Research firm brings expertise to Tower of Light project
Urban-Econ formulates business plan for huge St George’s Park precinct plan and unpacks its economic benefit
A national economic research consultancy with a strong presence in Nelson Mandela Bay has been lending its expertise to the huge Tower of Light project planned for the city.
Urban-Econ Development Economists not only assisted in the drawing up of a business plan for the Tower of Light, a 27m tower to be built in honour of the late Nelson Mandela, but its researchers were brought in to consider the potential benefits such a development could have for the Bay’s economy and tourism offering.
We asked the local team to share insights about their work in the city.
Please give some background about Urban-Econ.
Urban-Econ Development Economists is a national economic research consultancy that assists clients in the public and private sectors to make informed, calculated decisions regarding investments, governance interventions and policies.
That we have regional offices throughout SA allows our professional researchers to fully appreciate local economic and socioeconomic dynamics unique to each study area when investigating the viability, sustainability and future effects of proposed projects and policies.
How does the consultancy address the unique needs and requirements of each client?
In each of our six regional offices, our economists and researchers possess extensive local knowledge of regional challenges, dynamics and development directions, allowing them to take a hands-on approach.
How did Urban-Econ begin?
Urban-Econ formed in 1985, when our founder and CEO, Dr Judex Oberholzer, recognised the need to combine economic and spatial research techniques using quantitative and qualitative data to make informed decisions.
Our Eastern Cape office was opened in 2004, and is based in Nelson Mandela Bay.
Our small team of eight development economists in our Eastern Cape office has, over the last 14 years, executed more than 500 research assignments in a range of fields across the Eastern Cape.
This has given them deep insight into the development dynamics of the Eastern Cape and Nelson Mandela Bay in particular — and what needs to be done to create jobs, fight poverty and reduce inequality.
What is Urban-Econ’s role in the Tower of Light process?
Urban-Econ joined the Tower of Light consortium to bring its local, Nelson Mandela Bay-specific development experience to the team.
Its role focused on assisting in the formulating of a business plan for the Tower of Light, testing the appetite for such a development and, importantly, considering what potential benefits, if any, the development could have on the economy of the metro.
Equally, it sought to determine how the Tower of Light could link to other tourism products or activities in all parts of the metro — not just the St George’s Park precinct.
What lessons have you learnt about state-driven developmental projects in the Eastern Cape?
Depending on our clients’ needs, many of our research assignments involve the forecasting of a proposed project’s future viability from an economic and/or a financial perspective.
This might be a proposed housing development, regional shopping mall, or case in point, the proposed Tower of Light precinct.
On the other hand, we have been tasked in the past to reflect on the already achieved successes, failures and effects of projects such as government-funded agricultural initiatives or mass employment programmes.
This had given us a good perspective on the critical success factors that contribute towards sustainable, meaningful and viable capital projects.
What are some of these factors?
Some of these key success factors include:
- The need for local communities and residents to buy into a project idea early on in the planning process;
- For the local community to feel a sense of ownership of the project; and
- For the objectives of the project to be well defined and regularly measured post-implementation.
Public consultation and inputs are critical early on in a project’s life cycle, as are clearly defined roles and responsibilities between implementation partners.
It must be appreciated that government or municipalities are not always well-placed to operate sustainable businesses.
The most successful projects that are government supported have both developmental goals, that is, job creation, but are also feasible from a market and financial perspective.
The private sector, if provided with an effective platform, is a key investment partner which often defines the long-term sustained success of a project.
Government need to see themselves as a development enabler and not a business owner.
How can the city justify spending R2bn on a fancy tower?
The estimated R2bn price tag represents the entire cost of the full development of the St George’s Park precinct, of which the Tower of Light is but one component.
Much of this cost will not be incurred immediately as the full development of the Tower of Light Precinct will take several years.
The overwhelming majority of the estimated cost will be covered by private developers and other development institutions, significantly reducing the city’s financial exposure to the development.
What will the bulk of the city's financial commitment to the Tower of Light be?
Most of the city’s financial commitment to the project will be on the tower itself and the associated infrastructure.
The tower is seen as a catalyst to entice private property developers to invest in large-scale commercial property — office blocks, restaurants, event spaces and so on — that will create jobs and benefit local residents.
Furthermore, the proposed precinct development will occur in stages, linked to both the appetite of investors, but also demand for the precinct’s offerings.
What about the Bay’s other pressing challenges, such as housing, the desperate water situation and fixing leaks?
The city is working hard to address the challenges it faces, but the Tower of Light is intended to serve as a symbol of hope and pride while creating a unique attraction and experience for locals and visitors.
What difference can a tourism-based project make?
Tourism is one of the most important industries in the city and has been hit exceptionally hard by the Covid-19 pandemic.
The Tower of Light aims to change this by creating a unique tourist product that will attract local and international visitors, bringing in much-needed income into the city and helping to boost the economy while creating jobs.
Where else will funding come from?
Much of the funding for the Tower of Light precinct development will also be sourced from private investors, with the city likely to seek assistance from national and international donors to help them meet their financial commitments to the project.
The idea is not to use any funding already earmarked for existing housing, water and other infrastructure projects for the Tower of Light.
The funding will need to be sought elsewhere.
St George’s Park is not safe — will tourists want to go there?
The Tower of Light precinct entails a full-scale redevelopment of the park with the key focus being not only improving the look and feel of the space, but also making it more accessible to all visitors.
One of the ways this is to be achieved is changing the perceptions of the park from both a safety and non-safety perspective.
How will safety and accessibility be improved?
As part of the redevelopment, several suggestions have been made to improve the safety and accessibility of the space.
These include 24-hour security patrols by precinct operator staff, improved lighting, broadening walkways and introducing cameras throughout the park.
How is this tower going to benefit residents?
Beyond creating a symbol of hope and pride for citizens, the Tower of Light precinct will help stimulate job creation, both during construction and when it starts operating.
It will also create a dynamic open space centred on the tower, offering visitors a range of experiences linked to sports, the natural environment and retail in the heart of the city — creating a space where all the people of the city can live, work and play.
The Tower of Light is intended to be a primary tourist attraction for a city that celebrates the life of Madiba.
The business plan has also proposed that a new tourist route be developed for the Bay , which will start and end at the Tower of Light.
This will ensure benefits of the projects are maximised throughout the metro.
Would you like to comment on this article or view other readers' comments? Register (it’s quick and free) or sign in now.
Please read our Comment Policy before commenting.