Many owners are under the impression that the fact that their land falls in an area where Council will support a certain high-density rezoning, that their land is a “pot of gold.” The question seasoned developers will ask is – If the land is a pot of gold, why does the owner not do the rezoning/development? The answer to that question may very well be that the owner did not have the finance at hand alternatively the owner does not have an appetite for risk.

The actual cost of employing a Town Planner to do the re-zoning application varies but normally does not exceed R 200 000. Keep in mind the time-value of money, as the rezoning can take anything between 12-18 months. However, when the owner’s land is re-zoned, the period for a developer to go into ground, as well as his risk to go through a re-zoning application is minimized, and that will increase the value he will be willing to pay for the land.

To unlock more value, a landowner can do a Joint venture (JV) with a developer. In this instance, the landowner must be certain about the JV partner they select. In most instances, the value of the land is debited as first claim against a loan account in the development company. The developer then pays for the re-zoning and obtains the finances to pay for the construction. As reward for the delayed payment of the land purchase price, the landowner shares in the profit of the development.

For most landowners this is something they have never done, but all developers at some time started with their first project. Harcourts Capital has a professional team that includes town planners, architects, land surveyors, transferring attorney and builders that can assist landowners in the development process, whereas, Capital has the expertise in marketing of developments, be it off plan, plot –and- plan of completed sectional – and/or full title developments.