Management Association wishes your company everything of the best in your business endeavours.

SEE THE RECENTLY LAUNCHED WEB-SITE OF THE ESTATE MANAGEMENT ASSOCIATION AT:

www.riverhorsevalley.co.za

http://www.riverhorsevalley.co.za/


STRATPLAN

NOVEMBER 2012

61

ANNEXURE B: LIST OF COMPANIES IN RHVBE AND INTERVIEW STATUS

NO PROPERTY OCCUPIED BY STATUS STREET ADDRESS PROPERTY INTERVIEW

STATUS

1 360X Holding (Pty) Ltd Tenant U5, 57 River horse Road Erf 01 Ptn 123 Interviewed

2 ABB Tenant 31 Imvubupark Place Erf 34 03 Didn't participate

3 ACT - Advanced Channel Technology

Tenant 10E Kubupark Close Erf 01 Ptn 084 Didn't participate

4 Ampath Trust Owner 33 River Horse Road Erf 01 Ptn 116 Didn't participate

5 Art Printers Owner 70 Corobrik Road Erf 01 Ptn 087 Interviewed

6 Astrapak KZN Owner 1 Imvubupark Close Erf 01 Ptn 028 Interviewed

7 Athena Sports Tenant U11, 32 Kubu Avenue Erf 01 Ptn 039 U 11 Didn't participate

8 Axiz Tenant U4, 12 Kubu Avenue Erf 01 Ptn 040 Didn't participate

9 Barloworld Equipment Tenant 17 Imvubupark Place Erf 32 Ptn 02 Interviewed

10 Barrows Design & Manufacturing

Tenant U1, 12 Kubu Avenue Erf 01 Ptn 040 Didn't participate

11 Bedrock Trading(SUPA FOODS)

Tenant U14A, 21 Quarry Park Pl Erf 01 Ptn 110 Didn't participate

12 Berco Express Owner 28 Island Circle Erf 01 Ptn 033 Didn't participate

13 Bidvest Food Service Tenant 1 Island Grove Erf 01 Ptn 027 Didn't participate

14 Big Five Business Park 10 Kubupark Close Erf 01 Ptn 084 Didn't participate

15 Black Voice Marketing Tenant 27A Island Circle Erf 01 Ptn 003 Didn't participate

16 BP Drakensberg Tenant 45A River Horse Road Erf 01 Ptn 121 Didn't participate

17 Brand Effects Tenant U3, 32 Kubu Avenue Erf 01 Ptn 039 U 03 Didn't participate

18 Broll Properties Agent 14 River Horse Close Erf 01 Ptn 140 Didn't participate

19 Bubesi Investments Owner 2 Island Grove Erf 01 Ptn 046 Interviewed

20 Builders Warehouse Tenant 23 River Horse Road Erf 01 Ptn 118 Interviewed

21 Bytes Communication Systems

Tenant 53 Island Circle Erf 01 Ptn 016 Interviewed

22 Bytes Document Solutions Tenant 53 Island Circle Erf 01 Ptn 016 Interviewed

23 Bytes System Integration Tenant 55 Island Circle Erf 01 Ptn 017 Interviewed

24 CAPCO Owner 2 Corobrik Place Erf 01 Ptn 090 Interviewed

25 Cape Couriers Owner U3, 2 Corobrik Road Erf 01 Ptn 094 Didn't participate

26 Captivity Headwear Tenant S2, 80 Corobrik Road Ptn 85-S02 Didn't participate

27 CBI Electrical Industrial Controls

Tenant S17, 80 Corobrik Road Ptn 85-S17 Didn't participate

28 Chateau Gateaux Tenant 49 Island Circle Erf 01 Ptn 014 Interviewed

29 Chespak Tenant U2, 45/47 Island Circle Erf 01 Ptn 100 U 02 Didn't participate

30 City Couriers Tenant 350 Umhlangane Road Erf 01 Ptn 098 Interviewed

31 Classic Acoustics Tenant S9, 80 Corobrik Road Ptn 85-S09 Interviewed

32 Cleaning World Tenant U14, 32 Kubu Avenue Erf 01 Ptn 039 U 14 Didn't participate


STRATPLAN

NOVEMBER 2012

62


STATUS

33 CMG Eelectric Motors Tenant S13,80 Corobrik Road Ptn 85-S13 Interviewed

34 Courier It Tenant U7, 21 Quarry Park Place Erf 01 Ptn 110 Interviewed

35 CSD Targus Distribution (PTY) Ltd

Tenant U2, 32 Kubu Avenue Erf 01 Ptn 039 U 02 Interviewed

36 Curcuit Breaker Industries Electric Low Voltage

Tenant S18, 80 Corobrik Road Ptn 85-S18 Interviewed

37 Current Automation Owner S6, 80 Corobrik Road Ptn 85-S06 Didn't participate

38 D P E World Wide Express Tenant S1, 80 Corobrik Road Ptn 85- S01 Interviewed

39 Dales Bros Auctioneers (Pty) Ltd

Owner 5 River Horse Place Erf 01 Ptn 0152 Interviewed

40 Dawning Filters Owner U11, 2 Corobrik Road Erf 01 Ptn 094 Interviewed

41 DBC Packaging Owner 11 Corobrik Place Erf 01 Ptn 088 Interviewed

42 Diesel Electric 1 River Horse Place Erf 01 Ptn 075 Interviewed

43 Discovery - Logistics Tenant U4, 45/47 Island Circle Erf 01 Ptn 100 U 04 Interviewed

44 Discovery - Office/Call Centre

Tenant 41 Imvubupark Place Erf 34 08 Interviewed

45 Durban Data Imports (Pty) Ltd

Owner U4, 2 Corobrik Road Erf 01 Ptn 094 Interviewed

46 Dynamic Cut & bend (Pty) Ltd

U7, 2 Corobrik Road Erf 01 Ptn 094 Didn't participate

47 Edmonds Projects Tenant S8, 80 Corobrik Road Ptn 85-S08 Didn't participate

48 EGL (Eagle Global Logistics) Tenant U2, 1 Imvubupark Place Erf 01 Ptn 058 Interviewed

49 Engen Petroleum – PFS West

Owner 123 Queen Nandi Drive Erf 01 Ptn 130 Didn't participate

50 Espresso Owner U4, 10 Hippopark Avenue

Erf 17 of 1 Interviewed

51 eThekwini Hospital Owner 11 River Horse Road Erf 01 Ptn 047 Interviewed

52 Euroshower & Sanitary Ware

Tenant U8, 2 Corobrik Road Erf 01 Ptn 094 Interviewed

53 Exquisite Indents Tenant 350 Umhlangane Road Erf 01 Ptn 098 Didn't participate

54 Fast on Shoes Owner U15, 21 Quarry Park Place

Erf 01 Ptn 110 Didn't participate

55 First Distribution + Audiosure

Tenant U12, 45/47 Island Circle Erf 01 Ptn 100 U 12 Interviewed

56 Formax Tenant U2, 2 Corobrik Road Erf 01 Ptn 094 Interviewed

57 Franke Kitchen Systems (Pty) Ltd

16 Imvubupark Place Erf 32 Ptn 01 Didn't participate

58 Fusion Performance Tenant U1, 57 River Horse Road Erf 01 Ptn 123 Didn't participate

59 GAC Laser International Logistics

Tenant 2 Quarry Park Place Erf 01 Ptn 154 Didn't participate

60 Genmatics Workshop Owner U5, 21 Quarry Park Place


61 Gijima AST Tenant U5, 12 Kubu Avenue Erf 01 Ptn 040 Didn't participate

62 Gottlieb Group Owner 11 Quarry Park Place Erf 01 Ptn 111 Interviewed

63 Greenville Trading 463/Yi Han

Tenant Interviewed

64 Grenville Trading 463/Yi Han

Tenant S10, 80 Corobrik Road Ptn 85-S10 Interviewed

65 Grid Construction U3, 12 Kubu Avenue Erf 01 Ptn 040 Didn't participate


STRATPLAN

NOVEMBER 2012

63


STATUS

66 Grom Trading (Pty) Ltd Owner U2, 21 Quarry Park Place


67 Group 5 KZN Tenant 41 Island Circle Erf 01 Ptn 010 Interviewed

68 Hellman Worldwide Logistics

Tenant 11 Quarry Park Place Interviewed

69 Hi-Tech Polymers Tenant U13, 32 Kubu Avenue Erf 01 Ptn 039 U 13 Didn't participate

70 Index Property Services Managing Agent

80 Corobrik Road Ptn 85 Erf 33 Didn't participate

71 Interstat Agencies Tenant 31-33 Island Circle Erf 01 Ptn 069 Interviewed

72 ISLAND BRIDGE OFFICE PARK

23 Island Circle Erf 01 Ptn 001 Didn't participate

73 Kevro KZN Tenant 39 River Horse Road Erf 01 Ptn 120 Didn't participate

74 Kolok & OCE Tenant 1 Island Grove Erf 01 Ptn 027 Didn't participate

75 Kovco Owner U3, Imvubupark Place Erf 01 Ptn 058 Interviewed

76 KPH Logistics U8, 57 River Horse Road Erf 01 Ptn 123 Didn't participate

77 Luxor Paints Tenants U5, 32 Kubu Avenue Erf 01 Ptn 039 U 05 Interviewed

78 Macadams International Owner 10B Kubupark Close Erf 01 Ptn 084 Interviewed

79 Mandos Auto Panels Owner U2;3;7, 90Corobrik Road Erf 01 Ptn 063 Didn't participate

80 Massmart Tenant 10 Quarry Park Place Erf 01 Ptn 134 Didn't participate

81 MCT Telecommunications Tenant U14, 21 Quarry Park Place

Erf 01 Ptn 110 Interviewed

82 Midas Group Tenant 35 Imvubupark Place Erf 34 07 Interviewed

83 Milnex 142 cc Tenant U9, 57 River Horse Road Erf 01 Ptn 123 Interviewed

84 Minnies Food Enterprise CC Tenant 29 Island Circle Erf 01 Ptn 004 Didn't participate

85 Minolta Tenant 1 Island Grove Erf 01 Ptn 027 Didn't participate

86 Mipaq Properties Tenant U18, 32 Kubu Avenue Erf 01 Ptn 039 U 18 Didn't participate

87 Mr Price Group Tenant 350 Umhlangane Road Erf 01 Ptn 098 Interviewed

88 Multi Media Print Technology

Owner 1 Kubu Avenue Erf 01 Ptn 042 Didn't participate

89 Natal Stainless Steel Owner U3, 21 Quarry Park Place


90 NMI Durban South Motors (Pty) Ltd t/a Mercedes Benz Comm Vehicles Durban

Owner 5 Hippopark Avenue Erf 12 Ptn 1 Interviewed

91 Nomedic Owner U5,90 Corobrik Road Erf 01 Ptn 063 Interviewed

92 Origin Aluminium Tenant U3, Imvubupark Close Erf 01 Ptn 105 Didn't participate

93 Otto Bros Tenant 21 Kubu Avenue Erf 01 Ptn 038 Didn't participate

94 P&L Agencies Tenant U25, 32 Kubu Avenue Erf 01 Ptn 039 U 25 Didn't participate

95 Page Automation Tenant U6, 32 Kubu Avenue Erf 01 Ptn 039 U 06 Interviewed

96 Panbro Plastics Owner 10 Imvubupark Close Erf 01 Ptn 107 Interviewed

97 Parmalat KZN Tenant 9 Imvubupark Place Erf 01 Ptn 056 Interviewed

98 Petroport Durban Interviewed

99 Petropulp Stainless Steel Tenant S12, 80 Corobrik Road Ptn 85-S12 Interviewed


STRATPLAN

NOVEMBER 2012

64


STATUS

100 Pharmed Pharmaceuticals Owner 31 Imvubupark Close Erf 01 Ptn 106 Interviewed

101 Photonote Owner U4, 21 Quarry Park Place


102 Plessey South Africa Tenant 10D Kubupark Close Erf 01 Ptn 084 Didn't participate

103 Prosound (Pty) Ltd Tenant U2, 11 Imvubupark Close


104 Proximity Properties 219 Interviewed

105 Purple Rain Tenant U3&4, 57 River Horse Road


106 R & R Marketing Tenant U2, 23 Island Circle Erf 01 Ptn 001 Didn't participate

107 RAM Hand to Hand Couriers

Owner CEDAR PARK U1, 21 Quarry Park Place


108 Reid Raetzer Owner 21 River Horse Close Erf 01 Ptn 138 Interviewed

109 Rewards Co Tenant U1, 10 Hippopark Avenue

Erf 17 of 1 Didn't participate

110 Rewardsco Contact Centres (Pty) Ltd

Chairman 10 Hippopark Avevnue Erf 17 of 1 Didn't participate

111 Rex Diff & Gearbox Tenant U6, 45/47 Island Circle Erf 01 Ptn 100 U 06 Didn't participate

112 Ricoh South Africa Tenant 2 Kubu Avenue Erf 01 Ptn 041 Interviewed

113 RIVERBEND OFFICE PARK Managing Agent

45/47 Island Circle Erf 01 Ptn 100 Didn't participate

114 River Horse Caterers Tenant U26, 32 Kubu Avenue Erf 01 Ptn 039 U 26 Didn't participate

115 RJ Southey Owner 24A Island Circle Erf 01 Ptn 034 Interviewed

116 Roan Systems Tenant U12,32 Kubu Avenue Erf 01 Ptn 039 U 12 Interviewed

117 Robert Bosch PTY (Ltd) Tenant U24, 32 Kubu Avenue Erf 01 Ptn 039 U 24 Interviewed

118 Roco Fittings Tenant U1, 45/47 Island Circle Erf 01 Ptn 100 U 01 Didn't participate

119 Royal Vulcanizing Station Interviewed

120 RRCO Investments Tenant U3, 23 Island Circle Erf 01 Ptn 001 Didn't participate

121 RTT Durban - Fuel Group Tenant 24 Imvubupark Place Erf 34 01 Didn't participate

122 Russet Properties Owner 10A Kubupark Close Erf 01 Ptn 084 Didn't participate

123 SAAB Grinteck Tenant S3, 80 Corobrik Road Ptn 85-S03 Interviewed

124 Sahib Foods Tenant S4, 80 Corobrik Road Ptn 85-S04 Didn't participate

125 Saint Gobain Gyprol SA Tenant 52 Kubu Avenue Erf 05 Ptn 1 Interviewed

126 Scheinder Systems Tenant 02 Corobrik Road, River Horse Road


127 Schenker Logistics Tenant 40 Corobrik Road Erf 01 Ptn 068 of 50 Didn't participate

128 Service Parts Logistics Tenant U22, 32 Kubu Avenue Erf 01 Ptn 039 U 22 Interviewed

129 Signature Imports Tenants U9, 32 Kubu Avenue Erf 01 Ptn 039 U 09 Didn't participate

130 Silvertron 487 cc 35-39 Island Circle Erf 01 Ptn 099 Didn't participate

131 Siyanqoba Worldwide Express

Tenant U11 45/47 Island Circle Erf 01 Ptn 100 U 11 Interviewed

132 Smart Stone KZN Tenant 23 River Horse Road Erf 01 Ptn 118 Didn't participate

133 Snap-on Africa (Pty) LTD Tenant U6, 12 Kubu Avenue Erf 01 Ptn 040 Interviewed


STRATPLAN

NOVEMBER 2012

65


STATUS

134 Southey Holdings (Pty) Ltd Owner Interviewed

135 Sozo Logistics (Pty) Ltd Tenant 45B River Horse Road Erf 01 Ptn 121 Interviewed

136 Spencer Electrical Tenant U10, 45/47 Island Circle Erf 01 Ptn 100 U 10 Didn't participate

137 Standard Bank Owner 51 River Horse Road Erf 01 Ptn 122 Didn't participate

138 Standard Yoke & Timber Owner 10 Corobrik Place Erf 01 Ptn 089 Didn't participate

139 Steves Auto Clinic Owner U9, 2 Corobrik Road Erf 01 Ptn 094 Interviewed

140 Sutherland Home Furnishing

Owner 25 Island Circle Erf 01 Ptn 002 Didn't participate

141 SWT Solid Wast Tenant U1,90 Corobrik Road Erf 01 Ptn 063 Didn't participate

142 Tandem Lawn Industries Owner 5 Imvubupark Place Erf 01 Ptn 083 Didn't participate

143 Team Clothing & Gifts Tenant 39 River Horse Road Erf 01 Ptn 120 Interviewed

144 TEESAV Tenant U5, 45/47 Island Circle Erf 01 Ptn 100 U 05 Didn't participate

145 Tegs Timbers / J & K Timbers (Pty) Ltd

Owner 10 Corobrik Place Erf 01 Ptn 089 Interviewed

146 Tegwen Agencies Owner U1, 23 Island Circle Erf 01 Ptn 001 Didn't participate

147 The Hardy Boys Tenant U3, 10 Hippopark Avenue

Erf 17 of 1 Interviewed

148 The Natal Witness Tenant 43 Imvubupark Place Erf 34 05 Interviewed

149 The Smart Food Company Tenant S11, 80 Corobrik Road Ptn 85-S11 Interviewed

150 The Supplement Tenant U16, 32 Kubu Avenue Erf 01 Ptn 039 U 16 Didn't participate

151 Time Freight Tenant 2 Quarry Park Place Erf 01 Ptn 154 Interviewed

152 Trentyre Tenant 2 Kubu Avenue Erf 01 Ptn 041 Interviewed

153 Tri Star Technology Owner 43 Island Circle Erf 01 Ptn 011 Interviewed

154 Trumpeter Publishers Tenant U21, 32 Kubu Avenue Erf 01 Ptn 039 U 21 Interviewed

155 Umpheme 16 Imvubupark Place Erf 32 Ptn 01 Sec01 Didn't participate

156 Unichem Services Tenant 27B Island Circle Erf 01 Ptn 003 Didn't participate

157 Unilever Owner 69 River Horse Road Erf 01 Ptn 157 of 125

Interviewed

158 Uniplate/Falcon Tenant U6, 2 Kubu Avenue Erf 01 Ptn 041 Didn't participate

159 United Power Purchasing Tenant S16, 80 Corobrik Road Ptn 85-S16 Interviewed

160 Unitrans Tenant 20 Imvubupark Close Erf 01 Ptn 108 Didn't participate

161 UTI Pharma Tenant 25 Imvubupark Place Erf 34 04 Interviewed

162 Uvex Safety SA Tenant 2 Kubu Avenue Erf 01 Ptn 041 Interviewed

163 Valve Specialists Owner U10, 2 Corobrik Road Erf 01 Ptn 094 Interviewed

164 Vega School Tenant 16 Imvubupark Place Erf 32 Ptn 01Sec02 Interviewed

165 Vodacom Tenant U1, 11 Imvubupark Close Erf 01 Ptn 105 Didn't participate

166 Vulcan Catering Equipment Tenant 1 Island Grove Erf 01 Ptn 027 Interviewed

167 Waltons Warehouse 69 River Horse Road Erf 01 Ptn 158 of 125

Interviewed

168 Widex Tenant 22 Island Circle Erf 01 Ptn 018 Interviewed

169 Xtreme Enterprise Tenant U7, 32 Kubu Avenue Erf 01 Ptn 039 U 07 Interviewed


STRATPLAN

NOVEMBER 2012

66


STATUS

170 Ygi Tenants U19, 32 Kubu Avenue Erf 01 Ptn 039 U 19 Didn't participate

171 Zan Technologies cc Tenant S7, 80 Corobrik Road Ptn 85-S07 Interviewed

172 Zest Electric Motors Owner 51 Island Circle Erf 01 Ptn 015 Interviewed

173 Owner 5 River Horse Close Erf 01 Ptn 135 Didn't participate

174 Aristocrat Owner U7 45/47 Island Circle Erf 01 Ptn 100 U 07 No longer in River horse Valley

175 Mitras Amenities Tenant S5, 80 Corobrik Road Ptn 85-S05 No longer in River horse Valley

176 Prominent Paints Tenant 2 Kubu Avenue Erf 01 Ptn 041 No longer in River horse Valley

177 Topline Distributors Tenant U9, 45/47 Island Circle Erf 01 Ptn 100 U 09 No longer in River horse Valley

178 Igus Plastics Tenant S14, 80 Corobrik Road Ptn 85-S14 No longer in River horse Valley

179 Topline Distributors Tenant U3, 45/47 Island Circle Erf 01 Ptn 100 U 03 No longer in River horse Valley

180 Thundebolt Graphics Tenant U1, 32 kubu Avenue Erf01 Ptn 039 U01 No longer in River horse Valley

181 Nicaf Traders Tenant S15, 80 Corobrik Road Ptn 85-S15 No longer in River horse Valley

182 Intertrans KZN (ACE Worldwide Movers )

U20, 32 Kubu Avenue Erf 01 Ptn 039 U 20 No longer in River horse Valley

183 Cenprop Owner 37 Island Circle Erf 1 of Ptn 7+99 No longer in River horse Valley

184 MAXPROP MANAGEMENT 02 Corobrik Road Erf 01 Ptn 094 No longer in River horse Valley

Managed Precinct Sustainability Projects

SID Urban Management (Pty) Ltd 2008/015008/07 Page - 1 -

ANNEXURE C: ACTIVITIES OF THE RIVER HORSE VALLEY BUSINESS ESTATE MANAGEMENT ASSOCIATION

MANAGED PRECINCT SUSTAINABILITY PROJECTS

VALUE THEY CAN BRING TO COMMUNITIES DELIVERED THROUGH PUBLIC PRIVATE

PARTNERSHIP

27 October 2011

(Updated 13 June 2012)

SID Urban Management (Pty) Ltd



Contents

1. Introduction .................................................................................................................................... 3

2. Wetland Rehabilitation ................................................................................................................... 3

3. Tree Planting Programme ............................................................................................................... 4

4. Urban Trail Network........................................................................................................................ 4

5. International Coastal Cleanup Day ................................................................................................. 5

6. Schools Open Classroom ................................................................................................................. 6

7. Water Quality Testing ..................................................................................................................... 6

8. Informal Vendors ............................................................................................................................ 6

9. Metrorail ......................................................................................................................................... 6

10. Sportsfield Rehabilitation ........................................................................................................... 7

11. Public Transport .......................................................................................................................... 7

12. Walk to Work Initiative ............................................................................................................... 8

13. BEE Certification .......................................................................................................................... 8

14. Other ........................................................................................................................................... 8

a. Mobile Optometry .......................................................................................................................... 8

b. Mobile Banking ............................................................................................................................... 9

c. Clinic ................................................................................................................................................ 9

d. Lower mNgeni Catchment Management Forum ............................................................................ 9

e. eThekwini Environmental Team ..................................................................................................... 9

15. Conclusion ................................................................................................................................... 9



1. Introduction

Throughout the world, the abilities of Local Government to continue to deliver high levels of

service across all areas is being challenged by many varied social and economic factors.

Nowhere is this more evident than in South Africa and eThekwini especially where limited

resources are being channelled into rolling out service delivery into previously under and

unserviced areas. Managed Precincts (i.e. Management Associations, Urban Improvement

Precincts, Special Ratings Areas, Priority Zones, etc) are a mechanism increasingly being used to

manage areas positively and provide additional top-up services, paid for by way of levies, by

those who benefit from them through enjoying a potentially higher quality and value urban

environment. The benefits of this, while not being the purpose of this report, are many and

varied including improved investment and retention/growth of property values, which in turn

increase tax income for both national and local authorities.

Managed Precincts have on occasion however, been considered by local government to be elitist

and exclusionary, serving the interests only of the well to do middle classes. The purpose of this

report is to highlight how the opposite can in fact be the case. An inclusionary approach to

managed precincts as taken by SID Urban Management (Pty) Ltd, is one which recognises

communities, both within and neighbouring respective precincts, and embraces their varied

relationships and involvement in each precinct. This is further leveraged by engaging in positive

Public Private Partnerships (PPP’s) with Local Government and private companies, where

Management Associations can act as both facilitator and active participant. Examples of

Sustainability Projects both delivered and planned will be briefly described, highlighting current

and future challenges, as well as noting respective liaisons and local authority departments.

The majority of these projects have been planned and tested within Riverhorse Valley Business

Estate by the RHVBE Management Association in association with SID Urban Management. The

belief is that as each is piloted, refined and delivered here, they can be considered for replication

elsewhere where appropriate.

2. Wetland Rehabilitation

As a Riverhorse Valley Business Estate (RHVBE) – eThekwini Public-Private Partnership Project,

bulk earthworks for the rehabilitation of 41 hectares of wetland along the Umhlangane River

(previously under sugar cultivation but lying fallow since the development of the area) within

Riverhorse Valley Business Estate is to commence shortly, funded to a large degree by

eThekwini’s Coastal, Stormwater & Catchment Management Dept ( foreign funding from the City

of Bremen in Germany as part of eThekwini’s developing relationship with partner cities has not

been successful). Currently the project is awaiting DAEA approval before work can commence

on site.

Completion of the project and ongoing maintenance (including clearing of alien invasive species)

will be funded by RHVBE Management Association funds. Efforts are also underway to secure

maintenance funding from corporate donors resident within RHVBE, international donors

accessed via both COP17 visitors and the Durban Chamber of Commerce and Industry’s



Environmental Committee, as well as National Government’s Extended Public Works

Programme.

RHVBEMA recently participated in two full day workshops arranged by the City, evaluating the

entire Umhlangane River catchment area and developing scenarios for both environmental and

social benefit.

eThekwini’s Gary Cullen (031 311 4235 – Economic Development Unit) and Geoff Tooley (031

311 7271 – Water Engineering) have been pivotal in this project.

3. Tree Planting Programme

In additional to the RHVBEMA’s extensive ongoing public area landscape maintenance

operations (including alien invasive species removal), a sum of R750 000 project funding has

been allocated to be spent by the RHVBEMA over a period of 3 years, to plant new indigenous

trees within the riverine environment alongside the Umhlangane River. This is being

supplemented by “offset taxes” imposed by RHVBEMA on top structure developers who were

unable to fully comply with their internal landscaping requirements per the RHVBE Design Code.

The first phase of this planting carried out in Spring 2012 is complete, taking advantage of good

soil and moisture conditions. Phase 2 and if necessary Phase 3 will roll out in Spring 2012 and

2013 respectively.

All plants have been sourced from small growers within the region, ensuring direct economic

benefit to these growing communities. Access to trees sourced in a similar way in the future

with the possibility of a Tongaat Hulett initiated nursery on the Umhlodti stable site, will assist

here as well as assist in ensuring viability of such a nursery.

Tongaat Hulett Developments, Musa Shabane (031 560 1900) is promoting the Nursery project.

The RHVBEMA hopes to access additional project labour for the planting seasons during 2012 &

2013 by way of the National Government’s Expanded Public Works Programme (EPWP). Support

by eThekwini of this application will be of great value.

4. Urban Trail Network

RHVBEMA is an active participant in the City’s Green Corridor Programme, with the view that

riverside trails as recently mapped by a specialist tour guide on behalf of eThekwini, will form

part of a larger trail network linking the mouth of the Umgeni (Green Hub building) to RHVBE

and Bridge City beyond, as a tributary of its main focus linking Inanda Dam to the Umgeni river

mouth. These will be used by trail runners, walkers, mountain bikers and bird watchers along its

length with both active and passive recreation supported. Importantly it is also anticipated that

it will provide a traffic free route for communities along its length using non-motorised transport

(bicycles), to access employment opportunities within the Durban CBD or other suburbs/zones

along the Corridor, e.g. Bridge City & Phoenix Industrial Park.

The long term vision of RHVBE is to develop additional complementary trails which can be seen

as an extension and integrated part of Durban’s Green Corridor Programme, to be used for both

active and passive recreational pursuits. It is also envisaged that parts of these trails will enable



access into densely vegetated areas in order to facilitate identification and removal of alien

invasive plant species.

It is our vision therefore to introduce an additional set of trails within the boundaries of RHVBE,

creating an urban trail network which will attract users from within the daytime business

community (before work, lunch time and after work), as well as those users residing in the

various neighbouring residential communities, some of whom already make use of the informal

trails.

A specialist trail design and building company has been commissioned to investigate and design

a masterplan for potential trails and routes within RHVBE complementary with the Green

Corridor, with an emphasis on Huletts Bush. The design is now finalised and funding is to be

sourced for construction of these trails. They will be constructed using local labour as has been

done with the 110km of trail introduced by eThekwini around Inanda Dam. Trail maintenance

and security are to be provided with assistance of local labour from Quarry Heights and Simms

Place informal settlements in the form of “Trail Rangers”. This is consistent with our vision at

RHVBEMA to encourage and facilitate regular use of this riverine environment by members of

adjacent communities as well as create employment opportunities which are meaningful and

sustainable.

The clearing of areas of bush and trees to facilitate the creation of trails within Hullets Bush, will

be done with a view to removing alien invasive plant species and as such, provide an

environmental benefit to the area. This vision will continue post completion where Trail

Rangers will be involved with trail maintenance and invasive clearing on an ongoing basis.

Regarding access and indemnity, an option is to align the proposed trails with those on Tongaat

Hulett sugarcane farmland north of Umhlanga & Mt Edgecombe, where access is strictly

governed by the Ethekwini Mountain Bike Association (EMBA) on condition that each rider sign

an annual indemnity and is identified by a uniquely numbered board. This would be preferable

to setting up an independent process specifically for RHVBEMA. Suitably worded signage at all

access points would need to point out that use of the trails implies acceptance of risk by users in

order to protect the City, RHVBEMA and any other parties (e.g. sponsors/funders). Despite

these disclaimers, the entire project is based on having sufficient measures in place to provide a

reasonable level of safety for users, without which the project will not succeed.

5. International Coastal Cleanup Day

RHVBEMA for the 3rd year hosted its annual river cleanup along stretches of the Umhlangane

(Friday 16 September 2011), the afternoon prior to the International Coastal Cleanup Day. This

was supported by RHVBE businesses and Schools which enthusiastically participate each year.

(This has been extended to include recycling education and provision of collection bins at

Quarry Heights Primary school itself).

The purpose is many fold, including educating school children about the impact of littering and

its environmental cost, as well as encouraging RHVBE businesses to engage first hand with the

river that many have views of but don’t yet access as a recreational opportunity. By hosting on

the Friday prior to the Saturday coastal cleanup (in addition to making it attractive and



accessible to businesses and schools), it highlights the importance of treating the problems of

littering at their source rather than merely attending to the effect of this and the need to clean

up the coastline of litter, much of which is carried to the coast via rivers. As many schools

become involved in the river clean up this year, we staggered the sessions and separated school

(morning) and corporate (afternoon) participation to allow a meaningful opportunity for all

participants. Umgeni Water and Durban Solid Waste representatives gave short lectures to

learners to add to the learning experience.

6. Schools Open Classroom

Our involvement with other schools in adjacent communities is growing with a vision that the

natural riverine areas within RHVBE be accessible to school groups as an open classroom for

experiential learning appropriate to their various curricula. This concept was presented to the

Principals Forum made up of approximately 20 local school leaders who meet regularly, and was

positively viewed. Our long term view is to provide a small classroom type structure which can

be used to reinforce the Open Classroom activity.

7. Water Quality Testing

In addition to liaising with eThekwini’s water quality testing operations, RHVBEMA have

commenced its own supplementary water quality testing, the results of which are shared with

eThekwini on a monthly basis. Readings taken at 3 points along the Umhlangane River within

RHVBE allows us to monitor water quality overall and could highlight potential upstream

infringements by businesses or facilities discharging illegally, and provide appropriate support

for effective enforcement. Water quality testing may well form part of school curricula and

could be one aspect of experiential learning carried out in our open classrooms.

Liaison – Mlungisi Mahlobo, Pollution and Environment Branch, eThekwini Water and Sanitation,

031 311 8735

8. Informal Vendors

Informal vendors are accommodated at designated locations within the Estate and provide a

valuable retail service to much of the pedestrian traffic as workers make their way both to and

from their places of work. Awarding of permits is controlled by the City’s Small Business Support

Unit who also assist with enforcement if required.

RHVBEMA is attempting to source shelter of a uniform type for the sites, creating a more

structured perception and branding for the Estate. Efforts are underway to recycle unused

vendor/bus shelters from elsewhere in the city.

Liaison – Justice Dlamini, eThekwini Small Business Development Unit, 031 311 4612.

9. Metrorail

The Effingham Station falls within the boundaries of RHVBE and has become one of their most

profitable in eThekwini with in excess of 6000 journeys/passengers passing through per day.



Collaboration with Metrorail, the managers of the Effingham Station has been initiated on

various occasions with a view to amongst other projects, synchronising their security service on

the station platform with backup from the RHVBEMA CCTV control room and rapid response

vehicle, recycle the station’s collected litter as part of RHVBEMA’s wider litter picking and

recycling programme, as well as co-ordinating their landscaping service with that of the

RHVBEMA to facilitate alien invasive species removal and maintenance. The RHVBEMA was

advised that the pedestrian bridge which only provides access to the platform from one side

(Corobrick Road) and is in need of structural maintenance was to be upgraded or replaced.

Unfortunately all promises to liaise with RHVBEMA in this regard have not been fulfilled, as has

been the case with the various other initiatives being driven by RHVBEMA.

10. Sportsfield Rehabilitation

An aspect missing from the original design for RHVBE was the provision of suitable active

recreational areas for staff of the many businesses resident here. There is an active football

league with highly competitive matches being played between teams representing various

companies within RHVBE. To assist with providing a suitable nearby facility on which these

matches can be played, the RHVBEMA initiated talks with eThekwini’s Parks, Leisure &

Cemeteries Dept with a view to assisting to enhance and maintain the public sports field on the

northern side of RHVBE. Agreement was reached for the RHVBEMA to fund various project

components (construct pedestrian access to the field from parking area, levelling and improving

of pitch surface and litter/rubble cleaning, plumbing irrigation infrastructure, combined with

visiting the area by the security patrol vehicle as part of its routine patrols, provision of signage

and goalposts). In return, eThekwini would upgrade the field previously a “kick-about” which

only got mowed monthly and was not marked, to “soccer field” on their asset list with weekly

mowing and marking to enable proper football matches to be held not just by the staff teams

but also neighbouring schools and sports clubs, with booking being carried out by the Parks,

Leisure and Cemeteries Dept as is the norm.

Sadly participation by Parks, Leisure and Cemeteries has been poor and communication difficult

although we are still hopeful in completing this project for the benefit of various communities.

Victor Chetty, eThekwini Parks, Leisure & Cemeteries, 031 311 6976.

11. Public Transport

Public transport service into this relatively recently developed precinct was always envisaged to

be provided by minibus taxis. Currently 3 Taxi Associations converge on RHVBE, bringing

associated political tension between them. We have through eThekwini Transport Authority

(ETA) attempted to facilitate a co-ordinated taxi service to assist public transport users who

work within RHVBE and have need of their services. This process commenced in 2009 and

despite several efforts to highjack it for purposes of fulfilling personal agenda and route control,

we believe we are very close to having a functioning service evenly supported by the 3

converging taxi associations, improving service to the daytime community of RHVBE who need

to get to and from their places of work.



We are also attempting to have the 3 representative associations provide a daytime internal

service to allow train commuters to easily and cost effectively access their places of work,

although fresh energy will be put into this initiative once the main routes are finally approved by

authorities.

Beyond this, suggestions regarding suitable positions of taxi lay byes by RHVBEMA have been

made to ETA in order enable budgeting and provision for this essential component without

adding to current peak time road congestion.

12. Walk to Work Initiative

This initiative is borne from efforts to connect unemployed members of communities

neighbouring on RHVBE, with work opportunities potentially offered by businesses here.

Following various interactions with local Ward Councillors and community representatives, we

have collected a database of candidates who comply with the requirement that they live close

enough that they could “Walk to Work”. This is not only practical and convenient for employers

and employees alike, but it is also consistent with current town planning strategy to locate

people near to where they might work. Success has been achieved with the placement of a

small number of candidates with service providers who contract with RHVBEMA. We envisage

further placements of candidates with RHVBE businesses in the future.

Our next step is to synchronise these CV’s with eThekwini’s online jobs portal, retaining their

geographic criteria, but increasing their visibility to a wider audience.

13. BEE Certification

SID Urban Management together with Tongaat Hullet Developements, with support from

Garlicke & Bousefield Attorneys, are currently exploring the Black Economic Empowerment (BEE)

certification of Management Associations, of which RHVBEMA will be a pilot. Once certified, all

donor project funding by private entities channelled via Management Associations, will be

eligible for earning of BEE points to be used in mandatory annual submissions by companies

above the specified threshold. It is anticipated that this will filter down to allow the earning of

BEE points to all property owners through the process of paying their monthly levies. This could

assist greatly in the structuring of Public Private Partnerships for projects within RHVBE.

14. Other

a. Mobile Optometry The Specsavers mobile optometry van has been used to provide an occasional service

for the benefit of employees here providing a convenient service.



b. Mobile Banking We sadly have not been successful in engaging any of the major banks to regularly

position their van based mobile ATM’s within RHVBE for the benefit of workers here.

This has been enormously frustrating as it would be great time saver for staff and their

employers as there is no ATM service in the area with the exception of the hospital

which is not practical for users on the Eastern side of the Precinct. This is despite it

being a weekday suggestion when the ATM vehicles are in low use.

The two filling stations planned to be developed within RHVBE will include ATM facilities

which should solve this problem in time.

c. Clinic Mobile clinics were carried out in the past, similar to the optometric visits. These no

longer are required as the service has been taken up by the clinic in an adjacent

neighbourhood.

d. Lower mNgeni Catchment Management Forum Members of the RHVBEMA management team actively attend and participate in the

Lower mNgeni Catchment Management Forum, a cross departmental initiative run by

eThekwini. This has been a valuable platform to highlight various initiatives driven by

RHVBEMA and to engage with representatives from associated local and provincial

organisations which represent the interests of this river and its catchment areas.

e. eThekwini Environmental Team Similarly, the RHVBEMA is represented at meetings of the cross departmental eThekwini

Environmental Team which focuses on environmental issues and education of learners

amongst other goals.

15. Conclusion Managed Precincts such as Riverhorse Valley Business Estate are centres of excellence, achieved

not just through the provision of topup services to augment those provided by the City, and

importantly not achieved by excluding or marginalising outsiders. Excellence is achieved rather

through an inclusive approach which recognises the interests of the property owning

community, the daytime working community, and those of neighbouring suburbs who in some

cases become Riverhorse Valley’s weekend community. This vision is consistent with that of

Local Authorities across the country and in fact the world, lending Managed Precincts in their

various forms to be used as a vehicles for improving the quality of life for all these communities

through both the delivery of high quality urban environments and associated sustainable

projects, often by way of shared responsibilities in the form of Public Private Partnerships.

Trevor Pierce-Jones

SID Urban Management

RIVER HORSE VALLEY BUSINESS ESTATE SOCIO ... IMPACT ASSESSMENT NOVEMBER 2012 Photos supplied by...

Documents

Transcript of RIVER HORSE VALLEY BUSINESS ESTATE SOCIO ... IMPACT ASSESSMENT NOVEMBER 2012 Photos supplied by...